5 things to know before availing an education loan

financialexpress.com:

Education loans play a pivotal role in shaping the academic aspirations of students across India. As the cost of education continues to rise, these loans serve as a financial bridge, enabling individuals to pursue higher studies and achieve their career goals.

Education loans are offered by banks and financial institutions to support students’ educational aspiration. These loans typically cover tuition fees, accommodation expenses, study materials, and other related costs incurred during the course duration.

One of the primary advantages of education loans is their accessibility. Students from various economic backgrounds can apply for these loans to pursue education in India or abroad. The loan amount sanctioned is determined based on the course fee, institution reputation, and the applicant’s financial circumstances.

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Interest rates on education loans may vary based on the lender, the loan amount, and prevailing market conditions. Many banks offer competitive interest rates, and certain schemes provide subsidised interest rates for students.

Repayment of education loans usually begins after the completion of the course. Some lenders offer a grace period, allowing borrowers to secure employment before commencing repayments. The repayment tenure can extend for several years, providing flexibility to students in managing their finances post-education.

Adhil Shetty, CEO, Bankbazaar.com, says, “Borrowers have the option to repay their education loan over a span of up to 15 years. Additionally, students are granted a payment hiatus known as a moratorium. Typically lasting for 12 months post-course completion, this allows students the needed time to secure employment