Education loans are basically a form of monetary assistance availed by students to meet the expenses associated with their studies. Education loans can be taken by means of funding, scholarships, financing and rewards, and are granted in cash, which has to be repaid to the lender along with a rate of interest. Students who wish to avail education loans are advised to borrow based on their needs as the repayment periods for these loans can vary to a great extent depending upon the lender and the amount borrowed by the student.
Most of the student loans available to individuals in India are granted at a relatively low rate of interest, and interest payments need not be made immediately. Students are usually granted a period of time before from the time they take the loan to the time they start making repayments.
Education loans are unsecured loans that can be used to cover expenses related to education, such as tuition fees, books, living expenses and other such expenses as transportation costs, etc. If you wish to avail an education loan but are unemployed or still studying, a co-signer may be required to avail an education loan, like an eligible adult such as a friend, parent or relative. The repayment of the loan can be done once the student has completed his/her education. Given the flexible terms and conditions associated with the repayment of an education loan, availing one is fairly simple and straightforward.
Different Types of Education Loan
There are a number of different education loans which are offered for different types of education programmes. Based on the type of the education that one wants to pursue, there are student loans for diploma and certificate courses, student loans for skill-based courses, student loans for studying abroad, and so on.
Whatever the course may be, there are two wide categories of the education loans on the basis of location.
1) Domestic Education Loan – For educational courses within the geographical limits of the country.
2) Study Abroad Education Loan - For educational courses outside the geographical boundaries of the country.
In addition to these, the education loans can be further divided on the basis of a few other categories. These include the following:
On the basis of course of education:
- Higher Education Loan
- Diploma Studies Loan
- Loans for Professional Courses
On the basis of security of collaterals and/or guarantee:
- Secured Loans
- Unsecured Loans
What is a Study Abroad Education Loan?
As the name suggests, a study abroad education loan is a loan which can be availed for pursuing a course of education abroad. On the basis of the type of course, there are multiple options which are available under the study abroad education loans.
Following are the Education Loans in India
- Undergraduate Education Loan
- Professional / Graduate Education Loan
- Career Education Loan
- Loans for Parents
Undergraduate Student Loans
Undergraduate student loans can be availed by individuals who have completed secondary education and wish to undertake a three or four year course to enhance their job opportunities.
Professional / Graduate Student Loans
Professional / graduate student loans can be availed by students who wish to pursue advanced degrees or higher education at colleges across the country. An undergraduate course must be completed in order for the student to apply for a graduate student loan.
Career Education Loan
Career education loans can be availed by students who wish to attend undergraduate career oriented programs at trading and technical schools and colleges across the country.
Loans for Parents
Parents of students can avail these loans, which are unsecured, to meet expenses related to their child’s education, such as tuition fees, living expenses, books, uniforms, and other expenses such as transportation costs. The loan can be availed by not only parents, but also other adult relatives who wish to enrol their children in secondary schools, military elementary schools, religious, private or non-public schools across the country.