As education and universities are getting costlier, the need for financial aid to continue studies is also increasing. Students usually resort to two options, i.e., scholarships and educational loans.
An education loan is basically a loan that is taken by students to cover their tuition fees, accommodations, books and other educational needs. A lot of banks and financial institutions provide loans for students at a pretty low interest rate so that they can easily be repaid later. It is a mutual try of the government and lenders to assure good education for all its students.
Requirements: An educational requires a few basic documents such as age proof, signature proof, identity proof, residence proof, a complete application with correct details and a recent photograph with a signature across it. The other requirements vary on the fact whether the loan is for studying in the home country or going abroad.
The main requirement, however, is a co-applicant. They are required to finance the course for the applicant in case they are unable to repay the cost and act as the guarantor. This is because students who take the loan are usually young and aren’t working at that point of time.
Eligibility Criteria: First of all, the applicant should be a citizen of the country in which he would be applying for the educational loan.
In most banks and financial institutions, the eligibility criteria for the loan is a minimum particular percentage that the student must have scored- which most commonly is 50% during High school as well as graduation. The student must also have a degree in case he/she has completed graduation. Credits and achievements of the applicant are also taken into consideration.
Another criterion is that the applicant must have attained admission in the host country or abroad through an entrance exam or some merit based examination and gone through the selection process to be qualified.
Sometimes, there is an upper limit of age fixed for the applicant beyond which a person won’t be eligible for the educational loan.
The course that the applicant is taking the education loan must be a part of a recognised and accredited university anywhere in the world and should be a job oriented course which could be a professional degree, diploma or technical course. Loan can also be applied for to be a part of any course conducted by a recognised and certified organization. However, loans are usually not given for part-time courses.
The bank or financial institution will take into account the collateral that the student will be able to provide against the loan. Also, whether or not the co-applicant is credible and financially stable can also be a determining factor for the bank to provide the loan.
Thus, if one wants an unhindered academic life without having to worry too much about the repaying value, they should go for an educational loan. It covers all needs of the applicant and with time, the rates of interest on these loans are also decreasing. One should check all requirements, where the rates are the lowest and also, only approach trusted banks or financial institutions for this purpose.