In India, the number of students who want to study abroad is increasing rapidly. As per reports, more than 1 lakh students choose international destinations for their higher study. Not only the more universities accepting international students, but also financing abroad education has become relatively easier. But you don’t need to be scared. In this blog, we will discuss how you can choose the perfect student loans for studying abroad.
However, keep in mind that financing international education is not an easy process and it won’t happen overnight. When you’re applying to an international college, you won’t receive a visa until you prove that you have the proper financial means to study abroad.
Tips to Choose Right Education Loan for Study Abroad
While choosing an education loan for studying abroad, you need to take a couple of measurements into consideration so that you don’t face issues later. If you manage to follow these tips, you will receive the perfect student loans for studying abroad.
Choose a Course with Great Job Security
This is one of the most important things you need to know. Before you apply for student loans for studying abroad, make sure you conduct thorough research about the university and courses to determine if you can get lucrative job opportunities. You don’t want to end up in a situation where you face problems generating ROI after completing your course.
Make sure you choose a course that is capable of providing you with a great return on investment. This way you can pay back your education loan without facing financial problems.
Determine the Loan Amount
You need to decide on the loan amount before you apply for an education loan to study abroad. Create a detailed plan and include all your expenses as well as the coverages. If you think you can manage half expenses from your own savings, you can apply for the other half. As a result, you will face less financial burden in the future.
Longer Repayment Tenure Will Prove Most Effective
This is one of the smartest decisions you can make while choosing student loans for studying abroad. Don’t forget to go through the loan repayment tenure. If you take an education loan with longer repayment tenure, your monthly EMI instalments will be lower. But longer repayment tenure means more interest rates.
This means that you can pay your education loan as well as manage your monthly expenses without any problem. But if you think you can repay the loan amount faster, choose a shorter period as this will help you save money.
Must Read: Student Loan- Refinance/Consolidation
Types of Education Loans
If you’re someone who doesn’t have much knowledge about student loans for studying abroad, here are the two types of education loans you can look for:
Secured Loans
If you choose this loan for the study abroad process, the borrower needs to submit some of their assets to the bank as collateral. If you want to take a secured loan, you need to mortgage your property. However, keep in mind that you cannot use your agricultural land as collateral.
Unsecured Loans
This is another type of education loan that won’t be secured by the assets of the borrower. The unsecured loans might be provided by financial institutions under various marketing packages and guises. You also need to fulfil numerous conditions to receive an unsecured loan.
Must Read: Secured Vs Unsecured Education Loans: Which One To Choose And Why?
Eligibility Criteria
Now that you know the availability of different types of student loans for studying abroad, you need to know the documents and the eligibility criteria to apply for the loan. Let’s discuss this point in depth.
Borrower’s Profile
Your GRE score will play an essential role in receiving an education loan for studying abroad. Apart from the GRE score, your academic performance, as well as your work experience, will determine the success of receiving the education loan. Proof of Indian citizenship is also essential otherwise your application will be rejected.
Co-Borrower’s Profile
The role of a co-applicant will also play a huge role in getting an education loan. The location, financial background, and assets owned by the co-borrower will play important factors to secure an education loan.
Underwriting Norms
This is one type of guideline that will be issued by the bank to make sure that the loans are issued securely and safely. This guideline will also be issued to determine if the education loan for the student should be applied for or not, how much the loan amount should be, and whether the candidate will be capable of repaying the loan.
Recognised University
The university that you’re targeting will also matter in terms of your student loans for studying abroad. The bank will consider the rank of the university. If you’re selected by a higher-ranking university, you will have more chances of securing an education loan. This is because high-ranking universities offer high-paying jobs which will boost the security of the loan.
Must Read: What are the Student Loan Eligibility Criteria for Studying Abroad?
Required Documents
While applying for student loans for studying abroad, you need to submit multiple documents to back up your claim, Here’s the list of the documents required for an education loan:
- KYC documents
- Birth certificate
- Application form
- Residence proof
- Academic transcripts
- Offer letter from the university
- Income proof
- Passport photographs
Application Process
This is another essential step you should keep in mind. Make sure you follow these steps while applying for student loans for studying abroad.
- Choose a suitable loan that would help you cover most of your expenses.
- Go through all the necessary information such as interest rates, repayment tenure, etc.
- Go through the official website.
- Complete the application form.
- Upload the relevant documents.
Must Read: How to Pay Off Student Loans?
FAQs
Ans. Even if the process might look complicated, it’s not difficult. You need to ensure you’re completing the application process and submitting relevant documents.
Ans. The amount of interest will be dependent on the amount of the loan as well as the repayment tenure. The principal amount and interest need to be paid monthly.
Ans. Depending on the loan amount, it might take a couple of years to completely repay the loan.
To know more about education loans to study abroad, international money transfers or student bank accounts, reach out to Fly Finance.
