State Bank of India - Education Loan
The ever-increasing cost of education is worrying parents who want their children to pursue higher education. Financing the high-priced education is a matter of concern for all such parents. These days, graduation courses like BBM, BHM, BSC, B.Com etc., cost between Rs 50, 000 to Rs 100000 per year. An engineering degree costs between Rs 75, 000 to Rs 2 lakhs per year. And a MBA course will cost you anywhere between Rs 2 lakhs to Rs 10 lakhs per year. While for a five-year medical course at a private college, this could go up to Rs 50 lakh
The rising cost of higher education has become prohibitive and many are not able to afford it. And that is where education loans can help students and their parents. Education loans have made life easier; it is one of the popular means to fulfil academic dreams these days. These loans cover most expenses one can have as a student, like tuition fee, hostel fee, refundable deposits, laptops, etc.
Availing education loans in India is not difficult if you know how to choose bank and the educational loan as majority of the banks in India are providing easy educational loans to the Indian students. But if you don’t have much idea on how to select perfect education loan you may feel it as herculean task.
Comparing the education loans from different banks, I preferred to take education loan for my nephew for the engineering course from State Bank of India. It has been a good experience with banking with SBI for Education loan as the concerned officials were cooperative in terms of documentation and other related issues.
Let me share few important details about the SBI Education loan which may be useful for parents and students to apply.
Eligibility and Courses
For the Indian students for pursuing higher education in India or abroad where admission has been secured. Graduation courses/ Post graduation courses/ Professional courses, other courses approved by UGC/Government/AICTE etc,
For studies in India - maximum Rs. 10 lacs and for studies Abroad - maximum Rs. 20 lacs.
For loans up to Rs.4 lacs - No Margin. For loans above Rs. 4 lacs, Studies in India - 5% and Studies abroad - 15%.
Regarding Security, upto Rs. 4 lacs - No Security and above Rs. 4 lacs to Rs. 7.50 lacs - Collateral security in the form of suitable third party guarantee.
Rate of Interest
Upto Rs.4 lacs - 11.25% p.a, above Rs. 4 lacs and upto Rs.7.50 lacs - 12.75% and above Rs.7.50 lacs - 11.75% p.a
Coverage of Expenses Towards
Fees payable to the college for Examination, Library, Laboratory fees, Books, Instruments, Uniforms, Caution Deposit, Building Fund, Refundable Travel Expenses, Passage money for studies abroad.
Also the fees are covered for the purchase of computers considered necessary for completion of course and any other expenses required to complete the course like study tours, project work etc.
Processing Fees & Repayment
No processing fee/ upfront charges. Deposit of Rs. 5000/- for education loan for studies abroad which will be adjusted in the margin money
Repayment will commence one year after completion of course or 6 months after securing a job, whichever is earlier.
Few Important Tips to know before applying Education Loan.
There are certain important things one should know before applying education loans. One should compare across various options before finalising on the most appropriate option. Here are a few things that you must look for in an education loan.
Eligibility for loan
Documents required for availing educational loan
Check out Processing fees, tenure of the loan and moratorium
Interest rates of educational loans
Pre-payment options of an educational loan
It is always better to remember these points before & while applying for education loans, as these will help to choose education loan from the best available options in the market.
Conclusion
Analyse all the details in advance and then one can be free to choose the best education loan. The first and most important thing that one should look at is interest rates. The PSU banks may score on this count, though one may have to do some running around to get loan approved. But, in the end it’s worth a while.