Things to Know Before Applying for Foreign Education Loan
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Studying abroad can significantly advance your career and help you achieve your goals. More than 1.3 Million Indian students are currently studying abroad and it is expected that this number will increase in the upcoming year. The easy education loan process in India is one of the key factors behind this trend.
Due to the easy process of Student loans in India, the idea of studying abroad is not limited to tier-1 cities and wealthy families. Now, students of tier-2 and even tier-3 cities are exploring options for overseas higher education. Getting a student loan is an easy task, you only need to know the process of application. Here is all the information you need to know before applying for a student loan. Also, we have mentioned some important things that you should keep in mind while selecting education loans.
Note: This information is very general and the particulars may differ from bank to bank. Please check with the bank of your choice.
Read More: Education Loan Interest Rates
Student Loan Eligibility Criteria
The first and foremost thing is to check whether you are eligible to apply for an education loan or not. The general eligibility criteria that are followed by all the banks are:
- You should be an Indian National.
- You must have a strong academic record.
- You must be seeking admission to a Professional, Technical or Other course of study. Most banks maintain that the selected course should be job-oriented.
- You must have secured admission to foreign University Institutions.
- You must be above the age of 18 years or else your parents can avail of the loan.
Eligibility of Course
- For Graduation: Job oriented Professional or Technical courses offered by reputed universities
- For Post Graduation: MCA, MBA, MS or even diplomas
- These courses could be from foreign universities or institutes approved by the state and central government.
Education Loan Amount
Whenever you take an education loan, the bank will not fund the entire amount. You will be expected to pay a part of it through your own funds and the rest will be covered by the loan.
Predict your IELTS, TOEFL, and PTE in just 4 steps!
If your total fee is Rs 10 lakh, the bank may offer to give a loan of 80% of the amount and you will have to put in the balance 20%. This is called the margin amount.
Maximum Loan Amount
Student loans always have a maximum amount that can be given.
The maximum loan amount for studies abroad is generally around Rs 20 lakh by the bank. If your tuition fee amount is Rs 30 lakh, you’ll have to manage the rest of the funds by yourself.
Education Loan Processing Fee
Some banks charge a processing fee, while others don’t. it may be a fixed amount or a percentage of the total loan amount. So if the bank charges you a 1% as processing fee, that will be an additional cost you’ll have to cover.
Expenses Considered for Student Loan
- Fee payable to College and Hostel
- Examination, Library, Laboratory fee
- Purchase of Books, Equipment, Instruments
- Caution Deposit, Building Fund, Refundable deposit
- Travel expenses
- Purchase of laptop required for the course
Student Loan Collateral
Banks may require collateral for education loans. This means you pledge an asset (like property or investments) to the bank as security. If you can't repay the loan, the bank can sell this asset to recover the funds you owe.
Generally, if the loan amount is up to Rs. 4 Lakhs then you don’t need to provide any security. If the amount is between Rs 4 Lakhs to Rs 7.5 Lakhs then a suitable third party guarantee is required. And for an amount between Rs 7.5 Lakhs to Rs 20 Lakhs, you need to provide 100% collateral security in any of form of Immovable property, bank fixed deposit, LIC policy or RBI Bonds.
Guarantor/Co-Obligant
The reason behind having a guarantor is that it puts a moral obligation on the student or his parents to repay the loan. Should you default, the guarantor will have a legal obligation to pay up. The guarantor could be –
- Guarantee of Parents
- If the loan amount is between Rs 4 Lakhs to Rs. 7.5 Lakhs, the bank may ask for a third-party guarantee instead of a security
- Wherever a loan is sanctioned to Parents, the guarantee is to be obtained from the student on attaining his majority
Documentation Required
Here is the list of documents required for education loan:
- Residence Proof or ID Proof Documents (Adhar Card, Driving License or etc)
- Academic Documents (Academi transcripts, admission letter and etc)
- Income Documents (ITR, Form 16, Salary Slip and more)
- Collateral Documents (Property papers, FD and other financial documents).
Education Loan Repayment
Repayment starts only after the course period. If the student got employed within one year after completion of the course, the repayment should start immediately after the expiry of one month from the date of employment.
If you do not secure a job within a year of completing the course, then repayment starts irrespective of whether or not you are employed.
Related Read:
Maximum Repayment period of Loan
The loan is generally to be repaid in 5-7 years after the commencement of repayment. If the student is not able to complete the course within the scheduled time extension of time for completion of the course may be permitted for a maximum period of two years. Generally, you will get up to a maximum number of 10 years to repay the loan.
That's all about the topic. We hope that you have got the information you are looking for. Students, who wish to study abroad, can get in touch with India’s top-rated loan providers and apply for an education loan through Shiksha Study Abroad.
Q: Â Is university of West of Scotland good for international students?
Q: Â What rank is Wolverhampton University in UK?
The University of Wolverhampton is one of the best universities in the United Kingdom. The university is consistently ranked among the best universities nationally and globally. For nearly 200 years, the University of Wolverhampton has been consistently providing a quality of education to students and producing highly skilled graduates. The national rankings of the University of Wolverhampton are given below:
| Ranking Body | Ranking |
|---|---|
| The Guardian University Guide 2024 | #101 |
| The Complete University Guide 2024 | #117 |
Q: Â How can I get admission in the University of Manchester?
The application process at the University of Manchester may vary depending on the course and level of study. However, here is the application process for UG and PG courses:
The Undergraduate Application Process:
Step 1: You can apply through the UCAS common application portal.
