Educational Bank Loans for Students

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Education Loan for People with Disabilities

The National Handicapped Finance and Development Corporation will extend a loan of [rupee]10 lakh for people with disabilities who pursue higher education and [rupee]20 lakh as loan for those who pursue higher education abroad.

A rebate of 0.5 per cent would be offered for women candidates.

For details, the district office of Department of Social Welfare can be contacted.

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Education Loan Mela

The district administration is organising education loan mela here on September 20, 2011. This is the second such mela this 2011.

Commercial Taxes Minister Agri S.S.Krishnamurthi would be handing over the sanctioned education loans to the students at the event. The beneficiaries include those who submitted their applications seeking education loan during the first education loan mela conducted by the district administration on July 19, 2011.

District Collector Anshul Mishra, Thiruvannamalai, in a statement on September 19, 2011, said that students who want to apply for education loan afresh at the camp should bring with them 10th, Plus Two mark sheets, bonafide certificate, fee structure of the college, counselling certificate and College Allotment Letter. The camp begins at Collectorate meeting hall by 9 am.

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State Aid for Over 1,000 Sri Lankan Tamil Students

The government will provide financial assistance to over 1,000 Sri Lankan Tamil students pursuing higher education in various colleges in the State.

Finance Minister O. Panneerselvam told the Assembly on September 14, 2011 that the government was providing free school education to Sri Lankan students living in refugee camps. As it was necessary to fund their higher education, it would introduce a finance assistance scheme from this year.

About 21,500 Sri Lankan students in 112 refugee camps were finding it difficult to travel to educational institutions as the camps were far away.

Therefore, the government had decided to give five seats each in 1,254 hostels run by the Adi Dravidar Welfare Department ( excluding hostels for tribals ) and 1,238 hostels administered by the Backward Class Department.

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Applications for Education Loans

Applications for education loan would be received at the Collector Office here on September 17, 2011 and those who wish to avail the loans can utilise the opportunity, said Collector Darez Ahmed.

Educational loans to the tune of [rupee]15.69 crore have been sanctioned to 1,207 students of the district during the special camps held in the district during August this year. Banks were currently engaged in disbursing the loans.

However, there were complaints from some students that they have not been able to get loans so far.

Submission

Students who wish to get the loans, can submit their applications at the special counters at the Collector’s Office on September 17, 2011. Mr.Ahmed said in a press release.

Applications should be accompanied by two passport size photographs of the parents / guardians of the candidates, copies of ration, educational certificates ( mark sheets of SSLC and Plus Two ), salary certificates and income certificate of parents and allocation orders for engineering / medical seats. Applications for the loans can be downloaded from the Website : www.perambalur.nic.in or www.perambalur.tn.nic.in

Complaints

Students who were issued sanction orders for the loans during the special camps held on August 9 and 20, but were yet to get the loan amount can lodge their complaints over the telephone by dialling 9445043119 or appear in person at the Collector’s Office on September 17,

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Bank Loans come to Students Rescue

Higher Education was not in the reach of the common man for two factors – availability and affordability. As availability issue is being sorted through various means, affordability is still an issue for the middle and lower classes.

But the Education Loan scheme devised by the Central Government in 2001 to a certain extent has solved this issue. Now student can aim high and get into the best of institutes in India and abroad with the bank loans available for higher education.

Eligibility

Student should be an Indian National and secured admission in professional or technical courses in India or abroad through entrance test or some merit – based selection process.

Courses

Loans are offered for diploma, graduate, post – graduate and Ph.D courses in the faculties of engineering, technology, architecture, medicine, dental science, agricultural science, veterinary science and computer certificate courses of reputed institutes accredited to department of electronics or affiliated to university.

Students pursuing courses like ICWA, CA, CFA and courses conducted by IIM, IIT, IISc, XLRI, NIFT are also eligible apart from courses offered in India by reputed foreign universities. Banks may have the system of appraising other institution courses depending on future prospects and recognition by user institutions.

Expenses considered for loan include fee payable to college, hostel, examination, library and laboratory fee apart from purchase of books, equipments, instruments and uniforms.

Travel expenses for studies abroad and purchase of computers, insurance premium for student borrower and expenses for study tours, project work and thesis are also covered.

However, students should understand that getting a loan is not as easy.

The rate of interest is another factor to be kept in mind while applying for education loans. Banks offer loans at varied rates of interest and students need to do extensive research to ensure that they get the best deal. Since the banks don’t give the entire education loan component, students still have to mobilise money if they want to get admitted to professional courses.

Nationalised banks offer a maximum loan of 20 lakh for studies abroad and 10 lakh for studies in India. Loans up to 4 lakh require no margin while loans above 4 lakh for studies in India require five per cent margin and 15 per cent for studies abroad.

Loans up to 4 lakh need co – obligation from parents and no security while loans above 4 lakh require co – obligation of parents together with collateral security in the form of third party guarantee.

Internet rates for Bank Loan

Interest rates on the loans are on floating basis with respect to the bank’s benchmark prime lending rate. Generally all banks offer interest rates between 12 per cent and 14 per cent depending on the amount of loan taken. The SBM rates vary from 12.50 per cent for Rs. 4 lakh loan to 14 per cent up to 7 lakh loan.

The advantage of floating rate over fixed interest rate is that if the market rates decline, your interest outgo will also be lower. But your interest rates can climb if market rates go up. Simple interest will be charged during the repayment holiday or moratorium period.

Other charges

Though banks should not charge processing fee for education loans a few banks charge a processing fee on loans above 4 lakh for overseas studies.

The student needs to start repaying the loan amount one year after course in completed, or six months after finding a job, whichever is earlier. Loans of less than 7.5 lakh have to be paid back within five – seven years. Those exceeding that amount have to be repaid in five – seven years, with some banks extending the period up to 10 years.

Special concession in interest rate is given for girl students and one per cent in interest rate for full tenure of the loan if full interest is serviced during the moratorium period.

Banks can also issue the capability certificate for students going abroad for higher studies.

Some of the foreign universities require the students to submit a certificate from their bankers about the sponsors’ solvency and financial capability.

There is no specific restriction with regard to the age of the student to be eligible for education loan. Banks may consider top up loans to students pursuing further studies within the overall eligibility limit.

Eligibility for Bank Loan :

  • The candidate should be an Indian national
  • Should be opting for graduation courses / post – graduation courses / professional courses / other
  • courses approved by UGC / Government / AICTE
  • Loans are subject to the merit of the student

Documents Needed for Bank Loan :

  • Mark sheets of last qualifying examination
  • Proof of admission of scholarship, studentship
  • Schedule of expenses for the course
  • Photographs
  • Borrower’s bank account statement for the last six months. Some banks
  • ask statement for the last two years
  • Income tax assessment order of last two years
  • Brief statement of assets and liabilities of the co – borrower
  • Proof of income ( i.e. salary slips / Form 16 etc )
  • Any other document necessary to avail loan

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