5 things to look for when looking for a good Study Loan in India

Has the thought of a student loan crossed your mind? If it has, you are definitely thinking in the right direction. Opting for one will allow you reach for your dream education, even if it is out of bounds financially. You can pursue your further education plans without hassling parents, relative or friends for funds.

However, the only hiccup, you will find, is actually finding a financing product that’s a good match for you, especially since there are so many options available in the market today. Keeping this mind, this article will highlight 5 things you should look for when shopping the market for an education loan in India.

1. Look for loans that provide you the maximum level of funding.

Some lenders provide partial funding and require you to pay margin moneys to procure the loan. Some lenders offer 100% of the course fee as the loan amount and some take it a step further by also covering your other expenses such as examination/Library/Laboratory fees, the purchase of books, providing the caution deposit, and any other such as project work, study tours, thesis, etc.

You should go for a lender that takes care of all your financial requirement so that you can concentrate on your studies rather than worrying about arranging funds for your studies.

2. Look for Education loan with long tenures and flexible repayment plans.

After getting the funds you need, the loan you choose should make it as easy as possible for you to repay the amount. An easy repayment begins with long tenures, as the longer your tenures, the smaller the EMI amount. Also, some lenders offer different types of repayment options so that you can choose one that best suits your needs.

Some may argue that long tenures invite high interest payments in the long run, but you can always cut short the tenure of the loan by making prepayments as and when you are financially capable of doing so.

3. Look at the charges involved.

Most study loans will come with certain charges. The first and most significant charge is that of the processing fee. This can be up to 2% of the sanction loan amount. So if you are borrowing a loan of Rs. 5, 00,000 then the processing fee could be as high as Rs. 10,000.

Some of the other charges include, document handling charges, prepayment charges, late payment charges, etc. It’s a wise decision to compare the extent of these charges before finalizing on a particular lender.

4. Lastly, check the interest rate of the study loan.

After you’ve found a few lenders that provide high loan amounts along with easy repayment options and low charges, you’ll have to check which one is being provided to you at the lowest cost, which is basically the interest rate. Most lenders will provide you with interest rates between 10 and 16 percent per annum.

We hope this article will help you find the right study loan for your needs. Remember to consult a financial expert before finalizing your decision. We wish you all the best for your studies. Good luck and study hard!

An personal loan would be the first financial help for your family in your absence.