GEEBEE EDUCATION

OVERVIEW ABOUT
EDUCATION LOANS
From where do I get an education
loan?

You can get education loan from

 Banks
 NBFCs (Non Banking Financial Company) – NBFC loans
though may not be accepted directly in few countries.
How much loan can I avail for
education?
 A student can avail up to 1 crore for studying abroad which
include tuition fees, travel expenses, accommodation, insurance
and other relevant expenses.
What is the interest rate?

 Usually the interest rates are between 8.5% to 12 % p.a.

 Female applicants get 0.5% to 1.00% discount on interest rates
from most institutions

(The rates of interest are estimated as on July 2022)

Do I have to give any mortgage?

 In most cases the banks will need mortgage/security

against loan
 There are a few NBFCs and a couple of banks which
provide 20-50 lacs unsecured loans. This amount varies
from country to country, program to program and profile
to profile
Who can sponsor my loan?

 Usually, parents should be the sponsor. Relatives, colleagues

and friends can also be part of your loan application by being
guarantor.
When do I have to repay my loan?
 Repayment generally begins after 6-12 months after
completion of course or after getting job, whichever is earlier.
Repayment period for educational loan is generally 7-10 years.
When do I have to pay my interest?

 Generally the interest is paid during the studies. The moment

the money is withdrawn or utilized from loan account the
interest starts. There might be a few banks which might give an
option of paying the interest after the program completion but
terms and conditions of those banks need to be understood
thoroughly.
Can I start loan process on conditional
offer letter ?

 Yes. Most banks can initiate education loan process on

the basis of conditional offer letter. We strongly
recommend to initiate the loan process immediately
once you get a conditional/unconditional offer letter.
What is money margin?
 Margin money means students contribution towards loan
amount. Most banks normally charge 10 to 25 % margin, while
some co-operative banks don’t ask for any margin money.(e.g.
Saraswat Co-op and Abhudaya Co-op). Most NBFCs do not
have any clause of Margin Money but get this point cleared
before initiating the loan process.
E.g. of margin money.

 The margin is the amount you need to pay from your own
funds, while the rest is paid by the bank.
 If you need say a loan of Rs 10,00,000. The bank approves loan
of 10,00,000 with margin of 15%. Then the bank will disburse
8,50,000 and the you will have to arrange for 1,50,000.
 In this case 1,50,000 is the margin amount.
Do all banks give loan for
Diploma/PG Diploma programs?

 Most banks give loans for diploma and PG diploma programs

provided all other things are in place.
Is there any penalty for repaying the
loan early?
 Generally banks do not charge an early repayment penalty for
loan. But one needs to check with banks before processing the
loan.
Is it compulsory to take loan from
nationalized bank?
 It depends which country you want to study. If you are
interested in countries like UK, Ireland and Australia it is
compulsory to take loan from nationalized banks only, loans
from co-operative banks are not allowed. For countries like
USA, Canada and New Zealand, loans any bank i.e.
nationalized/co-operative banks are allowed.
My parents do not file I.T. return?
Can I still get a loan?
 No, you cannot get a loan without I.T. returns of your parents. But
if you have any close relative who is ready to become a guarantor
then you have chances of getting a loan.You should negotiate with
banks. Some banks may give personal loan which still help student.
How long does it take to process a
loan?
 Education loan processing depends upon 2 things – documents
of the applicant and bank procedures. If all the documents are
correctly filed as per requirement of the bank than the loan
takes about 30-60 days.
 Approach at least 2-4 banks for Education Loan.
Does availing Education loan gets any
tax benefits?

 For any interest paid by parents on education loan taken for

their children, they can claim deduction against total taxable
income under Sec.80E. Please consult the concerned bank official
or your personal tax consultant for more information on this.
Are there any processing fees for
education loan?

 Almost all banks will charge processing fees.

 The processing fees of most NBFCs are higher than the
normal banks but are also negotiable in many cases.
THANK YOU
GEEBEE EDUCATION Borivali