HDFC Credila Education Loan Interest Rate: Major Factors, Calculation

HDFC Credila Education Loan Interest Rate

HDFC Credila is one of the most preferred financial institutions that provides education loans to study abroad. It provides a minimum INR 1 lakh education loan and doesn’t have an upper limit for the maximum amount. It is based on the requirements and the repayment capacity of the students.

HDFC Credila education loan interest rate depends on a number of factors such as the credit score of the applicant, net monthly income, loan amount, type of loan, type of interest rate etc. The interest rate is calculated based on the EBLR (external benchmark lending rate) or the CBLR (HDFC Credila’s Benchmark Lending Rate). Check all the details on HDFC Credila education loan interest rates in this blog.

What is HDFC Credila Education Loan Interest Rate?

At present, HDFC Credila education loans are provided at interest rates ranging between 14% to 16%. Its current CBLR is 13.80% and is subject to change from time to time based on the economic scenario, RBI Guidelines on education loans and HDFC Credila’s internal policy. The loan is provided at a floating rate of interest which is subject to revision every quarter. Check the major factors below:

  • The rate of interest for HDFC Credila study abroad loan will be the floating rate of interest linked to HDFC Credila’s Benchmark Lending Rate (CBLR)
  • The spread part of the interest rate will be determined based on the risk profile of the applicant
  • The risk profile includes various factors such as the student’s academic background, job prospects of the selected course from a selected college and country of study etc
  • The interest on education loan re-payment will start immediately after the first disbursement of the first instalment of the loan

Also Read: Getting a loan from HDFC Credila? Check all about the HDFC Credila Education Loan Disbursement Process

HDFC Credila Interest Rate Calculation

HDFC Credila’s interest rate calculation is calculated based on the spread and the CBLR. As stated above, the current CBLR of HDFC Credila is 13.80% and the spread will be decided based on the creditworthiness of the applicant. Major factors to be considered while determining the spread percentage are the financial status of the co-applicant, loan repayment capability, credit history and repayment behaviours, collateral offered etc. Check the calculation process below:

CBLR (HDFC Credila’s Benchmark Lending Rate) = 13.80%

Spread = 2%

Effective interest rate= (13.80 + 2)% = 15.80%

Factors Affecting Education Loan Interest Rate

There are certain factors that affect the education loan interest rate in one way or the other. Some of the major factors include Credit Score and history, type of university and course, net loan amount, repayment period etc. Let’s discuss some of the major factors of the education loan interest rate:

Credit Score of the Applicant

One of the primary factors impacting the education loan interest rate is the creditworthiness of the applicant. A higher credit score indicates a lower credit risk for the lender, and individuals with better credit scores are often offered lower interest rates. A good credit history reflects the financial responsibility and the ability to repay the loan, making the borrower less risky for the lending institution.

Also Read: Check out this blog and know all about HDFC Credila Education Loan processing time

Type of Institution and Course

The type of educational institution and the course of study can impact the interest rate on education loans. Lenders may categorise institutions and courses based on their job prospects for future employment. For example, loans for courses at reputed institutions or those leading to high-demand professions may come with lower interest rates, as there is a lower risk of repayment default.

Loan Amount and Repayment Period

The loan amount and the duration of the repayment period also play a significant role in determining the interest rate. Larger loan amounts may attract higher interest rates due to the increased risk for the lender. Also, the repayment period can affect the interest rate, with longer durations leading to higher rates. Lenders may offer more favourable terms for smaller loan amounts and shorter repayment periods.

FAQs

What is the current HDFC Credila education loan interest rate?

The interest rates may vary based on factors such as the loan amount, tenure, and the applicant’s profile. Currently, the interest rate ranges between 14% to 16%.

How is the interest rate for HDFC Credila education loans determined?

HDFC Credila determines education loan interest rates based on various factors, like the applicant’s creditworthiness, loan amount, and the chosen repayment tenure.

Can I choose between fixed and floating interest rates for HDFC Credila education loans?

HDFC Credila offers both fixed and floating interest rate options for education loans. Applicants have the flexibility to choose between the two based on their preference and financial strategy. However, it depends on the internal policy of HDFC Credila and what type of interest rate they allow.

Are there any specific eligibility criteria that can impact the interest rate on HDFC Credila education loans?

Yes, HDFC Credila considers several eligibility criteria when determining the interest rate for education loans. Factors such as academic performance, choice of course and institution, co-borrower’s financial stability, and the overall creditworthiness of the applicant play a role in determining the interest rate.

Is there an option to reduce the interest rate on HDFC Credila education loans during the repayment period?

Usually, there are no options to reduce the interest rate during the loan repayment. However, you can contact HDFC Credila and apply for an education loan restructure if you are facing financial stress.

This was all about HDFC Credila Education Loan interest rates. Always check and analyse all the factors before initiating the loan application. Also, try to choose a fixed interest rate if available. 

To know more about education loans, the best bank accounts for students, forex and banking experience for global students or international money transfers, reach out to our experts at 1800572126 to help ease your study abroad experience.

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About Shekhar Suman

Shekhar is a versatile writer with a passion for sharing knowledge and creativity. With expertise in crafting informative blogs on study abroad and finance, Shekhar helps readers navigate the complexities of education and financial planning. Most of his writings blend the practicality of finance and the beauty of language, making a meaningful impact in both spheres. Beyond his professional pursuits, he finds solace in the writing Shayari.

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