The decision to continue
with further education is a bold one, and even bolder when you have decided to
continue your studies abroad. It is very exciting on facing a new challenge,
but one should make sure to sort out their funds in order to make this dream a
reality.
Educational loans help the
students in achieving their academic dreams, but there is still a lot to know
and research before going ahead and taking a loan. This article will shed light
on information you need to the best loans for your needs.
There are many options
that the student can choose from for when it comes to educational
loans studying abroad, hence
thorough research should be done on the different loan options. One major
decision that the students have to make in order to get the best educational loan,
is to choose between taking a loan from a bank or from a non-banking finance
company (NBFC).
Verification
process-
1. Banks
Banks usually have a list
of universities that they recognize for which they sanction the loans, but they
may also be ready to give out loans if the course offered by the university
gives the student good employment opportunities. Based on factors like the
reputation of the university, the value of the course and the employment
opportunities it generates, the bank then decides the terms and conditions of
the sanction.
2. NBFCs
When it comes to NBFCs,
they are a lot more flexible when it comes to giving loans as compared to
banks. They are much less restricted in terms of the choice of course. Even the
NBFCs have a verification process where they check the students’ entrance exam
results, their stream, the course they want to pursue, and the university that
is offering the course. They agree to sanction loans to unconventional and
vocational courses like sports engineering, music, animation, painting,
theatre, dance, language, data sciences and other new-age technology courses.
Compare
the options- To get the best educational loan, be sure to
check with more than one lender so as to get an idea of the different rates you
are being offered. This will help you get the best education loan as you can
then choose the best loan among the different options offered to you. The
factors that you need to make sure of while looking to get a loan are as
follows:
The
interest rates- When it comes to the
interest rates applied on loans given by the bank, they were linked to the
bank’s base rate. But since 1st April 2016, interest rates are linked to the
bank’s marginal cost of funds based lending rate (MCLR). NBFCs do not follow
the concept of MCLR, they set their rates based on the current competition and
their fund costs. So you should compare which is more suitable for you to go
with accordingly.
Repayment
options- The repayment
options for both the banks as well as the NBFCs are similar. Ideally, all the educational loans have many repayment options. There are many options that you
can choose, like starting the EMIs after 6 months of completing the course, or
you can also start paying before that to help clear out the loan amount
faster.
We hope this article has
helped you, all the best!
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