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Questions (FAQs) on
What is an Education Loan ?
Like all other loans, education loan is also a borrowing or credit taken from a bank or financial institution but the purpose of the loan here is very specific – Education. Whether you are going to study in India or abroad, you can get your course fee, books costs, expenses of living etc financed. For those who can’t afford the expenses initially, they can still fulfill their dreams of quality education and later payback the loan from their own earnings..
What is the process to apply for an education loan?
Almost all of the leading private banks & government banks offer education loan. Their offerings and process may vary. But in general, you need to submit an application form for education loan and the application needs to carry your identity proof, residence proof, aadhar card, photograph, marksheets & certificates, the letter of admission where you are going to study and foreign travel tickets (in case of overseas education loan). At times the bank may also ask your parent to be a co-applicant and in that case you would be required to submit their ID, address, PAN card, ITR for last 2-3 years as well.
Which banks offer best education loan in India ?
Almost all leading banks offer education loans in India. You must compare their nitty-gritties, terms & conditions , interest rates, processing fee etc very carefully. Many banks have the feature of repayment holiday in education loan products, which gives you some breathing time to meet the liabilities of repayment.
Some of the most popular education loan schemes which you may consider are :
SBI Student Loan Scheme | Axis Bank Education Loan | HDFC Bank Education Loan | PNB Saraswati Scheme | PNB Udaan Scheme | Canara Bank Education loan | Bank of Baroda Scholar Scheme | IDBI Education Loan | Indian Overseas Bank Vidya Jyoti Scheme | Allahabad Bank education loan.
An expert education loan advisor may give you more detailed information on prevailing terms & conditions, rates and benefits available under various schemes.
Are there any tax benefits of education loans as well ?
Yes. Education loans do bring you tax benefits. For an education loan taken for higher education purposes and from a bank or govt approved financial institution, when you repay the loans, the interest component of your student loan EMI (equated monthly installment) is taken as a tax waiver deduction under the section 80E of Income Tax Act, 1961. This tax waiver is applicable only for the 7 years from the start of repayment.
To know more on benefits of student loan and the tax implications related to it, you must contact an education loan advisor or any financial advisor who offers services in education loan as well.