Why it is always a good idea to opt for an education loan in India.
Posted: May 14, 2019
Even though more and more students turn to an education loan in India, some students turn a blind eye to these finance solutions. They’d rather borrow from friends & family or give up on their dreams altogether than borrow. They are afraid of debt and think they’ll go in over their head by taking a student loan. This article will tell you why this is not the case and why it is always a good idea to opt for student loans in India.
1. They offer 100% financing.
Other loans such as home loans & motor loans require you to provide some part of the total cost from your own pocket. This is not the case with a majority of the student loans in India. Most NBFCs will provide 100% financing to deserving students. They won’t even ask aspirants to secure their loan with collaterals.
2. They cover all education-related expenses.
Not just the course fee but all other education-related expenses will be covered. They won’t leave any stone unturned to help you achieve your dreams, from living expenses & travel expenses, including airfares, to the fees for your entrance exams. Some will even provide financing to cover deposits and the purchase a new laptop & the study material required for the course.
3. You don’t have to worry about repaying the loan.
That’s right, unlike home loans, personal loans or motor loans, with an education loan in India you don’t have to worry about repaying the loan until much after you’ve borrowed the loan. In fact, the repayments begin only six months after you’ve landed a job or wrapped-up your course. Till then, not a single repayment has to be made. You can choose to pay the EMIs if you want, you could also choose to pay only interest; it all depends on your financial capacity.
4. These loans reward you.
Again, there is probably no other loan out there that rewards its borrowers but an education loan in India will! Most distinguished students or aspirants that have always done well academically in their life will be eligible for lower rates, higher loan amount or even nil processing fees. On the hand, do motor loan reward you maintaining a clean driving record or do home loans give you leeway for paying your rent on time and diligently, nope!
5. Tax benefits.
They might not be useful for you if you do not have a taxable source of income, but the tax benefits of an education loan in India will be very helpful for your parents (provided they are the guarantor of your loan). In fact, they can use the interest paid in a year to knock off an equal amount from their taxable income. The best part is that there is no limit prescribed for the amount that can be claimed for deductions and this all made possible by section 80E of the Indian Income Tax Act.
So if you’ve had your reservation about an education loan in India, we hope these pointers help you reconsider your abstinence and pursue your dream with the help of these financial solutions.
Good luck and all the best!
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