A brief guide on Education Loan for Abroad studies - 5 Steps to get the loan

Overview

Pursuing higher education from any international university or college is a dream come true for any student. Abroad studies help students gain a lot of exposure but also helps them get involved in a new and diverse culture. But the main reason that many international students cannot pursue their studies abroad is that they do not have the necessary funds to have a comfortable stay and pay the academic fees. While most institutes offer a scholarship, many students cannot meet the eligibility criteria. 

This situation forces many passionate students to look out for education loan for abroad studies. Many educational loans for abroad studies can be borrowed from a bank and returned at very little interest. This article will inform you about the various steps that are involved in taking a loan. We will also talk about the documents required and the eligibility criteria for the education loan for abroad.

5 Steps To Get an Education Loan for Abroad Studies

Applying for higher studies outside your country can be exciting and thrilling at the same time. Many candidates who go outside end up staying in the country for work even after completing graduation. But not everyone can be financially secured and do not require any help throughout this process. Here are the five steps you can follow to get an education loan for abroad studies:

1. Selecting the right bank- Around the nation, almost all the private and national banks provide various education loan for abroad studies. Therefore, choosing the right bank is very important for the candidate, and they should select the one that satisfies their needs and offers the best scheme to them. In addition, you should check the terms of the agreement and the interest rate on the education loan for abroad studies. Then make a list of all the banks you are interested in.
2. Understanding the loan terms- Before applying for any loan from any bank, you should have a thorough look at the terms and various formalities of the loan. You should also have a check at the interest rate, terms and conditions, and if there are any other hidden charges.
3. Checking out the Eligibility Criteria- Ensure you check the eligibility criteria about the education loan for abroad studies. While looking for an education loan, you should look at the eligibility criteria, so there are no rejections or errors. You should also make sure that you have all the necessary documents for the education loan for abroad studies.
4. Submitting the final application- Many banks do not require you to physically come to the office and provide you with the option to apply online for an educational loan. All the interested candidates can apply using their bank's official online portal and fill out the relevant details. After approximately 24 hours, a bank employee will contact you on the phone number that you provided in your form.
5. Waiting for the response- After submitting your application, you will receive a call confirming your form. Even if you have applied by going to a branch, they will still contact you to confirm your submission. The last step is to wait for the loan to get approved after all the formalities have been completed.

Factors to Consider While Applying for an Education Loan for Abroad

To get your education loan for abroad studies successfully approved, you should know about a list of things to consider. While approving any loan, banks consider several factors:

• The bank will ask for official academic transcripts and ask you to brief them about your educational background. In many cases, they will also consider what you will do after completing the degree from abroad.
• You should remember that the course you are going to study should be accredited, or the bank will reject your application. The bank would also like to know about your plans and how you plan on repaying the loan. They also try and get a sense of what kind of job you will get after graduating from college.
• The institute that the candidate is going to is also very important. Your institute should have a good world ranking and be considered a great institute to begin with.
• The bank will also make sure that the candidate can pay the collateral on the education loan for abroad.
  You should also cross-check the terms of the agreement, interest rate, and any hidden charges. All of these things have to be considered before selecting any bank.

Types of Education Loan for Abroad Studies

After knowing about the application process, you should be aware of the different types of education loans for abroad studies. In contrast, most education loans are generally categorised under secure and unsecured loans. Both of these loans can be made available by any public or private sector bank. Here is a brief introduction about both types of loans:

1.  Secured loans- Secured loans are the ones that require a candidate to provide some kind of collateral for the amount that needs to be loaned from the bank. These kinds of loans are generally low in interest rates but have a high processing time.
2. Unsecured loans- As the name suggests, these loans do not require applicants to pay the security deposit to get the loan approved. Unsecured loans are the opposite of Secured loans and have a high interest rate with low repayment time.

Education Loan for Abroad Eligibility Criteria

A candidate must do a bunch of things to get their loan approved by the banks. Here are the eligibility criteria for education loan for abroad studies:

• Academic background- All the banks providing you with an education loan expect you to be decent in your studies. You should at least have 60% in your 10th, 12th, and graduation. This minimum percentage expectation has been standardised by most of the public sector banks. But you do not need to worry, as many candidates with lower grades may also get the loan, as it also depends on the career scope and the institute you are applying to. You should also know that most private sector banks do not have a minimum percentile system, so a candidate can apply there if they get rejected by a private sector bank.
• English proficiency tests- You also need to provide the test scores for your English proficiency exams to get your loan approved from the bank. The Bank needs to cross-check that you have a good score as many countries and institutes have made it mandatory for international students to give the exam.
• An explanation for any gap years- The bank will also ask you why there were gap years between your last degree and the one you are applying for. This information is crucial to the bank as it will provide them with a sense of your academic history before approving the loan.

Documents required in Education Loan for Abroad Studies

You must possess a list of documents before applying for an Education Loan for abroad studies. Failing to provide any of these documents will result in the rejection of the loan application. Here is a list of things that you should have before applying for an education loan:

• KYC- the bank requires you to provide your KYC documents, including your photo identity and the Aadhar Card and PAN Card information.
• Passport- You should also have a valid passport to apply for an education loan for abroad studies successfully.
• Address proof- You should provide the bank with address proof and proof of your current living address. The same document will work if the permanent and living address is the same.
• Academic transcripts-  You should provide the bank with all the academic proofs, including your 10th and 12th certificates and an explanation for any gap years between degrees.
• Acceptance letter from the University- The candidate must submit a copy of the acceptance letter from the university they have applied to. This is a mandatory requirement that the candidate must abide by to get their loan approved.

FAQs

1- Which bank is best for an education loan for abroad?

There is a list of public and private banks that are great for education loans for abroad studies. However, a candidate must conduct research that fits well with their needs. In addition, they should cross-check crucial information like the interest rate and terms of the agreement before applying to any bank.

2- Is an education loan for abroad a good idea?

Depending on the circumstances, the candidate must decide if an education loan is a good idea for them or not. For example, if you are worried about safety, you should try and apply for a secured loan.

3- Is it hard to get an education loan for abroad studies?

It is very easy to submit an online or in-person application to any bank for an education loan. However, you must meet up with the documents required and the eligibility criteria to get approved for a loan by the bank.