Study loan overseas

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Study Loan Overseas
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How to get the right education loan
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• Neither a borrower nor a lender be," William
  Shakespeare had written in Hamlet. Trying to go
  by this today, however, seems an impossible
  task.Whether it is for buying a house or a car
  or pursuing higher studies, loans are common
  today. With college fees increasing every year,
  many have no option but to opt for education
  loans. For undergraduate engineering courses, the
  fees could be Rs 5-10 lakh, while for a five-year
  medical course at a private college, this could
  go up to Rs 50 lakh. For post-graduate courses
  such as those on management, fees could be more
  than Rs 10 lakh.

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Conditions for sanctioning a loan

• While sanctioning a loan, a lender will check if
  a student has actually secured admission to a
  course, the quality of the college and the course
  (whether it is recognised by the University
  Grants Commission or the All India Council for
  Technical Education), if the student has the
  ability to secure an appropriate job after the
  course and the credit history of the co-applicant
  or guarantor. In case the loan is backed by
  collateral such as property (in case of
  high-ticket loans), lenders also consider the
  value of the property.Under education loans,
  fees for tuition, examinations, library, etc, are
  paid directly to colleges.

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If the loan amount is less than 

• Rs 4 lakh, for instance, loans for nursing
  courses, the lender doesn't seek a guarantor or
  security. For loans of Rs 4 to Rs 7.5 lakh, a
  third-party is guarantor is required, while for
  loans exceeding Rs 7.5 lakh, lenders insist on
  collateral, usually property. Defaults in
  education loans affect the credit histories of
  both the borrower and the co-borrower."The
  guarantor has to be someone other than the
  parent, with a sound financial condition. We
  insist on this because we are not sure of the
  student's ability to repay. There are cases of
  wilful default in which a student goes abroad
  after studies and does not repay the loan. In
  such cases, we recover the money from the
  parents. If there is collateral such as property
  that has been mortgaged, we can use Sarfaesi
  (Securitisation and Reconstruction of Financial
  Assets and Enforcement of Security Interest) Act,
  2002," says a bank official.

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Interest rates

• Currently, interest on education loans is between
  11.75 per cent and 14.75 per cent, depending on
  the loan amount and the college concerned. For
  premier institutions, lenders offer a discount of
  25 basis points. Public sector banks offer a
  discount of 25 basis points to female students,
  says the bank official.

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Why should you take a loan?

• While a loan might not be sufficient to meet the
  entire cost of an educational course, it could be
  a great help. "These days, many parents decide to
  let their children take education loans just to
  ensure they learn financial discipline. Parents
  tend to retain their savings for emergencies or
  unforeseen expenses," says Bohora.Usually, it
  is the first loan a student avails of and,
  therefore, by repaying on time, Study loan
  overseas can build good credit histories this
  will be of immense help when they seek to avail
  of automobile loans, home loans, credit cards,
  etc. "With timely education loan repayment
  histories, students have been building great
  credit scores for themselves. In many cases, they
  get pre-approved loans for other requirements,
  based on impressive credit scores," Bohora adds.
• Source http//www.business-standard.com/article/
  pf/how-to-get-the-right-education-loan-11406220069
  3_1.html

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