Personal Loan for Education: Features, Benefits, Eligibility and Application Procedure
One of the ways to steer your career in the right direction is to get quality education from a reputed institute. However, the cost of higher education in India and abroad is skyrocketing each year. Many people can’t afford to pay such high tuition fees and therefore they opt for education loans.
Additional expenses such as tuition fees, hostel fees, lodging costs and day-to-day expenses are sometimes left out of some regular education loans. However, a personal loan for education can be used without any restrictions and for 100% of students’ expenses.
Let us look at the details of these loans.
Navi offers personal loans of up to Rs. 20 lakh, which you can use to pay all education-related expenses. The approval process is completely hassle-free and almost instantaneous. You can download the Navi app to avail a personal loan through a completely paperless procedure.
To apply for this loan, follow the given steps:
- Open the Navi app and opt for a personal loan.
- Select the loan and EMI amount.
- Fill in the details of your PAN and Aadhaar to complete KYC.
- After a quick approval, your money will be credited to your bank account.
Why Would I Want to Apply for a Personal Loan for Education?
A personal loan is a useful credit facility that does not require you to pledge any collateral. It comes with no end-use restrictions, so you use it for any purpose. This is quite useful for higher education as it funds all additional expenses, including travel, lodging, cost of special coaching, purchase of study material, etc.
Unlike a regular student loan, you can get a personal loan for your own or your family member’s education. It is also easier to avail a personal loan than an educational loan as the former does not have stringent eligibility criteria.
It is quick and hassle-free to get approval for a personal loan for education, and you can get 100% of your education-related expenses funded. The entire process is entirely paperless, and you can get this loan almost instantly approved online.
Features and Benefits of Personal Loan for Education
A high-value loan
With Navi, you can get a cash loan of up to Rs. 20 lakh almost instantly through a paperless approval process.
Affordable personal finance
An instant personal loan for education is available at affordable interest rates, making repayment much easier.
Flexible EMIs
You have the flexibility to choose the EMI amount at your convenience.
Instant approval process
The approval process is completely paperless. You can download the application from Google Play or App Store and get instant approval.
For emergency funds
Due to no end-use restrictions and almost instant approval, you can opt for this loan during an emergency. You can also create an emergency fund with it for your son/daughter to meet unforeseen expenses while studying abroad.
No need for collateral
Unlike secured loans, you do not have to pledge any asset to get a student loan without end-use restrictions.
Minimal documentation
You do not need to submit many documents to avail this loan. Just proof of your identity, address and income will get you quick access to funds.
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Eligibility Criteria for Personal Loans for Education
The following are the common eligibility criteria for this type of financial assistance:
Applicant’s age
18 to 65 years
Residential status
Residing citizen of India
Employment type
Salaried or self-employed professional
Business/work experience
At least 3 years
CIBIL score
750 or above
Note that the eligibility criteria for a personal loan for education may vary from one lender to another. For example, a financial institution might require borrowers to have a minimum monthly income. Moreover, the minimum age limit for applying for a personal loan for education can be different.
Documents Required for a Personal Loan for Education
Most financial institutions will require you to submit the following documents for a personal loan:
- Passport-sized photograph
- KYC documents (Aadhaar card, PAN card, voter ID card, passport, driving licence, etc.)
- Date of birth proof
- Proof of income (salary slips, bank account statements)
- Proof of business existence (for business owners)
Individuals need to submit self-attested copies of documents along with the duly filled application form. The financial institution may ask for additional documents if required.
Factors that Affect Personal Loan for Education Eligibility
- The higher your monthly income, the more loan amount you will be eligible for.
- Your credit score reflects your creditworthiness and how much risk you represent for borrowing.
- In case you have any existing debt, your chances of getting a new loan will be lower.
- Working for a reputable company also increases your eligibility for a student loan.
- You will have better chances of approval if you own a permanent residence instead of living in a rented property.
Final Word
A personal loan for education is a great alternative to student loans as it comes with no end-use restrictions. Moreover, there are other advantages such as no requirement for guarantors and less stringent eligibility criteria.
Navi offers instant personal loans up to Rs. 20 lakh in a 100% paperless manner. Download the Navi app, apply and get the mount disbursed to your account within minutes.
Frequently Asked Questions
Why is it difficult for students to apply for education loans?
Many education loans come with strict eligibility criteria, which prevent many from getting access to funds. Whether or not a student is eligible for an education loan depends on his/her academic records, the reputation of the educational institution and courses applied for.
What is the moratorium period for student loans?
The moratorium period of an education loan refers to a duration of 6 months to 1 year after the student has completed his/her course. During this period, the applicant does not have to start repayment of the loan and can spend the time looking for a job.
How can someone with a low credit score apply for a personal loan for education?
Take the following steps to get a personal loan if you have a low credit score:
- Provide evidence of your income capacity.
- Apply for the loan with a co-applicant.
- Select a lower loan amount.
- Try to improve your credit score.
What are the eligibility criteria for education loans?
Most financial institutions offering education loans will require the applicant to be an Indian citizen. Moreover, he/she has to secure admission into a recognised college/university. Some lenders may require students to be of a certain age to apply for an education loan.
Are there any tax benefits for education loans?
Yes, Section 80E of the Income Tax Act allows a tax deduction on the interest paid for student loans. You can claim this deduction for interest paid for 8 assessment years. Individuals can claim this for paying interest for themselves, their spouse or children.
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