Study loan : Some Frequently Asked Questions About Education Loan In India

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Study Loan
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Some Frequently Asked Questions About Education
Loan In India
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• People often have few doubts before or after
  taking education loan in India.  Here are answers
  to some common questions that people have with
  regard to student loan

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Who is eligible for Education Loan?

• The person taking the loan should have secured
  admission in the institute. The institute or
  course of study must be recognized by
  UGC/AICTE/AIBMS/ICMR, etc. The person needs to be
  an Indian citizen and should be 17 years old or
  above.

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What are the courses covered for Education Loan?

• Education Loan in India is available for all
  approved courses leading to Graduate/Post
  Graduate Degree and PG Diploma conducted by
  recognized colleges/universities recognized by
  UGC/AICTE/AIBMS/ICMR, etc. Education Loan is also
  available for part time courses and job oriented
  courses subject to employability and earning
  potential. An education loan for study abroad is
  also available for job oriented
  professional/technical courses offered by reputed
  universities.

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What are the expenses covered under Education
Loan?

• The amount of Education Loan is provided to meet
  all type of expenses which are necessary for
  completion of course that  includes purchase of
  books, equipments, computer, travelling, study
  tours, boarding, lodging besides all types of
  fees.

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What are Documents required while applying for
Education Loan?

• Some banks or financial institutions require all
  or any of the following documents as pre sanction
  documents
• Loan applicationPassport size photographs.Proof
  of Address.Proof of Age.Copy of PAN of student
  Borrower.Proof of having cleared last qualifying
  examination.Letter of admission.Prospectus of
  the course wherein charges like Admission Fee,
  Examination Fee, Hostel Charges etc. are
  mentioned.

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• Details of Assets Liabilities of
  parents/guardians/guarantorsIn case loan is to
  be collaterally secured by mortgage of IP, copy
  of Title Deed, Valuation Certificate and
  Non-encumbrance Certificate from approved Lawyer.
• Photocopy of Passport Visa in case of study
  abroad.Any other document/information, depending
  upon the case and purpose of the loan

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What is moratorium period or grace period?

• It is the maximum time given to the student after
  finishing studies that go without catering any
  payments for yr loan. Mostly, it range from 6 to
  12 months.
• What is the repayment tenure of an education
  loan?
• The repayment tenure depends on the amount of
  loan taken and type of course. The minimum time
  given to repay the loan is 1 years and maximum is
  10 years.

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• Is guarantor mandatory in education loan?
• Yes, guarantor is mandatory in education loan.
  The guarantor could be an applicant's parents or
  guardians who take the responsibility for the
  repayment of loan in case of any mishap.
• Is there any tax benefit by taking an Education
  Loan?
• The moment a person start repaying the study
  loan, he/she can deduct the interest amount from
  the total income while calculating tax. This
  means the effective interest rate on the loan
  works out to a lower amount.

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