Everything You Need to Know About Education Loan Schemes in India
Overview of The Education Loan Schemes
Education is the beacon of light that illuminates an individual’s life and society as a whole. In pursuit of quality education, many aspirants seek education loans to finance their dreams. An education loan plays a pivotal role by providing financial support to students for pursuing higher studies in India and abroad. In India, the idea of providing assistance to students in need of financial aid came into prominence with the education loan schemes introduced by various banks and non-banking financial companies (NBFCs).
Understanding the Education Loan Schemes in India
The education loan in India is generally provided for higher education, including professional or technical education. Different banks have different schemes, interest rates, loan amounts and tenure. However, all banks operate under the broad guidelines provided by the Reserve Bank of India and the Indian Banks’ Association (IBA). The education loan usually covers tuition fees, hostel charges, cost of books, and other necessary expenditure of the study course. The loan repayment starts once the course period is over, and the borrower gets a grace period for job searching.
Role of Central Government and Reserve Bank
The government of India and the Reserve Bank have established several initiatives to promote education loans. The Indian Government introduced a Central Sector Interest Subsidy Scheme (CSIS) in 2009, aiming to provide full interest subsidy during the study period to economically weaker students. The Reserve Bank, on its part, also classified education loans as a part of the priority sector lending.
Education Loan on Property: A Detailed Insight
Education loans on property are a unique form of loan where your property (residential/commercial) can be used as collateral or security against the loan. This type of loan is ideal for individuals requiring a higher loan amount for overseas education or expensive courses in India. The loan amount in these cases can go up to Rs. 3.5 crore, depending upon the value of the property.
Property Documents Required for Education Loan
When applying for an education loan on property, it is imperative to be aware of the list of property documents required to ensure a smooth and hassle-free loan processing application.
The documents required are:
1. Proof of Identity: Documents like PAN Card, Aadhaar card, Voter ID, etc.
2. Proof of Residence: Documents such as Electricity bill, Ration card, etc.
3. Proof of Income: Salary slips for the last 3 months, Form 16 and Income Tax Returns (ITR).
4. Property Documents: Property title deed, Encumbrance Certificate, property tax receipt, etc.
5. Academic Documents: Admission offer letter, fee structure, mark sheets, etc.
Your lender might require additional documents, and it is advisable to get a detailed checklist from your bank or NBFC.
Factors Affecting Education Loan
There are several variables influencing the sanction of an education loan in India, like:
1. The reputation of the educational institution.
2. The applicant’s academic background.
3. Loan repayment capacity of the co-applicant.
4. The collateral or property value, in case of loans on property.
5. The type of course (graduate, post-graduate, diploma, professional).
Securing an education loan is now hassle-free with the Bajaj Finserv app. Its easy-to-use interface facilitates swifter funds, eligibility checks, and transparent repayment options. Users benefit from instant updates and guidance, empowering them to maximize property assets efficiently and make informed financial decisions.
Conclusion
In summary, education loans in India have played a significant role in promoting higher education, especially for the economically weaker section. These government and non-government schemes aid students to realize their dreams and build successful careers without the burden of finances. In the pursuit of utmost financial assistance, education loans on property serve as a great boon providing higher loan amounts.
However, being aware of the education loan schemes, the application procedure, and the list of property documents required for the loan application can significantly streamline the process and make it a stress-free experience. Remember, education is a crucial cornerstone in an individual’s life and strategizing financial aspects with aid like an education loan only bolsters the base for a successful future.