Can I get a study abroad loan. Without collateral?
Asked by Aparna Radhakrishnan about 1 year ago
Yes you can, An education loan for abroad studies without collateral is even more attractive, as it does not require any form of security when applying for an education loan. There are numerous banks in India offering an abroad education loan without collateral.
Education loans provide significant financial assistance to students who are unable to pursue their education in India or abroad due to financial constraints. It is estimated that millions of students would not have been able to attend the universities of their choice if education loans had not been available. However, not everyone will be eligible for an education loan abroad without collateral, as lenders reject many loan applications. The Credit Guarantee Fund for Education Loans backs the Indian Banks' Association's model education loan programme (CGFEL). You can borrow up to Rs 7.5 lakh under this scheme with no collateral or third-party guarantee. The IBA created the 'Model Education Loan Scheme' to provide financial assistance to deserving students who wish to pursue higher education in India or abroad. For the CGFSEL educational loan scheme, banks generally follow the IBA guidelines. However, they provide loans under the scheme based on their own internal rules. A collateral-free education loan's primary borrower is the student; a parent, spouse, or sibling can be a co-applicant.
When you apply for a collateral-free loan, the bank will usually ask for co-applicant information. Banks also require documents from co-applicants, such as salary slips or income tax returns, before approving an education loan. The RBI guidelines do not specify an upper age limit, but some banks may impose one based on their own internal rules and regulations. The loan application requires Indian citizenship, as well as admission to a certified college or university in India or abroad (including NAAC/NBA accredited institutions and programmes) and national importance and centrally funded technical institutions (CFTIs)). The lender will ask for an admission letter from the college/university and the course fee structure for which you have applied for an education loan. Lenders may also request documents such as Class X, XII, and graduation mark sheets. When your loan application is approved, lenders send funds directly to colleges.
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