Education has become a necessity for every citizen in the modern era. However, the affordability of quality education is not the same for everyone. The rising cost of quality education is a growing concern. Many students want to refrain from burdening their parents with the high cost of their education. At such a time, the student may opt for an education loan. To begin applying for an education loan in India, one must first ensure that one satisfies the requirements.
Every parent has the same goal regarding their child’s education: to put them in the most prestigious school possible. However, many individuals discover that earning it, particularly from a reputable institution, is financially exhausting. This is especially the case when it comes to the cost of tuition.
One way to cover the costs of attending school, particularly for those who want to further their education, is to apply for a student loan. We offer many different kinds of loans, such as mortgages and car and other vehicle loans.
Eligibility criteria for student loans
To get a student loan, a person must be a citizen or a permanent resident of India.
Education loans may be applied for by the prospective student or the student’s parents if the prospective student is 18 or older. No one beyond the age of 35 may qualify for a federal student loan.
Educational Course Admission
The applicant must have proof from the University Grants Commission (UGC), the Indian Ministry of Higher Education (MHRD), the All India Council for Technical Education (AICTE), or a similar organisation that they have been accepted to a university in India.
To continue, a candidate must have scored at least 60% on all prerequisite assessments.
A Step-by-Step Guide for Education Loan
Getting one is fairly straightforward, and although the application process varies from bank to bank, they all follow the same general steps:
Step One: You’ll need to fill out a loan application.
The applicant must fill out an application form, which may include questions like:
- Pictures of you and me, both passport-sized
- Documentation of completion of secondary school, high school, or its equivalents, such as a diploma or transcript
- Examples of KYC documents are voter ID cards and PAN cards that provide proof of identity, address, and age
- Proof of signatures
- Eligibility for extra money is based on proof of parental income, records for properties, and FDs
A person who wants to get an international student loan must provide the following proof that they want to go to school abroad:
- Two pictures of you, both passport-sized
- Proof of identity and papers showing the right to work (voter ID cards, PAN cards, and proof of identity, residency, and age)
- certificates attesting to a recent exam’s success or grade reports
- Verification of course and university enrolment
- Set aside money for tuition
- More copies of the prize letter (if you have one)
- Bank statements for the last six months from the borrower, parents, or guardian
- All guarantors, parents, and borrowers must provide transcripts of their current and past years’ federal tax returns.
- What exactly is being offered as collateral, if anything? To prove its marketability, mortgage-approval prospects, etc., the applicant may be asked to present a search and report from an advocate
- Proof of relocation provided by candidates
Step Two: A Personal Conversation
After applying, the candidate is interviewed by a bank staff member, who may ask questions about the candidate’s past academic performance, the specific major or field of study, the school attended, and other factors.
Step Three: The applicant needs to provide relevant paperwork.
Before a bank considers a loan application, the applicant must provide all admissions paperwork. The bank needs proof of enrollment at the school before approving the loan.
If the education loan amount exceeds Rs. 4, the applicant may be required to furnish collateral security, such as documentation related to mortgaging the property.
Step Four: Acceptance or Rejection of the Loan
A cosigner is needed for a student loan. The applicant’s parent(s) or guardian(s) might serve as the guarantor. Before approving the loan, the bank will look into the guarantor’s credit history. When the process is complete, the bank may decide whether to provide the loan to the applicant.
Step Five: the actual distribution of the loan.
After all the documentation is submitted, the bank will disburse the loan. The financial institution will cover the cost of college or university by making a direct payment to the school.
Submission of an Online Student Loan Application
Incorporating an online application has made applying for a student loan much less hassle. Applying for an education loan may now be done entirely online. The bank will only approve the education loan if the applicant and the main contact are physically present at the time of approval and distribution.
What does an education loan cover?
- Starter fees for the class
- Affordable housing
- Other college-related necessities
In which cases may one apply for a student loan?
When a student applies for a loan, the student is the principal borrower, and a parent or sibling may be a co-applicant. The student is expected to repay the loan once he earns an income. If the co-applicant does not find gainful employment, he will be liable for repaying the education loan.
What if the person cannot afford to pay back the loan?
The bank may sue them if they cannot repay their student loan. However, the lender also faces scrutiny in these cases since it becomes clear that they did not accurately assess the borrower.
The right to education has emerged as one of the most essential of modern times. However, not everyone has the opportunity to afford a quality education; such people can opt for an education loan. You can take help from Piramal Financing House to decide which loan will be best for you.