In this article we will discuss What is Student Loan and its features and benefits. Many people believe that obtaining a college degree is a prerequisite for achieving success in life. Investing in higher education will result in a well-paying and rewarding career.
Many students face financial difficulties in pursuing this goal. While there are various financial aid programmes available, such as scholarships, grants, and work-study programmes, the cost of attending college has risen significantly in recent years. Even more so, if you intend to study abroad, you should budget for additional costs.
Students can obtain a loan to pay for their education, which opens the door to more opportunities and allows them to realize their full potential and goals. All Scheduled Commercial Banks in India are required to follow the education loan scheme, which assists students with exceptional ability to pursue higher education in India and abroad with funds at reasonable terms and conditions.
Student loan: Overview
- 1 Student loan: Overview
- 2 Banks frequently consider the following factors when approving student loans to assist students:
- 3 Benefits of Student Loans
- 4 Documents Required for Student loan
A student loan is a sum of money borrowed from the government or a private lender to fund education-related expenses such as tuition, tuition remission, and other expenses for post-secondary courses and degrees.
When it comes to loans, the government has lower interest rates and payback terms, and you only have to pay back after a certain time period or income level has passed. We are required to refrain from taking on new tasks during this time. This type of loan is intended to cover tuition, housing, books, supplies, exam fees, travel expenses, and any other non-mandatory expenses.
For students studying in India or elsewhere, India has numerous student loan programs. Additionally, some banks offer credit cards to educational loan customers. In India, student loans are only granted to qualified applicants.
Banks frequently consider the following factors when approving student loans to assist students:
- Only Indian citizens are eligible to apply.
- Applicants must be between the ages of 18 and 35.
- Academic success is critical.
- One must have been accepted into a nationally or regionally accredited college or university.
- Education loans are only available from financial institutions that offer these educational programs
Benefits of Student Loans
With an education loan, you can relieve your family’s financial burden while also protecting your investment funds by depositing them in a bank. In addition, an interest-free loan for education qualifies for a tax rebate under section 80E of the Income Tax Act.
Pay after completion
Students are only required to pay EMIs after completing their program of study, so you don’t have to worry about paying right away. The repayment schedule is also useful when planning long-term family finances.
Several funds are included.
Tuition, housing, textbooks, a laptop, and other expenses can all be covered by study abroad loans. As a result, these additional non-fee expenses will not put anyone in financial jeopardy.
Improve your financial knowledge.
Focusing on paying for your education while not having to rely on your family can be a fantastic opportunity for students. In addition, while repaying a loan, child will begin to build their credit history. They will be able to receive lower interest payments in the future if they have a good credit history.
Documents Required for Student loan
Normally, banks will require the following documents to be completed:
- Loan application form duly completed
- A recent photograph of the applicant and the co-applicant is required.
- Proof of Age
- Photo identification (PAN/Aadhar/Driving License/Voter ID)
- Proof of Address, Signature, and Admission (Admission letter with fee-break up)
- Marksheet (10th/12th grade/graduation/GRE/TOEFL/IELTS, as applicable)
- Proof of income (of co-applicant)
- Bank statements for the previous six months
- Income tax returns for the previous two years, along with income computations
- Balance sheet audited for the previous two years
- Service tax return/sales receipt as proof of turnover
- Documents used as collateral