Education plays a pivotal role in the success of a person. Individuals who opt for graduation and higher education may often find it difficult to self-finance their studies. It is in this situation that an education loan comes handy.
Education loan is a kind of loan which is given by banks to students who apply for it after taking their credibility and merit into consideration. An education loan is given to parents, students or the spouse of the student for higher education. Higher education here maybe defined as education one seeks after higher secondary level.
An education loan usually covers the tuition fees, examination fees, laboratory charges, hostel security, caution money, travel expenses and approximately 90% of the total expenses which need to be incurred by students for the completion of a course.
Education loans have certain benefits. They are as follows:
• Under section 80 E of the Tax Act one can file for an income tax deduction in case they have taken an education loan. (the deduction will be on the interest rate and not the principal amount)
• Approval of a student loan or education loan means that though a person may not have the required cash to complete his/her higher education, he/she may be able to complete the course. This is because the course fee is paid by the bank and the borrower who is a student will start the repayment of his/her education loan only after completing the course and obtaining employment.
• Another important benefit of a student loan is that the student does not have to depend on his/her guardian for the course fee and this does not become a financial burden on them.
• Approval of a student loan to a certain extent depends on the merit and capacity of the student himself. This means that if the borrower is academically meritorious it will be helpful in getting the loan sanctioned.
• If you are a female student then banks offer an education loan at a relatively lower rate. The interest rate is usually 0.5% lower for a female student than her male counterparts.
• Another major advantage of student loans offered by several banks is that there is a holiday period of anywhere between 6-12 months after the completion of the degree before the actual loan repayment begins. Though, if the borrower is able to get a job early he/she may start the monthly EMIs earlier.
Education loan is a blessing for those individuals who aim to pursue higher education but who do not have the financial means to fund it.
Education loan is a kind of loan which is given by banks to students who apply for it after taking their credibility and merit into consideration. An education loan is given to parents, students or the spouse of the student for higher education. Higher education here maybe defined as education one seeks after higher secondary level.
An education loan usually covers the tuition fees, examination fees, laboratory charges, hostel security, caution money, travel expenses and approximately 90% of the total expenses which need to be incurred by students for the completion of a course.
Education loans have certain benefits. They are as follows:
• Under section 80 E of the Tax Act one can file for an income tax deduction in case they have taken an education loan. (the deduction will be on the interest rate and not the principal amount)
• Approval of a student loan or education loan means that though a person may not have the required cash to complete his/her higher education, he/she may be able to complete the course. This is because the course fee is paid by the bank and the borrower who is a student will start the repayment of his/her education loan only after completing the course and obtaining employment.
• Another important benefit of a student loan is that the student does not have to depend on his/her guardian for the course fee and this does not become a financial burden on them.
• Approval of a student loan to a certain extent depends on the merit and capacity of the student himself. This means that if the borrower is academically meritorious it will be helpful in getting the loan sanctioned.
• If you are a female student then banks offer an education loan at a relatively lower rate. The interest rate is usually 0.5% lower for a female student than her male counterparts.
• Another major advantage of student loans offered by several banks is that there is a holiday period of anywhere between 6-12 months after the completion of the degree before the actual loan repayment begins. Though, if the borrower is able to get a job early he/she may start the monthly EMIs earlier.
Education loan is a blessing for those individuals who aim to pursue higher education but who do not have the financial means to fund it.
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