Step 2: Go to the website and select the course you are interested in.
Step 3: Ensure you meet the Entry requirements (Academic qualifications, English proficiency, etc.
Step 4: Once you decide on the course, submit documents such as SOP, Transcripts and personal statements.
Check out: tips to improve your SOP.
Step 5: You can track the application's progress through your given credentials by UCAS.
Step 6: Once the applicant submits the application to UCAS, it forwards to the University, and the admission teams carefully analyse the application document.
Step 7: The university will send you an offer letter once selected. Hence keep checking your UCAS portal for your application status.
The Postgraduate application process:
Step 1: Select the postgraduate course you are interested in from the University of Manchester.\
Step 2: Ensure you meet the entry requirements for the chosen program, as they vary depending on the course.
Step 3: Complete the online application by providing your personal information.
Step 4: Upload the required documents, such as Academic transcripts and proof of English language proficiency ( TOEFL/ IELTS). experience in your fields and references (depending on the course). You also may require Two LORs depending on the course.
To make your admission better, check out the following: How Admission Officers Evaluate your application.
Step 5: If your application is successful, you will receive an offer from the University of Manchester.
Q: Â Does the University of Essex require IELTS?
International students whose native language is not English must meet the University of Essex English language requirements to get admission. The university accepts IELTS scores as proof of English language proficiency. Mentioned below are the IELTS scores required for UG and PG admission at the university:
English Language Test | Score |
|---|---|
IELTS | Overall score of 5.5 to 8.0 with minimum of 5.5 to 7.5 in each section |
The university also accepts the score of other English language tests such as TOEFL and PTE for admission to undergraduate and graduate programs:
English Language Test | Score |
TOEFL iBT | Overall score of 72 to 114 |
PTE | Overall score of 59 to 84 with minimum of 59 to 80 in each section |
Also read: Required IELTS Score for UK Universities
Q: Â Is Hertfordshire University hard to get into?
With a 70% acceptance rate, the University of Hertfordshire is not hard to get into and follows easy selection criteria during admissions. This does not mean the university accepts all the students applying for different programs. The selection is based on academic performance, English language requirements, references, and many more. Some of the programs at Hertfordshire even demand an experience of 4-5 years. Students must fulfill the eligibility criteria to enroll in any programme at Hertfordshire University. In addition, students with average performance can showcase their relevant experience or extracurricular activities participation to increase their selection probability.
Q: Â How much IELTS score is required for Hertfordshire University?
International students coming from diverse backgrounds must prove their English language proficiency by submitting the scores of IELTS, PTE, and Duolingo at Hertfordshire University. The university demands an IELTS score of 6 from the students. Along with the IELTS scores, students can refer to the table below for all the required English proficiency score:
English language test | Minimum Score required UG | Minimum Score required PG |
|---|---|---|
6 or above | 6 or above | |
59 or above | 58 or above | |
105 or above | 120 or above |
Q: Â What is University of Wales, Trinity Saint famous for?
University of Wales, Trinity Saint (UWTSD) was founded in 2010, is a public institution for higher education and research at multiple locations. It was set up under the 1828 royal charter of Lampeter, the institution was the result of the merger between Trinity University College and the University of Wales. The institution merged with the Swansea Metropolitan University in 2013.
- Top Ranked University: The UWTSD is not ranked by any major ranking body, however as per the university ranking given on the official website of the university, it is ranked among:
- #1st in Wales and UK Top 5 Film Production and Photography
- #1st in Wales and UK Top 5 Fashion and Textiles
- #1st in Wales and UK Top 20 Graphic Design
- #1st in Wales and UK Top 5 Education
- #1st in Wales and UK Top 20 Sports Science
- #1st in Wales and UK Top 20 Mechanical Engineering
- #1st in Wales for Fine Arts
- Variety of Courses: UWTSD offers more than 300 programs at various levels including undergraduate, postgraduate degrees as well as multiple online courses.
- Highly distinguished and learned faculties: the faculty at UWTSD is highly learned and distinguished which enables students to be the best in their field of study.
- High Placements: According to Graduate Outcome data 2019-2020 quoted by the UWTSD, more than 95% of its graduates were found to be employed within 15 Months of graduation. The average salary of a graduate is not explicitly released by UWTSD, however, as per some unofficial sources the average salary of the graduates of UWTSD is approximately INR 30-35L. with the highest salary being reported as high as INR 66.5L for jobs in Financial Services.
Q: Â What is the ranking of NTU UK in terms of employability?
According to Uni Compare rankings 2024, NTU has been placed at #1 in the UK for employability. In addition to this, as per the details available on the web, some of the top companies where NTU UK alumni work are Deloitte, Microsoft, Tesco, Turner & Townsend, The Access Group, etc. Some of the industries where the alumni work are Operations, Business Development, Arts and Design, Sales, Marketing, IT, Engineering, Finance, Media & Communication, etc.
Raj Vimal has experience of 7+ years in SEO Content Writing, which includes 5+ years in the Ed-Tech industry. He has written articles about studying abroad, especially in the USA, UK, and other English-speaking coun... Read Full Bio
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The University of the West of Scotland has five modern and diverse campuses in United Kingdom. The University has welcomed more than 3,000 international students which are representing 1/3 of the globe. They also have 130 European partners who are actively in global study and exchange options through the Commonwealth universities programmes. The University also offers study abroad opportunities for UWS who are eligible for the same and also have more than 20 transnational education partners worldwide which helps them deliver UWS Bachelors and Masters Degrees around the world.