Dreaming of studying in the USA but worried about the costs? Education loans simplify the process, helping students manage the financial challenges of overseas education. Here’s how to secure an education loan for studies Abroad.
Why Choose an Education Loan to Study in the USA?
Education in the USA is globally renowned for its quality and career opportunities. However, the costs, including tuition fees, living expenses, and health insurance, can be overwhelming. Education loans provide the following benefits:
- Cover tuition, accommodation, travel, and other expenses.
- Offer flexible repayment terms aligned with your post-study income.
Popular Education Loan Providers
Several Indian and international lenders offer education loans for studying in the USA. Here are some prominent options:
Indian Banks
- State Bank of India (SBI): Global Ed-Vantage Scheme for top-ranked universities with attractive interest rates.
- Bank of Baroda (BoB): Loans up to ₹1.5 crore, with competitive interest rates for premier institutions.
- Axis Bank: Offers customized loan solutions for international students.
International Lenders
- MPOWER Financing: No collateral or co-signer required; perfect for Indian students attending select universities in the USA.
- Prodigy Finance: Specializes in postgraduate education loans with repayment options suited for international students.
- Leap Finance: Designed for Indian students, offering fast processing and competitive rates.
Key Eligibility Criteria
Some basic requirements need to be satisfied for an education loan in the USA:
- Admission Letter: Evidence of being accepted by an accredited institution.
- Academic Background: Good performance in academics helps in increasing the chances of approval.
- Co-applicant: One of the parents, guardian, or a relative who is earning and has a fair credit history.
- University Tier: Those who apply to higher-ranked universities are more likely to get attractive loan terms.
Documents Required for Loan Application
The below list of documents needs to be kept for easy completion of the loan:
- Identity Proof: Passport, Aadhaar, PAN card.
- Academic Records: Admission letter, transcripts, GRE/TOEFL/IELTS test
- Income Proof: Payslips, IT returns, and bank statements of the co-applicant.
- Expense Breakdown: Detailed breakup of expected tuition fees, living expenses, and travel costs.
- Collateral Papers (if applicable): Property deeds, fixed deposit certificates, and the like.
Interest Rates and Repayment Options
A wide range of options are available in terms of interest rates and repayment schemes. Some of them include:
- State Bank of India – SBI Overseas Education Loan: 8.5% for institutions of national importance with repayment prospects for up to 15 years.
- Bank of Baroda Overseas Education Loan (BoB): Students are offered a 0.5% concession for female students.
- MPOWER Financing: The interest rates of 12.99% and above are fixed and for varying repayment periods.
Common repayment modes include:
- Moratorium Periods: Many lenders offer the option of not repaying the loan for 6 to 12 months after the course’s completion.
- Partial Interest Payments: Certain lenders require only simple interest payments during the study period to lessen total debt.
Tips for Securing the Best Loan
- Compare Lenders: Make sure to screen interest rates, fees, and duration of repayment.
- Apply Early: Start 2-3 weeks before the deadline to take out a loan.
- Check Scholarship-Linked Loans: If you have such loans, try to decrease the loan amount through it.
- Consult Experts: Advisors can explain how to get the best options.
Why Choose Imperial Overseas?
Eduloans specialize in guiding students through the education loan process, ensuring a hassle-free experience. With our expertise, you can:
- Identify the best loan options tailored to your needs.
- Prepare accurate documentation to increase approval chances.
- Receive end-to-end support, from application to disbursement.
Let us help you take the first step toward your dream of studying in the USA. Contact Eduloans today!
FAQs
Q1. Can you get an education lost for the USA without collateral?
A1. Yes, some lenders like MPOWER Financing and Prodigy Finance offer loans with no collateral for international students of selected universities.
Q2. What is the time frame for repayment of education loans?
The majority of loans take about ten to fifteen years to pay off, which includes a course duration and twelve months after the course has been finished.
Q3. On average, how long does it take to get an education loan?
It does take a little time for the loan to be approved but it is not too long and usually is between two to three weeks as long as all documents required have been submitted in time.
Q4. Are there any tax benefits available to Indian students on an education loan?
Yes, such students are eligible for a tax exemption on the interest paid on their education loans under section 80E of the Income Tax Act.