Securing an education abroad is a dream for many students, yet the financial burden can be overwhelming. Overseas education loans provide a viable solution for funding higher education abroad. They help students pay for their higher education in foreign universities and fill the difference between the cost of studying abroad and the student’s financial resources.
In this way, these loans make overseas education possible for more people by giving them access to funds that assist in covering their expenses. As the world is becoming more and more globalized, understanding the different aspects of these loans becomes crucial for students who are planning to study abroad.
In this article, we’ll go through the key elements of the overseas education loan process. This includes the various types of loans available, the financial lenders that offer them, and the range of expenses they cover.
Types of Overseas Education Loans
When it comes to overseas education loans, students have two primary options, secured and unsecured loans. Let’s understand their difference ahead:
- Secured Overseas Education Loans: This type of education loan generally requires collateral, such as property or a fixed deposit, which serves as a guarantee to the lender. Secured overseas education loan generally offers lower interest rates and higher loan amounts due to the reduced risk for the lender.
- Unsecured Overseas Education Loans: This type of education loan does not require collateral, making it more accessible to students who may not have valuable assets. However, unsecured loans typically have higher interest rates and more stringent eligibility requirements.
The choice between secured and unsecured overseas educationloans largely depends on the student’s financial situation, availability of collateral security, and risk tolerance. Moving forward from the types of loans, it’s crucial to know about the different financial lenders who can provide these loans.
Types of Financial Lenders
Financial lenders play a key role in providing overseas education loans. Banks, being the traditional and most common source, offer both secured and unsecured education loan options with established processes that have relatively favourable terms. Non-Banking Financial Companies (NBFCs) are a growing part of this area too, often offering more flexible terms and quicker processing compared to banks.
Additionally, International Lenders, offer substantial loan amounts in foreign currencies to students seeking education abroad. Each type of lender has its advantages and unique processes, so it is necessary for students to evaluate different choices and choose the most appropriate lender according to their requirements.
After understanding the lenders, the next significant aspect is the loan amount.
Maximum Loan Amount Offered
The loan amount offered for overseas education varies significantly based on the lender, the country of study, and the student’s financial profile. They include:
- Nationalised Banks: Up to INR 1.5 crores for secured overseas education loans & INR 40 lakhs for unsecured overseas education loans.
- Private Banks: Up to INR 1.5 crores for secured overseas education loans & INR 75 lakhs for unsecured overseas education loans.
- NBFCs: Up to INR 1.5 crores for secured overseas education loans & INR 75 lakhs for unsecured overseas education loans.
- International Lenders: Up to USD 100,000 for unsecured overseas education loans.
Normally, banks and NBFCs give loans that pay for a big part of educational costs, sometimes even 100% coverage including tuition fees and living expenses. International lenders may provide customized loan packages based on the specific needs of the student and the cost of education in the host country.
For students, it is very important to consider the total education costs and choose a loan amount that can sufficiently cover these expenses. After understanding the loan offerings, let’s look at the list of expenses covered by the education loan for studying overseas.
List of Expenses Covered in Education Loan for Abroad Studies
Overseas education loans typically cover a range of expenses essential for studying abroad. This involves,
- Tuition Fees: Typically, the largest part of educational costs.
- Living Costs: Includes accommodation charges, food, and other daily needs.
- Health Insurance: Covers protection against medical emergencies while studying abroad.
- Visa Fees: Expenses related to obtaining the student visa.
- Air Tickets: Costs for travelling to and from the study destination.
Often, costs related to studies like books and other materials are part of the loan too.
In conclusion, an education loan for abroad studies can offer crucial financial support, but it requires careful consideration of various factors, including the types of loans, financial lenders, loan amounts, and covered expenses. Therefore, consulting with overseas education loan advisors can make a big difference. They can offer guidance according to the needs and help aspirants with supervising the loan process quite efficiently.
So, connect with an expert today and get started with the loan application process!
