Loans to pay students can be taken from any public or private bank. In other words, it can be called loan consolidation also as you are closing existing debts with a fresh loan. Suppose you are working or have additional funds. In that case, you can pay your education loan without any extra charges as most banks do not take any early repayment charges for education loans. If you want loans to pay student loans you can apply for a personal loan from any bank or financial institution.
Table of contents
What are Loans to Pay Student Loans?
Loans to pay off student loans allow borrowers to combine existing education loans into a single new loan with lower interest rates or better repayment terms. This is also called student loan refinancing or consolidation loans. Student loan consolidation can help reduce monthly payments or extend the repayment period. It’s a popular option for students looking to manage multiple loans or improve cash flow after completing the course.
Also Read: Check here all major details on SBI Education Loan Top Up
Best Banks for Loans to Pay Student Loans
There are a lot of banks in India that provide loans for debt consolidation. The bank will provide a personal loan, whether it is an education loan, credit card bills or any other type of loan debt. Check some of the best student loan consolidation banks and their features for loans to pay student loans below:
| Particulars | Details |
| State Bank of India (SBI) | Pre-approved personal loan of up to INR 35 lakh Salaried or self-employed individuals can apply Interest rate starts from 11.45% |
| ICICI Bank | Personal loan of up to INR 50 lakh Zero foreclosure charges after payment of 12 EMIs Interest rate starting from 12.85% |
| HDFC Bank | Personal loans up to INR 40 lakh with instant disbursal Interest rate ranges from 10.85% to 24.00% No documents are required for pre-approved personal Loan |
| Canara Bank | Loans up to INR 20 lakh with zero processing charges No foreclosure charges Interest rates range between 9% to 14% |
| Axis Bank | Pre-approved personal loans of up to INR 40 lakhRepayment period of up to 84 months Interest rate starting from 11.25% |
Eligibility Criteria
The eligibility criteria for a personal loan for debt consolidation depends upon two major things: (a) the income of the applicant and (b) Credit score. Apart from these two factors, the bank considers the debt-to-income ratio, repayment behaviour, financial stability etc. Check some of the essential eligibility criteria for loans to pay student loans below:
- A strong credit score is essential, as lenders use it to assess creditworthiness.
- A stable income source or proof of future earning potential is often required to show repayment ability.
- The applicants must have a low debt-to-income ratio, usually 10-20% of the net monthly income.
- Some lenders only offer refinancing for graduates of certain degree programs or accredited institutions.
Also Read: Check here all about How to Secure Education Loan at low interest rates
Documents Required
The bank verifies the documents before sanctioning the loan. You need to submit financial, academic and KYC documents to the bank. For a personal loan for debt consolidation, the bank analyses documents and determines the loan amount based on the same. Check below the list of documents below:
- Aadhaar card or PAN card
- Last 6 months’ bank statements
- Last 3 months’ salary slips
- Passport-sized photo
- Employment details
Loans to pay student loans can be helpful as they can reduce the overall cost of existing loans and it will also provide financial relief. Compare the loan offers from different banks before applying. Check some FAQs based on loans to pay student loans below:
FAQs
Loans to pay student loans are used to combine multiple existing student loans into one. This type of loan offers lower interest rates or extended repayment terms.
Several Indian banks offer personal loans for debt consolidation. Some of the best banks are SBI, ICICI Bank, HDFC Bank, Canara Bank, and Axis Bank. These banks provide flexible options with loan amounts ranging from INR 20 lakh to INR 50 lakh.
Eligibility for loans to pay student loans depends on the applicant’s credit score, income stability, and debt-to-income ratio.
Some major documents that you need to submit are KYC documents like Aadhaar or PAN cards, recent bank statements, three months of salary slips, passport-sized photographs, and employment details.
Most banks do not charge fees for early repayment on education loan refinancing or personal loans for debt consolidation.
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.
Follow Us on Social Media
