Expenses covered in Education Loan 2023 –Hi everyone! Hope you are all doing well. Welcome back to another blog. So, guys are you going to apply for an education loan, and don’t know what type of expenses are covered in the loan? If yes then you are at the right platform, because in this blog I will tell you about the list of expenses that are included in the amount of an education loan. Education loans are provided to students to complete their higher education, from India or outside India. These education loans almost cover all the study-related expenses of the students or share the expenses of the student to provide them ease. So, read the whole article carefully to get all the details, related to the list of expenses that are covered in an education loan.
Types of Education Loan
You can classify the types of education loans based on location, courses, and collateral.
|Types of Education Loan
|Domestic – If you are applying for a loan to study in India.
|International – If you are applying for a loan to study abroad.
|Undergraduate – Loans for undergraduate courses.
|Postgraduate – Loans for postgraduate courses.
|Professional – Employees who pause their careers to study more development courses.
|Loan against property, deposits, and securities.
Expenses covered in an Education Loan vary reliant upon the type of loan you are taking.
Features and Benefits
Now I will tell you some features and benefits of the education that will be provided to the students;
- For local students, the financial amount of an education loan typically varies between INR 50,00,000 to INR 1,00,00,000, if the student is willing to study abroad.
- By fulfilling some conditions, all the expenses are covered by the education loan.
- Other than, tuition fees, an education loan also provides traveling and other expenses.
- For international loan payments, education loans are regularly transported through better forex rates to lower the exchange rate.
- Refunding of education loans outspreads to a range of 12 years freehold after 6 months of completion of the course.
- It is better to add your parents as joint debtors for education loans to lessen the refunding load.
Expenses covered under Education Loan
The following expenses are generally included in an education loan;
- Tuition Fees
- Cost of Living
- Exam and Studies-Related Costs
- Air Travel Tickets
- Health Insurance
Tuition fee makes the most burden on the students, so the tuition fee is wholly covered by the education loan. All creditors will provide the tuition fee which is the base of the education abroad. Even the minimum education loan chiefly provides only university tuition fees.
Cost of Living
If you are studying abroad, your living costs are occasionally higher than the living costs in India. Due to the exchange rate of the local and foreign currencies. Rent, food, local travel, etc. all the costs are enclosed in Education Loan. How much amount of the cost of living is included in the education loan, is based upon the bank or organization, that is providing the loan.
Exam and Studies-related Costs
All the study and exam-related expenses like, Library fees, books, laptops, examination fees, extracurricular activities costs, and other studies-related expenses are covered in Education Loan. Some banks are only permitted to cover these costs in the education loan if they do not surpass 20% of the whole loan amount.
Air Travel Tickets
The students that are willing to study abroad must need traveling expenses to travel to the country, where they are willing to study. Education loan covers traveling expenses from India to anywhere in the world, ranging from INR 50,000 to INR 1 lakh. So a big part of travel expenses may be covered by an Education Loan. Traveling expenses are included in the education loan after a request is made by the applicant.
Some banks also provide health insurance expenses in education loans. If it is not included, then you have to request the bank to include health insurance expenses.
What expenses are not covered under an education loan?
The following expenses are not covered by an education loan;
- Movie tickets
- personal traveling
- entertainment expenses
- While the expenses that are included in the education loan are only covered to some extent like 30% or 40%.
Factors to consider when calculating Expenses covered in education loan
Before applying you must have to calculate the amount of the education loan, you must have to require. To calculate the payment of the loan, you have to consider the following factors;
- Living expenses near the university you have been accepted
- Meal expenses dependent upon whether you can cook or not
- Conveyance expenses including public conveyance and fuel charges
- The part-time jobs near your housing so that if your visa permits you can work.
Educational Loan Eligibility
The students that are willing to apply for education loans must have to fulfill some conditions. These conditions are different for different banks, or organizations. But some general eligibility conditions are given below;
- The applicant must be at or above the age of 18 years
- The co-applicants must have a regular income resource
- Applicant must have 50% marks in the recent degree
- Students must have to continue their higher education at a recognized institute
- Students are eligible to take a maximum loan of amount Rs 30 lakhs per family.
Applicant must have to attach the following documents to apply for the education loan, in case of any missing document, you are not eligible to secure an education loan;
- Evidence of Identity through PAN Card, AADHAAR Card, or Voters ID
- Evidence of Residence through Electricity bill, water bill, LPG/gas pipe bills
- Legal Passport (not expired)
- All academic transcripts-
- Entry Test results (IELTS, TOEFL, GMAT, or GRE)
- Offer Letter offered by the university abroad that has accepted you
- A statement stating your projected cost of studying and living costs
- 2 passport-size photographs
- Preceding Loan statement (if taken)
- Bank Statement
- Details of Co-Applicant
- Student loan application form
How to get an Educational Loan?
The following steps are involved to apply for an education loan;
- Select the course for which you are going to apply
- Also, estimate the precise tuition fees you are essential to pay for that course
- Make a comparison of the several types of education loans you can apply for and select the one which provides all of your educational expenses
- After selecting the appropriate education loan, fill out the application form carefully on the official website of the relevant bank or by visiting the nearest branch of the bank
- The bank administration will reach you with all the additional information as soon as your loan gets permitted
- After you sign the final legal responsibility form the bank will transfer your loan amount to your account
Top Education Loans for Indian Students
Now I will provide you a list of the famous education loans for Indian students with the applicable interest rates: –
|Interest rate per annum
|State Bank of India
|Bank of Baroda
|Central Bank of India
|Bank of India
The interest rates must be changed depending on the bank’s statements.
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