State Bank of India have declared to raise its loan amount by approximately five times by now and now is offering a big amount for education loans i.e. up to 1.5 crores for the students who wish to go abroad for their higher studies. As in most of the cases, this is the first loan one takes in his/her life so be cautious while taking up a loan because it may interest you to know that it may forbid your credits even before the time you actually start earning.
So, we are going to discuss some values that can help you zero options that will suit you the best.
Maximum loan (India) – up to 10 lakh
Maximum loan (Abroad) – almost all of the banks have restrictions or upper limit you can say up to 20 lakhs but some banks are extending their upper limit to Rs 1.5 crore.
Interest rate (abroad) – 10.8-13.5% (varies with lender)
Collateral – not required for loans to a limit of 4 lakh.
(For loans between the value of Rs 4 lakh and Rs 7.5 lakh, lenders might ask for a third-party guarantor. This can be abandoned if they are persuaded with co-borrowers repayment capacity.)
(For loans above Rs 7.5 lakh, lenders might ask for additional materials for security like property, mutual funds, insurance etc.)
Things to watch out
Keep in mind to choose the university which offers placements so that within 6-8 months after graduation you might get a job and start repaying the loan.
- Check whether the university has relations with banks or non-banking financial Companies (NBFCs which interests higher as compared to banks).
- Such relationships may speed up the loan processing and result in a lower interest rate. Enquire about the margin money i.e. what you need to pay out of your pocket. Consider getting a loan before the admission so that it can be approved and it will surely strengthen your applications.