The cost of quality
education is increasing with each passing day. As a result of this, many
students find themselves taking an education loan and then repaying it after
the completion of their education. This can make a serious hit on their savings
and of course, the burden of debt keeps hanging over their head. An easy and
convenient option to get out of this situation is provided in the way of
student loan refinancing. In this article, we look at five reasons why you
should consider this option for repayment of education
loans:
• Lower
interest rate: The biggest
advantage of student loan refinancing is that it reduces the amount the applicant
will have to pay as interest while repaying education loans. The interest rate
provided during the student loan refinancing can be up to 100 basis points
lower than the original loan.
• Lower EMI: As education loans add the interest amount in the monthly
installment. A reduced interest rate (after refinancing the loan) will of
course bring down the installment value. This can make the life easier for the
applicant and reduce the financial burden on him/her.
• Flexible
repayment & tenure: Student
loan refinancing could also allow the applicant more time to repay the loan
through extended tenures. This will also result in a lower EMI during the
repayment process. This allows the applicant to save more and live without the
stress of not being able to cope with the loan installment every month.
• Low/Zero
processing charges: Along with all the advantages stated above, the
process for student loan refinance is also quite low. Some lenders also provide
this facility at zero processing fees! So basically, you can switch from your
old education loan to a new one at lower interest rate with a lower installment
and get longer tenures. This makes for a very good proposition for any
applicant who has been having problems with the repayment of their education
loans.
• Top up
facility: One of the added
advantages of the student loan refinancing scheme is that while providing the
applicant the amount to pay the education loans at lower interest rate and
providing flexibility in tenure, the lenders can also provide a top up
facility. This means the applicant can get loan amount over and above the
outstanding education loan amount. The additional amount provided at the lower
interest rate can be very useful to the applicant and can be used for any
purpose he or she pleases. This also helps the applicant to reduce his number
of repayment commitments as the installment of both amounts is combined.
So, as we saw in
this article, student loan refinancing is a very useful option to consider by
people struggling to cope with the repayment of their education loans. We hope
this article was helpful to you and informed you about student loan refinancing
and how useful it can be in repayment of education loans. Have a great day!
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