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Cost of getting basic education and even higher education has increased a lot. In last recent years, this education sector has gone through a major change and witnessed the same in the context of fees as well. The fee for school education has increased a lot, same is the case of professional and higher education in the country. There are many parents and students who are finding difficulties to manage the increased fee for these schools and universities. In such condition, you can’t stop going to school or college, but you look for options to support your education financially. Every child is not enough bright and privileged to secure a scholarship to fund their studies in the situation of a financial crunch as the number of scholarships are limited in every school and college. In most of the cases, either these are need based or based on merits. In such condition many students are not even eligible to apply for these scholarships. For all those students who don’t have enough funds to support their studies can apply for an education loan. This loan covers your 100% tuition fee along with other expenses. Therefore, you need not to drop your education in between. Here are some useful tips which will help you to get a better education loan.
Compare financial aid offers: Once you receive your financial aid award letters, do a compare check of the offers. You should always read the entire loan documents related to the loan to understand the terms and conditions in a better way.
Borrow only what you need: If you are planning to take an education loan, don’t get tempted to get the maximum amount sanctioned as loan. Always calculate the amount you have or the cost you can bear, your scholarships if you have any, any financial award. After making calculations for the amount you have, then decide an amount you want to borrow from the bank as education loan.
Get your query resolved: If you have any questions in mind regarding your loan term, maximum or minimum amount borrowed as loan, tenure and repayment option. Also, ask about the terms and conditions and other factors such as interest rate, penalties and late fee charges while applying for the loan.
Follow the instructions and rules: Always ask questions from your financial aid officer and get your queries resolved. Also, ensure that you know all the terms and condition related to applying for the loan.
Get quotes from different banks: If you are borrowing the loan by your own, so always look for different options. There are many banks in India which can offer you an education loan. Some leading banks like, HDFC, Axis Bank, SBI, IDBI, Panjab National Bank are a few from where you can borrow an education loan.
Advantages of education loan
- You need not to drop the idea to get education in your desired college in absence of required funds.
- Different banks lend you loan at a different rate of interest. Always opt for a loan which offers you maximum benefits with lower rate of interest.
- Education loan comes with tax benefits. You can claim tax benefits when you start working. Even your parents and spouse can claim tax benefits if they are co-borrower in your education loan.
- Banks offer easy repayment options to students. Various banks offer you different repayment tenure, which might start once you start working or a few months or a year after completion of your course.
- Most of the banks offer you education loan at a lower rate of interest as compared to personal loan and other loans.
Few things to remember
- While borrowing or applying for a loan, you should always look for different options and get information from various banks regarding the tenure, rate of interest and other terms and conditions to get the best deal.
- Most of the banks promote the advantages and benefits linked with your loan, but these banks never tell you disadvantages and other consequences related with their loan.
- Due to half-baked information and lack of knowledge you end up borrowing the loan from a wrong bank or financial firm. Therefore, it is really important that you should take a well-calculated step while applying for a loan.