Know the Limits for Undergraduate Student Loan
The increasing Educational expenses are making it really difficult to fulfil their child’s career needs. Keeping this in mind, Education loan has become a requirement in the lives of students. Different banks provide different loan rates depending on the amount required for the entire duration of the course. It is important to go through the criteria of undergraduate student loan limits that are associated with it:
Age factor: The applicant must be a citizen of India and his/her age must be between 18 to 35 years during applying for the loan.
Loan limit: Although there is no upper limit on the loan amount that is granted to undergraduate students, different banks have different loan limits set by their respective teams. For example, SBI provides a minimum amount of loan for 4.5 lakh while its Global Ed-Vantage scheme provides loan up to 1.5 crores for foreign education.
The requirement of a co-signer: A co-signer is a mandatory requirement for students who want to obtain a loan for Educational purposes. The co-signer acts as a guarantor to the bank for the repayment of the loan.
Security collateral- For loan amount below 7.5 lakhs, banks don’t demand any security deposit while for loans above the mentioned amount, providing security collateral is mandatory.
Indian banks are divided into public, private sectors and NBFCs. While NBFCs provide a higher loan amount to borrowers without the requirement of collateral or third party guarantor; Public Sector banks provide concession on the rate of interest to the borrowers. Thus, it is important to gather knowledge about the loan schemes from different banks to select the best loan plan for you.
Repayment plans vary from one loan scheme to another. Paying back your loan on time can result in a good credit score (CIBIL) which can be useful in easy sanction of loans in the future.
