some frequently asked questions about education loan in india

    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:
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.
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.
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.
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 application
Passport 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.
Details of Assets & Liabilities of parents/guardians/guarantors
In 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

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.
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 education 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.

Education Loan Repayment Tips

Timely education loan repayment is extremely important to keep your credit rating good and avoid extra interest costs. Meticulous planning is extremely necessary to repay the education loans faster. Students who have taken an education loan should compulsorily plan to save more every month after getting a job, so he/she collects corpus in order to pay loan faster. Education loan in India has a 5-7 years repayment period, so the installments are not that high and can be paid easily. Let’s take a look at some tips that can help you pay education loans faster.

Using the moratorium period:
The education loan repayment does not start immediately. Banks levy simple interest on student loans during the moratorium period and course of study. The amounts add up and increase the debt burden. You can pay the interest levied on the principal amount during the moratorium period. Paying interest during the course of study will lower the repayment installments after the moratorium period is over.

Get a job:
Waiting for your dream job is not always a good idea. The employment scenario changes with the economy. An economy slump causes losses of thousands of jobs and it may take long time to get a suitable opportunity. Therefore, you should judge the scenario and take up some job until you get your dream job. Having some job is better than not having one, especially when you have an education loan to repay. Take up job even if it is in sales, there are several things to learn and your experience will grow with every day you spend on a job. Besides having a job also means you will be able to pay education loan repayments on time and clear off the debt early.

If you are finding it difficult to find a good job after completing your higher education or the education loan repayment installment is high, you can consider refinancing your education loan or restructuring it by approaching the bank. Many banks will agree to refinance the loan if the employment market is downward during the repayment period.

How to get Education loan in India?

With the cost of higher education abroad rising every year, parents have no option but to apply for education loan to enroll their children in a foreign university. There are several misconceptions about student loan offered by banks and financial institutions. Majority of the fears associated with the education loans are far from truth. Getting education loan in India is not complicated as thought to be. The eligibility, payment terms, interest rate, tax rebate and terms of loans are some of the important loan elements that you should focus upon while applying for a student loan. Let’s take a look at some of these important elements of the student loan and know about the procedure to get an education loan in India.

• Eligibility: Only Indian resident aged between 16-35 can apply for a student loan. The applicant must have secured admission to the professional or technical course before applying for the loan.
• Repayment terms: the repayment of education loan in India generally starts six months after taking up a job or one year after completing the professional course whichever is earlier.
• Tax rebate: The Government of India offers tax rebate on the interest you pay on the education loan. The tax rebate is based on Section 80-E of the Income Tax Act 1961.
• Term of loan: the term of the loan is generally 7 years which also includes the period when the borrower is not required to make any repayment.
• Interest rate: the interest rate of education loan is generally in the range of 15%-18%

The above given information is only general. Every bank and financial institution has their own terms and conditions, interest rates and eligibility criteria for the student loan. The maximum loan amount you can get differs with the financial institution offering it. For education loans above 7.5 lacs, you need to present collateral.

To get an education loan, you need to visit the financial institution or bank which offers student loan. You can talk to education loan consultant hired by the financial institution who can give you clear idea about the eligibility criteria and the procedure to apply for the loan. You need to carry your educational documents including the application of the foreign university in which you want to enroll. If you are applying for an education loan above 7.5 lacs, your guardian or the parent has to sign as co-applicant for the education loan. The role of the co-applicant in the loan process is that of the primary debtor. The financial institution may also ask for additional security as collateral if you are seeking 100% education loan. The education loan will be only granted after you present University’s fee demand letter.

Some banks and financial institutions have their list of approved educational institutions and professional courses. The loan procedure is simple and more quick if you are seeking admission in their approved list of educational institutions. So, if you have secured admission in foreign university and looking for an education loan in India then head towards any bank or financial institution that offers education loan for higher studies.

Source: http://benoyj.hubpages.com/hub/How-to-get-Education-loan-in-India

Avanse Education Loans

India is a major hub for education, both mainstream as well as new age careers. The career opportunities available today are many. The need of the hour however, is financial support that helps students pursue the careers of their choice, without having to compromise for want of it. At Avanse, we understand this and offer simple and hassle free education loan to pursue your graduation or post graduation in India.

Avanse Education Loan for Working Professionals: An ambitious, young corporate professional like you always aspires for more from life. We understand your desire to quickly move up the corporate ladder, which is why we offer Executive Education loans for Executive/Professional Based Programs, to equip you and help you achieve your goals.

Avanse Study Abroad loans: In the endeavour to build a career and a future, you may often have to leave the comforts of home behind and reach for foreign shores. This obviously entails a huge financial investment. Avanse understands this predicament and keeping in mind the aspirations of the student and parents, offers education loans that are hassle-free and student-friendly. Studying abroad has never been easier.

Make the Right Choice: Avanse is a new-age education finance company. We pride ourselves in being pro-student, with an outlook that seamlessly combines technology and empathy. We are agnostic to the choice of careers and are open to financing modern day courses, hitherto shunned or ignored by other financers.

However, we are more than just a financier. We understand your aspirations and goals and have designed loan products to suit diverse needs. We believe in enabling careers and go the distance by mentoring and guiding you along the way. The Avanse Edvantage is the extra edge or advantage we offer, demonstrating our resolve to help you create a future without limits.