With the ever-rising inflation, cost of living has drastically gone up. And so has the cost of higher education. You may have saved money all your life for the higher education of your children, but it just may not be enough, given the exorbitant fees being charged by reputed educational institutions. Under such circumstances you have no alternative but to take an education loan to give your children the dream education that they want. Taking an education loan is the easiest way for students to finance their higher education, whether they want to study in India or abroad. Banks and other financial institutions offer very attractive education loans to students, and with a moratorium period. This means that the student can start repaying the loan a year after the completion of their studies, or 6 months after getting a job. This makes it very easy for students to obtain instant digital loans. Different banks offer slightly different education loans, in terms of the things it covers, such as tuition fee, hostel fee, equipment fee, etc. This helps the student select the best loan as per their requirements.
The eligibility criteria for a student who wishes to take an education loan are very basic. The student must be a resident of India. They need to have a confirmed admission letter from the university or institute where they wish to pursue their higher studies, whether it is in India or abroad. Generally, banks or financial institutions require that to be eligible for getting an education loan, the student must be between 18 to 35 years of age at the time of applying for the loan. Students who wish to take an education loan to pursue a full-time course must have a co-applicant, such as a parent, guardian or a spouse. Besides, the student must have a good academic track record, and, in case of foreign studies, must have passed the required tests such as TOFEL or IELTS. With instant digital loans now available, the process has become very easy. Most banks require slightly different sets of documents for applying for the education loan, but the common ones are as follows:
Documents to Be Submitted by the Student Applying for the Education Loan
- An application form for the instant digital loan should be submitted which should be fully filled and signed. The education loan interest rates can range from 8.5% to 11%.
- The student and their co-applicant must submit two passport-sized photos of theirs
- A letter of admission from the college or institution for which the education loan is being taken should be submitted.
- The education loan break-up including term or semester fees tuition fees, hostel fees and other living expenses to be incurred during the course of the study program.
- The student’s academic record needs to be documented, which would include their mark-sheet of the 12th board exams, certificates of further study, if any, such as graduation or post-graduation.
- The mark-sheet of the eligibility tests, if any, taken by the student for study in the particular country or institution where they wish to pursue their higher education.
- If the student has received any scholarship, the relevant documents supporting it should also be submitted. Education loan interest rates are lower compared to other types of loans.
- For age proof, the student may submit either a birth certificate or a 10th class leaving certificate for obtaining instant digital loans.
- An affidavit or a declaration to the effect that no other loan has been taken from any other bank or financial institution should be submitted
- The student needs to submit their ID proof, which may be a copy of their passport, PAN card, driving license, Aadhar card, voter ID, etc.
- One of the above documents also needs to be submitted as proof of address
- Lastly the visa and travel papers of the country where the student is going for higher education also have to be submitted.
Documents Needed to Be Submitted by The Salaried Co-Applicant:
- Address proof of the education loan co-applicant, which would be any one of the documents as mentioned above for the student’s address proof
- Identity proof of the co-applicant, also as mentioned above for the student
- Salary slips of the last three months of the co-applicant
- The income tax returns of the last two years of the co-applicant. should be submitted for getting this instant digital loan.
- If the co-applicant has any other source of income not covered by the above documents, that also needs to be specified with relevant proofs
Documents Needed to Be Submitted by The Self-Employed Co-Applicant:
- Address proof of the co-applicant, which would be any one of the documents as mentioned above for the student’s address proof
- Identity proof of the education loan co-applicant, also as mentioned above for the student
- Bank statement of the last six months of the co-applicant
- The income tax returns of the last two years of the co-applicant
- The self-employed co-applicant also needs to submit the proof of work premises, such as a lease-deed, title-deed, or an electricity bill
- If the co-applicant has any other income which is not reflected in the above documents, proof of that also should be submitted.
Taking an education loan also has certain benefits, chief among them being that the applicant paying the EMIs on the loan is eligible for income tax rebate on the interest portion of the loan. Another benefit is that education loan interest rates are lower than they are for other kinds of loans.
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