Are you thinking of taking a loan for further studies? It is easy and cheap to take education loan today compared to five years ago. This is because the Central Government and the State Governments are trying to promote education loan. Get to know more about the Educational Loan System from here.
After the Banks in India, non-banking finance companies (NBFCs) have also fallen into this business. This has increased competition in the education loan business. It has been easy to take a loan. Experts say that before taking a loan, students should know and understand every aspect related to it properly.
If you are going to take an education loan then keep in mind these things: Many private institutions have installed a bank desk on their campus for education loan. While you are choosing a course and institution, it is important to keep in mind that due to the simple process, you should not choose an institution only. Adil Shetty, CEO of Bank Market.com said, “Admission decision in college should be decided only after looking at all aspects. Which profession you want to choose in the future, this answer is important in choosing the institute.
Look at the best interest rate before taking a loan
If a student receives admission to a better institution then the bank also lends a loan at a lower interest rate.
Once you have chosen a course, you should decide how much you need to loan. In addition to tuition fees, you should keep in mind the hostel charge, mess expenses, and pocket expenses etc. Consider the loan amount only after removing the amount given by parents to the total expenditure.
Keep in mind that the course you are looking for should prove to be helpful in repaying loans. Rohit Prabha, CEO of Credit Minister, said, “Before calculating the loan, the bank assesses its ability to repay loans by looking at the course and institute of the applicants.” For this, consider the bank’s institute’s old placement dealers and average salary etc. Paw said, ‘Keep in mind that the monthly installment of the loan will not exceed 30% of your salary.
‘Investigate interest rates’
You should consider different bank interest rates for education loans. You can also get help from NSDL’s Vidyalakshmi portal. Here you will get detailed information about different bank loans and other offers.
Keep track of loan repayment period
After finishing the course in the education loan, you should also know about repaying the loan. Some banks start the monthly installment process after 12 months of the end of the course, and some banks have been in process for six months.
Keep in mind that you also have to pay interest for this period. Shetty said, “To reduce the burden of interest, it is necessary to start its monthly installment as soon as your studies are completed. Since it can be the first loan of your life, according to this you can make your credit history even better by paying it on time.