Steps to Avail the Right Education Loan

At times, even the meritorious students struggle to get proper education due to the financial restrictions. Often people take a personal loan for higher education. Acquiring an appropriate loan of education is a good option, but one needs to go through a certain process to avail the same. There are many financial lenders out there that provide education loans with varied terms and conditions. But being aware of the fundamentals allows you to get the right financial assistance to facilitate your kid's education.

1. Determine your Affordability

Before you reach out to the lenders, check whether or not you are confident enough to pay back the loan amount. Check the placement opportunity that the particular course provides, and the salary you will be getting at an entry-level. You have to repay the loan once you are finished with your education. Therefore, you need to determine whether you will be able to pay back the amount that you have taken as an education loan or personal loan for higher education.

2. Filter Out the Lenders

There is no dearth of financial lenders that are ready to provide you with an education loan. To filter your option, you have to determine whether you are qualified to get the loan with that particular lender. Check the personal loan eligibility and education loan for different courses and lending institutions.

Furthermore, you should also determine the cost overheads covered by the lenders on their loan. The costs that lenders do not cover, you will have to pay. Therefore, make sure you are capable of paying the same.

3. Loan Eligibility Amount

Similar to personal loan eligibility amount, education loan also has certain limits to the amount you can avail. The eligibility criteria to avail of an education loan vary based on different factors. For instance, for courses based in India, you can get up to Rs. 10 lakhs, whereas for overseas courses, your education loan limit is set at Rs. 20 lakhs.

Liaise with different financial lenders and check out the loan amount they are willing to offer, the interest rate they cover, and the overhead cost they are covering. Evaluate different options and select a lender that offers the required loan amount along with lower interest rates and cover maximum costs.

4. Consider the Moratorium as well as Interest Servicing

Contrary to other types of loans, EMIs for education loans do not start immediately. Financial lenders typically provide you with a moratorium period that ranges between 6 and 12 months.

Moreover, if parents managed to pay interest during the moratorium and course period, then the EMI will be solely based on the principal amount. If you are unable to pay interest during this time, then EMI will be calculated based on the principal amount and accumulated interest.

Education Loan – The Stepping Stone to Get Quality Education

Applying for the right education loan proves to be beneficial for parents as well as students. For parents, it provides financial assistance to give children access to better education. And for students, education loan provides the opportunities to take a big step towards a brighter future. A great thing about education loans is that it is applicable to all students.

Additionally, education loan is applicable to almost all courses, including graduation, diploma courses, post-graduation, vocational courses, etc. Based on your requirements, you can easily avail of an education loan.

Moreover, an education loan covers many expenses that turn out to be heavy on your pockets such as hostel fees, examination fees, tuition fees, laboratory fees, library fees, caution deposit, travel expenses, etc. Above are certain key considerations that you should look into so that you can make a well-informed decision.