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Common Questions About Education Loans For Students

Posted by nikkis2108 on May 7th, 2020

You've passed your entrance test and are looking to now enroll in the course that's right for you. However, the problem of financing still exists like a huge wall between you and your aspirations. While good grades are important, they are no substitute for an actual college fees, especially with the current cost of higher education. Hence, the most viable option is education loan for students.

The first step to funding your higher education through a loan is to understand every part of the loan process. Each year, millions of applicants approach various lenders to get financial support for their higher education. Hence, making sure your application gets approved seems daunting. However, knowing the basics of education loans for students can prove to be very helpful. Hence, here are some common questions that can help you:

Am I eligible for a student loan in India?

Eligibility requirements for education loan for students differ slightly from lender to lender, but many institutions have similar criteria to help ensure responsible lending and utilization of funds. Common eligibility criteria include:

  • Borrower and co-borrower must be Indian citizens
  • Borrower must be 18 years of age or older
  • Borrower or co-borrower must have an active account
  • Borrower must be able to confirm admission at a college

How much can I borrow?

Institution and course are generally the decisive factors when it comes to the amount of the loan. However, lenders typically cover all tuition fees and maybe other expenses depending on the loan package. These expenses include living expenses, books, lab fees, exam fees, etc. Some lenders also cover the cost of travel in case of abroad studies.

What is margin money?

Margin money is the amount that the borrower has to bring for the total expense of higher education loan. Lenders use margin money as a way to ensure students practice caution in spending loan money wisely.

How do I receive my loan funds?

Tuition fees are sent to the institutions directly on your behalf, with loan money related to other expenses dispersed in installments throughout the life of the loan. However, there are lenders that hand you over the money to spend as per you’re your requirement.

As for the medium of payment, funds of an education loan for students is paid either through bank transfers, cheques, or demand drafts.

What are loan repayment terms?

Repayment terms state how a borrower will pay back the money used for his or her education. In case of an education loan for students, lenders offer a moratorium period. In this period, the borrower does not have to make any repayment. Hence, actual repayment typically begins six months to 1 year after the completion of a course or securing employment, whichever comes first.

Having questions about education loans is completely normal for both students and their parents. In fact, the more questions you have, the more likely you are to look at every details of your study loan scheme. This means that the education loan you finally choose is likely to be the best for you. Hence, make a list of every little question you may have and go through them with your lender.

RELATED ARTICLE : All You Need To Know About Education Loan For Study In India

Also See: Education Loan, Higher Education, Margin Money, Education Loans, Loan, Education, Borrower

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