Education in a reputed university abroad is a dream of many Indian students. If you have planned out your education and career and a foreign degree fits into the scheme of things perfectly, then whether or not you have the means to fend for a course abroad, you need to go for it.
At these times, student loans really come in handy as they ensure that no brilliant student suffers due to the lack of money. Loans with reputed institutions can now be taken easily as long as proper documentation is adhered to. Here is all that you must keep in mind before applying for a student loan:
Compare interest rates: Banks in India offer student loans for studies abroad at different interest rates. For e.g., while one private Indian bank offers a loan of up to Rs. 20 lakhs at an annual interest rate of 15%, a public sector bank offers an interest rate of 13.75% for amounts between 4-7.5 lakhs and 11.75% for over Rs 7.5 lakhs. However, there are different coverages under the loan that must also be considered, like inclusion of tuition fees, travel expenses, cost of hostel, cost of books etc. which are a part of the loan clauses. The loan that overall suits your requirement must be pursued.
Check for banks in liaison with your future institution for concessions: Certain universities abroad are recognized by some of the leading lenders in the country and have a student loan liaison with them. Always check this aspect before taking up the loan. You may also want to consider the fact that the loan amount that you apply for and may not really match the actual amount you receive owing to currency rate fluctuations. Therefore, for forex requirements, always choose a currency exchanger that hedges you from the market fluctuations by offering ‘live rates’. BookMyForex is one such online currency exchange marketplace offering live and real-time forex rates.
Keep all documents ready: A loan is a complicated process and wherever money is involved, documentation will be involved. As you survey the banks for their loan process, also check on the list of documents needed for applying for a student load for overseas education.
You will need a cosigner: Any student loan for a value over Rs. 5 lakhs will require a cosigner. This person is mostly a parent who will be a joint owner of the loan and will have to agree to pay the debt in case you are unable to pay back the loan on time. The cosigner will need to have a good credit record and will also need to submit certain documents for your loan to get through.
Check for repayment period clause: Most loans have a moratorium period after which you are needed to pay back the money through EMIs. Check this clause carefully as you need to arrange for the money to be paid back after the said duration and accordingly arrange for it or pick up a part time job.
Banks are extremely cautious while disbursing the loans owing to the bad loans that they have to suffer. So, keeping your papers in order may help you to speed up your process and take you a step closer to your dream of studying abroad.
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