Education Loan: How to get education loan? Application Process and documents required

Education Loan: Nowadays it is common to get student loan from bank or financial institution to cover the cost of higher studies. Education loans are becoming crucial in fulfilling students’ desire for higher education.

Experts suggest some things to consider before taking an education loan. Since this is a big financial decision, how much loan amount should be taken? What is the repayment period? Check how much interest is charged.

Eligibility criteria:

Every bank or financial institution has different eligibility criteria for education loans. Some banks offer loans for study abroad, while others offer loans for domestic and international studies. Before applying for an educational loan, candidates should fulfil the respective bank’s eligibility criteria and age, educational background, study, check if the course is there in that list.

Loan Amount:

Each bank has different maximum loan limits. Therefore, before approaching the bank, one should estimate the amount of loan required for education. Calculate the required amount including tuition fees, living expenses, study materials and other expenses and take only the appropriate amount.

Documents:

It is important to know about the documents to be submitted for loan application. Generally, while applying for an education loan, important documents like address proof, income documents, identity proof, academic records, acceptance letter from the institution are required. Keeping all the required documents ready can complete the loan application process faster.

Interest rate and hidden charges:

Compare interest rates offered by different banks and financial institutions. Interest rates can fluctuate so it is better to choose a low interest rate loan to reduce the financial burden. Documents should be signed only after knowing the additional or hidden costs.

Read the terms and conditions of the loan agreement carefully to understand these charges. These may include processing fees, prepayment fees, late payment fees and other penalties. Being aware of these charges will save you from unexpected financial burdens in the future.

Repayment options:

Understand the various repayment options available. Some banks offer a moratorium period during which no payments are required. They also provide a grace period after completing education before loan repayment begins. It is important to know the repayment period, instalment amount so that finance can be planned accordingly.

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