Nifty99000 100%

Sensex99000 100%

Article rating: No rating
Article rating: No rating
Article rating: 4.3
Article rating: No rating
Article rating: 2.0
Article rating: 1.5
Article rating: No rating
Article rating: No rating
Article rating: No rating
Article rating: No rating
Article rating: No rating
Article rating: No rating
Article rating: No rating
Article rating: No rating
Article rating: No rating
Article rating: No rating
RSS

News

How To Get A Good Deal On Education Loan

Author: Adhil Shetty/Wednesday, May 30, 2018/Categories: Loans, Expert View

How To Get A Good Deal On Education Loan

It’s that time of the year when students are prepping up for higher studies and parents are busy putting together a fund to finance the education. An education loan comes handy at a time like this.

The cost of education has only been increasing with time. However, thanks to the banks and NBFCs, education loans have become increasingly popular and easy-to-avail to overcome the financial challenges faced by students and parents to fund higher education.

Although, easy availability of education loan makes things convenient, you need to carry out due diligence before taking a loan.

Aim for a top institute

Banks offer loans at a lower interest rate if the student gets admission in a premier institute. Banks typically want to look at the letter of admission from the university, academic records, break-up of the cost, visa approval papers etc. If the loan amount is more than Rs 4 lakh, the bank requires you to make a down payment of 5% for admission in Indian institutes and 15% for admission in institutes abroad. Big-ticket loans also require collaterals which amount to be higher than the loan amount. However, banks often waive the collateral in case of admission into a premiere institute with good placement records.

Plan Ahead

You must start planning your loan right when you start test preparation for your course. A loan approved in advance often comes handy, especially when you are applying for higher education in a university abroad. You might be asked to furnish proof of resources or fund at the time of application. Even if you do not need to submit proofs at the time of applying for a course, you would not get more than three-four months to get a student loan sanctioned after getting confirmation from the university. Starting early will give you time to compare and zero in on the product that best suits you.

Choose Your Bank With Care

Many banks and NBFCs have jumped to the fray in the last few years to offer education loans, so getting a loan has got easier over time. However, you must try and find the one which doesn’t just offer a low rate of interest but also has the best term to pay back and allows you to pre-pay the loan. Also compare the loan products available in the market in terms of the additional costs associated with the process.

Self-finance The Living Cost

If you are planning to go to countries such as U.S., U.K., Canada, Australia etc., the cost of living is going to be higher than in India. This could inflate your loan amount if you do not self-finance a part of these expenses. You could explore alternatives by taking up part-time jobs such as working at the library or as a lab assistant etc. while studying. In fact, some universities offer these opportunities on their premises.

Avail Repayment Holiday

Repayment holiday is a unique feature of education loan. You are allowed to not pay EMI for a period of up to 12 months after the course ends or six months after getting a job, whichever is earlier. This comes handy especially when you don’t land a job immediately after the completion of a course. You can start paying EMI as soon as you find yourself in a financially comfortable position. Having said that, your interest accrues over the period you do not pay EMI, so start repayment at the earliest you can.  

The writer is CEO, BankBazaar.com

Print Rate this article:
No rating

Number of views (700)/Comments (0)

Adhil Shetty
Adhil Shetty

Adhil Shetty

Other posts by Adhil Shetty
Contact author

Leave a comment

Name:
Email:
Comment:
Add comment

Name:
Email:
Subject:
Message:
x

Videos

Ask the Finapolis.

I'm not a robot
 
Dharmendra Satpathy
Col. Sanjeev Govila (retd)
Hum Fauji Investments
 
The Finapolis' expert answers your queries on investments, taxation and personal finance. Want advice? Submit your Question above
Want to Invest
 
 

Categories

Disclaimer

The technical studies / analysis discussed here can be at odds with our fundamental views / analysis. The information and views presented in this report are prepared by Karvy Consultants Limited. The information contained herein is based on our analysis and upon sources that we consider reliable. We, however, do not vouch for the accuracy or the completeness thereof. This material is for personal information and we are not responsible for any loss incurred based upon it. The investments discussed or recommended in this report may not be suitable for all investors. Investors must make their own investment decisions based on their specific investment objectives and financial position and using such independent advice, as they believe necessary. While acting upon any information or analysis mentioned in this report, investors may please note that neither Karvy nor Karvy Consultants nor any person connected with any associate companies of Karvy accepts any liability arising from the use of this information and views mentioned in this document. The author, directors and other employees of Karvy and its affiliates may hold long or short positions in the above mentioned companies from time to time. Every employee of Karvy and its associate companies is required to disclose his/her individual stock holdings and details of trades, if any, that they undertake. The team rendering corporate analysis and investment recommendations are restricted in purchasing/selling of shares or other securities till such a time this recommendation has either been displayed or has been forwarded to clients of Karvy. All employees are further restricted to place orders only through Karvy Consultants Ltd. This report is intended for a restricted audience and we are not soliciting any action based on it. Neither the information nor any opinion expressed herein constitutes an offer or an invitation to make an offer, to buy or sell any securities, or any options, futures or other derivatives related to such securities.

Subscribe For Free

Get the e-paper free