4 Steps To Get The Right Education Loan

  Author: Naveen Kumar

If you are a meritorious student, a dream career is not out of reach if you cannot afford to pay for a certain course. An education loan can help you pursue higher education course of your choice. The same is true for your children. At the same time, it is important to take the following four steps to get the right education loan.

Step1

Examine if you can afford an education loan

Only if you are confident that you can repay the education loan, go for one. If you are taking up the course and planning to repay the loan, check essential details such as placement record of the course and entry-level salaries. In short—the future pay off should be worth the bother of taking the education loan.

Step 2

Shortlist lenders

 You can start the short listing process by checking the eligibility of your institution and course for education loan by different banks. Next, check the cost heads covered under the loan by the lender. Remember, what the loan doesn’t cover will come from your own pocket.

Step 3

Check eligibility for the loan amount

If you have opted for a course in India, the upper limit for the loan is Rs 10 lakh. This goes up to Rs 20 lakh for overseas education. Select the lender offering you the loan amount which you need, covering the cost heads and that too, at the lowest interest rate.

Step 4

Decide on moratorium and interest servicing

Moratorium is a period typically after the completion of the course during which the lender does not ask you to pay the interest on the loan. The interest is added to your loan amount. Find out the moratorium period which is typically 6 months to 1 year. It helps if your parents or you can pay at least the interest during the study period to keep the loan amount manageable.

Remember, the right education loan is the stepping stone to a bright future.

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