A short explanation of education loan
Education loan is a type of loan that is specially designed for students. When a student gets into a financial crisis, he or she generally has two options. The first one is to quit college, and the second one is to arrange for the required money. One of the good solutions of gathering money is to take an education loan.
Education loan in India is made to cover all student related expenses. This means that with the loan money, the student will be able to cover the costs of books, accommodation, and other necessary things. The only thing you need to submit with the application is the proof of academic success and annual income.
The banks in India are offering different education loan schemes. If you wish to apply, you should do a detailed research. However, this loan will cover all your educational expenses, and it is available for any study program.
Things that an education loan offers
The education loan in Mumbai will provide you with money that you can use to cover your educational expenses. We all know how college can be expensive. There are various costs that you need to bear. An education loan can help you with all these costs.
Another advantage of the Mumbai education loan is the repayment method. If you get this loan, you don’t have to think about repayment until you complete your education. Different banks offer different tenures, and they will provide you at least a couple of years to repay the loan.
People usually think of personal loans when they need the money for education. There are some disadvantages of this loan. The first one is interest rate. A personal loan has a higher interest rate than an education loan. The other disadvantage lies in repayment method. Personal loans have smaller tenure, which means that a student will have to start repaying the money before the education is complete.
Things to keep in mind while availing an education loan
When it comes to education loan, you should know that they would cover all study programs. Whether you study in India or abroad, you can easily get an education loan with the right requirements. This loan is also a good way to cover expenses of any graduate and post-graduate program. We all know how big these expenses can be, especially for masters or doctorate. An education loan can cover them all.
When you complete your education, the bank offers you a moratorium period. This usually lasts for one year, and you can use it to gather money or to find a job. However, a majority of students who take this loan usually start the repayment before the moratorium starts.
Interest rates that you can get in banks of Mumbai
The government of India wants to support the students and that’s why the interest rate for education loans of all Mumbai banks ranges from 9.25% to 16.00%. The amount of the loan is decided according to the income and student’s academic success. The tenure of the education loan can go up to 10 years. This is designed to make the repayment process as much feasible as possible for students.
You can check the interest rates of the following banks:
- Indian Overseas Bank: Minimum Interest rate is 11% and maximum is 13%
- Union Bank of India: Interest rate ranges from 11.05% to 12.55%
- Punjab and Sind Bank: Interest Rate is from 9.40% to 11.90%
Where can you apply for an education loan in Mumbai?
Many banks in Mumbai are offering education loan scheme:
1. Dena Bank:
- Interest Rate is just 11%
- The maximum tenure that you can opt for is 15 years
No processing fee for students in India, while for students abroad this fee amounts to Rs 1000
2. AXIS Bank:
- Education loan Interest Rate is in the range of 15% to 17.50%
- There is a procession charge and it amounts Rs 1000
The maximum possible amount of the loan is Rs 10 lakhs for studies in India and Rs 20 lakhs for studies abroad.
3. Andhra Bank:
- Interest Rate is within the range of 10.95% to 11.40%
- If you take a loan bigger than Rs 4 lakh, the margin amounts 5%
Third party security required
4. HDFC Bank:
- Minimum interest rate is 9.50% and maximum is 15.25%
- You can take secured and unsecured loan.
- The maximum amount of unsecured loan is Rs 7.5 lakhs, and the secured one goes up to Rs 10 lakhs.
These are only some of the banks that offer education loan scheme in Mumbai. Each of them has a different loan program, so you will have to do some research in order to find the best option. There is another way to apply. Paisabazaar.com is a website that assists you for an online loan application. You can use it for any type of loan that you can find in India. The application is quite simple. You just need to enter some information:
- About yourself – residence, date of birth, etc.
- About your education
- About your income
The Paisabazaar program will use this to find suitable Mumbai loans for you.