Looking at 3 lesser-known facts about education loans

Today, most students dream of pursuing higher education from renowned universities both in India and overseas. Although, studying further at the best universities offer a promising future to students, paying the college fees is one of the main concerns of students. With education costs rising every year, one solution seems to be the most convenient to students; that is availing of an education loan.

An education loan is an option that helps students fund their university fees and other expenses incurred throughout their course period. In addition to this, most students are unaware of some of the great benefits that student loans have to offer.

Here are 3 lesser-known facts about education loans that are truly amazing.

1) Education loans cover almost every expense:

Many students are generally under the impression that student loans only help them pay off their university tuition fees. However, the truth is that education loans cover a lot more than just tuition fees. Students can request their respective lenders to provide funds for accommodation, travel, food, study materials, field trips, laboratory equipment, project, thesis, and much more. Moreover, some banks and financial institutions also offer funds for booking flight tickets and Visa procedures for travelling to the required country for studies.

2) Students can avail of a loan without a collateral:

There are two types of loans that students can avail for funding their education. These are secured loans and unsecured loans. In secured loans, people are required to pledge collateral in exchange for a loan. And in unsecured loans, borrowers can avail of a loan without providing collateral to their lenders. Many students have a misconception that to avail of an education loan, they have to pledge collateral to their lender, whether a property or family assets. However, the truth is that many financial institutions and banks offer unsecured loans where the student is not required to provide collateral to get a loan. All they require is a guarantor who signs alongside the borrower giving assurance of repayment to the lender. The guarantor can be the student’s spouse, parent, or guardian.

3) Education loans can get cheaper if you start working overseas:

Generally, students who avail of education loans tend to work abroad for a few years. If you have got a job abroad, there are good chances that you will be paid in foreign currency. In case the value of the currency in the country you are in is greater than that of India, the depreciating value of the rupee will work to your advantage. For instance, you have pursued a degree in the United States of America and are earning in dollars. If you borrowed at the rate of Rs. 70 = 1$ before your course period and after your course period, 1$ is at the rate of Rs. 75, that means by paying the same amount, you will be repaying Rs. 5 extra on your education loan.

Hope this article has been useful to you. All the best!