6 Features to look for in education loans

Education Loans help students learn their chosen courses at a good university and thereby, build fabulous careers in the future. But this dream is often cut short if they do not get the right education loan on time.

In this article, we will tell you the features to look for a right education loan for yourself.

1) Low Interest Rate

The interest rate levied on an education loan changes from lender to lender. The difference in the interest rate by as little as 0.5% than that of other lenders will play a huge role in saving you a fortune by the time you pay the last EMI of your education loan. So, look for a lender that levies a lower interest rate on your education loan than others.

2) All Expenses Covered

Most banks offer education loans that cover partial expenses only. The student has to bear the rest of the expenses. It is called margin money. Many students can’t finance their education this way. Therefore, lenders like NBFCs offer to cover all the expenses related to the student’s education. They cover the college tuition fees, the travel expenses, the lodging and boarding expenses, the exam fee, the library fee, the stationery expenses and so on. Choose a lender that covers all of your education costs.

3) Generous Moratorium Period

The lenders do not expect students to start repaying education loans as soon as he or she completes his or her higher studies. They offer a grace period called the moratorium period. Usually, it lasts until 1 year from the time the student completes his or her education or until 6 months from the time the student gets his or her first job, whichever comes earlier. Different lenders might offer different moratorium periods on a case to case basis. Choose a lender that offers a moratorium period that is most suitable to you.

4) Suitable Tenure of Repayment

After the moratorium period ends, the loan repayment tenure begins. The lenders draft the tenure after consulting with the student, and they do so in a way that he or she does not find it too difficult to repay the loan. But remember, the more the repayment tenure, the more you pay overtime. Ask your lender to give you the tenure that is just right for you.

5) Appropriate EMI Value

An EMI is a small sum of money the student has to pay every month to gradually repay his or her education loan. The lender discusses the value of the EMI with the student before the repayment tenure begins. The higher the EMI value, the faster the loan will be repaid and lesser the student will pay overtime. Ask the lender to set the EMI value that is comfortable for you.

6) Customer-Friendly Services

Some lenders make the process of getting an education loan easy for the students. They offer customer-friendly services like 24-hour hotline contact numbers, doorstep loan application service, friendly and well-mannered staff, and so on. Most NBFCs provide services like these. Ask your lender if they provide these services.

So, these are the 6 features you should look for in your ideal education loans. After reading this article, you are in a better position to bag a feasible education loan for yourself. All the best!