These days, students do not believe in depending on their parents and wish to finance their education independently. Therefore, they turn to student loans, which act as an excellent tool to earn a self-made badge. However, since students are often first-time borrowers, they might not be aware of the key factors to consider when applying for a student loan. So, let’s explore them together!

Key highlights:

• What You Must Keep in Mind When Applying for Student Loans
  • Research, Research and Research
  • Know the Right Amount Before Applying for Student Loans
  • Documents Required to Apply for Study Loan Online or Offline
  • Be Ready With the Repayment Plan When You Apply for an Education Loan
  • Check the Costs Covered When You Get a Study Loan

What You Must Keep in Mind When Applying for Student Loans

Research, Research and Research

Before you apply for an education loan, you must conduct thorough research to find a perfect student loan partner. Students often make the common mistake of shortlisting the financier based only on interest rates. However, you must also consider other aspects such as benefits extended to you, repayment options, time taken for sanctioning student loans, costs covered, and customer service, to name a few.

Know the Right Amount Before Applying for Student Loans

Your education loan Equated Monthly Instalments (EMIs) will spread over the years. You must select the loan amount and tenure that best suits you. Several online calculators are available to assist you in making a well-informed decision.

For instance, you can use the College Course Expense Calculator to understand your potential college expenses. Eligibility Calculator can be used to understand the approximate student loan amount you are eligible to borrow based on your current finances. Also, you can try the Education Loan EMI Calculator to find the right mix of loan amount and tenure.

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Also Read: How to Choose a Private Student Loan Provider

Documents Required to Apply for Study Loan Online or Offline

Whether you want to apply for a student loan online or offline, you must have your documents ready. Here are some important documents:

• For students:
  • 2 colour passport-sized photos
  • Photo ID
  • Residence proof
  • Date of birth proof
  • Signature verification
  • Academic documents
  • Proof of admission
  • Fee structure

• For co-applicants:
  • 2 colour passport-sized photos
  • Photo ID
  • Residence proof
  • Date of birth proof
  • Signature verification
  • Income proof
  • Collateral documents (for secured student loan)
  • 8-month bank statement
  • Relationship proof

Also Read: What Students Must Know About Education Loan Eligibility Criteria

Be Ready With the Repayment Plan When You Apply for an Education Loan

When you get a study loan, it will come with a moratorium period, which is like a grace period where you are exempt from making repayments for a short period of time. This holiday period refers to the time between the loan amount reaching you and when you make your first EMI payment. The duration of the moratorium period will vary depending on the lender.

However, it is recommended that you make contributions in the form of simple interest (SI) or partial interest (PI) during this holiday period. As this is not an interest-free period, interest will accrue from day one. Also, paying SI/PI will instil financially prudent habits early on in your life. After you complete your course, your regular EMIs will begin.

Also, it is prudent to set an emergency corpus once you decide to apply for a study loan online or offline. This amount will help you continue with your repayment even during emergencies such as the pandemic. So, design an elaborate repayment strategy based on your financial requirements.

Check the Costs Covered When You Get a Study Loan

There will be several costs involved, especially if you want to study abroad. Therefore, education loans must cover the holistic cost of education, including tuition fees, travel expenses, accommodation costs, cost of learning devices, living expenses, study material costs and other education-related expenses.

So, this information will ease your education loan journey. At Avanse Financial Services, we understand the importance of quality education. Therefore, we offer a study abroad education loan and a student loan to study in India, with several features.

When you choose the Avanse education loan, you will benefit from 100% finance, quick loan sanctions and flexible repayment options. If you have any queries related to student loans, an educational loan calculator, or your academic journey, please feel free to talk to us. We will be glad to assist you.