Australia can be a great place to study, as it opens doors to a world of career opportunities. However, the admission fee and other expenses can be a showstopper for many people. Admission loans can be one way out, as they cover the tuition fee, rent, and much more. Let’s take a look at the different types of Loans available for students who want an education in Australia.
Types of Education Loans
Secured Education Loans: These loans, especially secured ones, can be obtained by keeping property, fixed deposits, or life insurance policies as collateral. The amount secured can be high with lower rates of interest.
Unsecured Education Loans: No collateral is required, but the eligibility conditions are stringent, and the interest rates can be high. In this case, the student’s academic record and the financial status of the co-signer can influence approval.
International Lenders: Organizations that offer unsecured loans, such as Prodigy Finance and MPOWER Financing, lend to overseas students based on future earnings estimates rather than students’ assets or cosigners.
Top Indian Banks Offering Education Loans for Australia
State Bank of India Overseas Education Loan (SBI)
- Scheme: Global Ed-Vantage
- Loan Limit: Up to INR 1.5 crore
- Interest Rate: Starts at 11.15% (concessions for female students available)
- Features: Includes simple interest payment options during the course.
Bank of Baroda Overseas Education Loan (BoB)
- Scheme: Baroda Scholar Loan
- Loan Limit: Up to INR 1.5 crore
- Interest Rate: 9.70% to 11.15%
- Features: Covers tuition, living expenses, and more.
Axis Bank Overseas Education Loan
- Loan Limit: From INR 50,000
- Interest Rate: 8% to 16%
- Features: Loans for undergraduate and postgraduate studies.
Credila Overseas Education Loan
- Loan Limit: Up to INR 40 lakh (unsecured); higher for secured loans
- Interest Rate: Varies by course and university.
- Features: Flexible repayment and quick disbursement.
International Lenders for Education Loans
Prodigy Finance
- Loan Limit: Covers up to 100% of attendance costs.
- Interest Rate: Starts at 9%.
- Features: No collateral or co-signer is required; repayment begins post-completion.
MPOWER Financing
- Loan Limit: Up to $100,000.
- Interest Rate: Fixed rates from 12.99%.
- Features: Focuses on the student’s future earning potential.
Leap Finance
- Loan Limit: Customized for the course and university.
- Features: Quick approvals and flexible repayment plans.
Eligibility Criteria for Education Loans
To qualify for an education loan to Study Abroad:
- Admission to a recognized Australian university.
- A strong academic record.
- A co-applicant (parent or guardian) with a stable income (for secured loans).
- Creditworthiness for unsecured loans.
Expenses Covered by Education Loans
Most loans cover:
- Tuition fees
- Living expenses
- Travel and insurance
- Study materials and equipment
- Research or project-related costs
Comparing Indian Banks and International Lenders
|
Aspect
|
Indian Banks |
International Lenders |
|
Collateral |
Required for amounts over INR 7.5 lakh |
Not required |
|
Interest Rates |
9.50% to 13.25% |
9% to 13% (variable or fixed) |
|
Loan Disbursement |
Direct to university or student account |
Direct to university
|
|
Repayment |
Starts 6-12 months post-course |
Flexible, income-driven options |
|
Processing Time |
10-15 days |
7-10 days |
Interest Rates and Repayment Terms
- Interest Rates: Indian banks offer rates from 9.50% to 13.25%, while international lenders start at 9%.
- Repayment Period: Most loans offer terms up to 15 years, with a moratorium covering the study duration and 6-12 months after completion.
Key Considerations
1. Part-Time Jobs in Australia: It allows students to work for a maximum of 24 hours, bringing down the cost of living significantly.
2. Tax Relief: Payments made against educational loans are exempt through section 80E of the Income Tax Act.
3. Loan Protection Insurance: A few banks will require life or property insurance for loans.
Conclusion
Education loans bring hope to many students who have the passion to study and work in Australia. There are plenty of options available with Indian banks and foreign lenders, but careful homework is essential in finding the most suitable loan for your pocket.
Looking for expert advice on securing an education loan for studying in Australia? Eduloans offers personalized guidance to help you find the right loan and simplify the process. Contact us today to make your study abroad dream a reality.
FAQs
- What is the term of the education loans for repayment?
It is from a period of 7 years and can be up to 15 years, with options for early repayment. -
Can I get a loan without collateral?
Yes, unsecured loans are available, but likely with a co-borrower having regular earnings. -
Is it possible to borrow a loan covering living expenses?
Yes, the bulk of such loan financing covers tuition, accommodation, and other expenses like mobilization and insurance, among others. -
Are there providers of international loans whereby a co-borrower is not a prerequisite?
Indeed, some providers, such as Prodigy Finance and MPOWER Financing, do not need co-borrowers.