Education Loan in Pune

Education loan interest rates in Pune differ according to the nature of the loan; whether it is for local studies or abroad. Most of the banks provide fairly good rates which start at 8.30 %, with further discounts offered to female students and those who opted for particular repayment terms. This section is gonna offer you a comprehensive analysis of the interest rates offered by different banks in Pune and whether one is allowed to get a discount, especially when borrowing through a specific bank. 

For studies in India

For Foreign studies

While opting for education loans from the bank or any NBFC in Pune, there are many aspects to consider that do affect the student loan in a big way. Starting from the costs incurred to cover the required expenses to repayment periods, loan margins, and collateral, all these components of an education loan have a significant bearing on the feasibility and cost of obtaining an education. This section explains education loans pointing out the features and terms to enable the students and their families to make the right decision on funding their education.

Covered Expenses

Students availing an education loan from banks or NBFCs in Pune are covered for the following expenses

• Course Fees
• Accommodation and hostel fees
• Cost of books and stationeries
• Cost of traveling (air tickets, if the student is going abroad)
• Food and mess expenses
• Project cost, uniform cost, and cost of thesis work
• Computer purchasing cost 

All other study-related expenses made within the study duration in India or abroad will also be covered in the education loan, provided the student gives proper proof of expenses.

Moratorium Period

The moratorium period or repayment holiday is the period after the loan is disbursed, in which the student does not have to start repaying the loan. Generally, the moratorium period is the duration of the course plus 6 months or 1 year depending on the bank and type of education loan. 

Loan Margin

Applicants do not get the entire asked loan amount as an education loan, there is a loan margin in every bank. Loan margin is a portion of the entire loan amount which is calculated percentage-wise, the borrower has to arrange by themselves and show it to the bank to get the rest as an education loan from the banks. 

By keeping a loan margin, banks usually check the paying capacity of the borrower

Generally,

• There is a loan margin of 5%, to study in India
• There is a loan margin of 15%, to study abroad

The loan margin amount depends on the place where you are planning to study and also on the education loan type.

Collateral Margin

There are mainly 2 types of collateral that students can pledge with banks to study in India or abroad, immovable properties and movable or liquid securities pledged in the bank.

The collateral margin is a percentage of the value of the pledged collateral up to which a loan can be offered to the applicant. Depending on the type of collateral, banks have different percentages set for each type of collateral on which they provide education loans. 

Public banks like the State Bank of India offer an education loan of value up to 100% value of the immovable property as collateral, while others offer an education loan of value up to 100% of the liquid security, depending on the type of liquid collateral. Ask your financial officer at WeMakescholars to know the exact loan amount that can be offered to you for your collateral security.

The banks ask for specific information with proofs and documents to verify and process a student's loan profile. To apply for an education loan in Pune, students will need to submit the following documents:

Section 1: Application form with 2 Photographs

Completely filled education loan application form with 2 passport-size photographs is mandatorily required. Hardcopy of the form filled out online through the WeMakeScholars website is also acceptable. 

Section 2: Applicant, co-applicant, and/or guarantor’s basic information

1. Proof of identity

• PAN Card
• Aadhar card 
• Student’s passport

2. Address Proof (in case present and permanent address are the same, then the student will have to submit 2 different residence proof documents)

• Ration card
• Electricity Bill
• Voter ID Card
• Telephone Bill
• Aadhaar card
• Bank passbook statement

3. Documents of co-applicant 

• If the co-applicant is salaried they need to provide the last 6 month’s bank statement
• If the co-applicant is self-employed they will have to show their business transactions of the last 1 year

4. Statement of assets and liabilities approved by the bank employees

Section 3: Academic documents of applicant

• Proof of admission of a student in the eligible university or course
• The total course fees in writing with payment deadlines
• Proof of clearing IELTS/ GRE / GMAT or whichever applicable examination
• Academic mark sheet of class 10th, 12th, and bachelor

Section 4: Income proof documents of financial co-applicants 

If Salaried

• Salary slips of last 3 months 
• Last 2 years ITRs
• Last 2 years' details of Form 16
• Office ID card of the applicant

If Self-employed

• Last 3 years' Income Tax Returns
• The balance sheet of the last 3 years showing profit and loss statements. 
• Proof of address of the business

Section 5: Other Documents

• A declaration from the co-borrower of the loan, mentioning that they will take care of all other expenses that are not covered in the education loan
• Student and co-applicant must also provide a joint affidavit to the bank in their prescribed format

Section 6: Additional docs (if applicable)

• If there is any payment made in the name of the university, then payment receipts will be required
• Pending loan statement of last 1 year
• Students' gap certificate on 100 Rs stamp paper giving out the reason for gap in academics

Acceptable collaterals in Pune for education loans

• FD, Insurance policy, Government bonds
• House, Flat, in residential areas with all required documents
• Commercial properties 
• Agricultural land 

Students are required to submit the below-mentioned necessary immovable collateral documents in the bank along with the usual collateral documents:

• Receipts of payment done to the builder or seller
• An analysis report of the structure of the property will also be required if the property is very old
• A share certificate will be required if the property is a resale property
• A NOC from society management or builder in said format
• Power of attorney confirmation from the builder
• Property's conveyance deed
• If the property is new then a commencement certificate (CC) will be required

To apply for a collateralized education loan in Pune, the above-mentioned documents will be required. However, the requirements of documents vary from state to state. Get in touch with your financial officer who has the most accurate list of required documents. Speak to your financial officer who will give you a detailed documents checklist.

WeMakeScholars is a government-funded student website that aims to support students in Pune and throughout India to find financing options for their further studies anywhere in the country or even outside. In India, we have partnerships with more than 14 public and private banks as well as NBFCs. These additional arguments support your decision to work with WeMakeScholars for your student loan needs:

Expert advice: After carefully examining your loan profile from all sides, your financial officer will assist you in selecting the best lenders based on bank regulations and your eligibility.

Less processing time: WeMakeScholars processes student loans in half the time that banks normally do. If you receive your loan from a private bank or NBFC, it will take us just 6-7 days; if you obtain it from a public bank with security, it would take us 15-20 days.

Better Interest Rates: As the bank's largest partner for education loans, we give everyone an interest rate reduction ranging from 0.5% to 2%.

Digitization of the application process: Students may quickly submit an online application for a student loan at any time and from any location. Our documentation site also lessens the hassle of making multiple journeys to the banks just to give in the required paperwork.

Tax benefits: We help you save money and receive tax benefits on your tuition fee by informing you about the income-tax dept's tax-saving initiatives, like Section 80E, 80C, and many others, in addition to the tax collected at source (TCS).

Support and negotiation: We provide assistance in discussing loan conditions and rates of interest with the banks to ensure that the procedure is straightforward for you.

End-to-end assistance: If you encounter any post-sanction issues, your financial officer will be available for you at all times, including when the loan is distributed.

Complimentary services: As a component of the Digital India Campaign, we get support from the IT Ministry for granting student loans totally free of cost.

Cashback offer: A cashback of Rs 3000 will be given to you upon your loan disbursement

The repayment method of an education loan is a significant thing that a student and his/her parents need to know as it affects future liabilities. This section contains a typical repayment plan as a reference to show the effects of loan amount, interest rate and repayment period on the monthly instalments; also the manner of allocation between interest and principal throughout the period. Through breaking down such aspects, the borrowers will understand how their obligations will look like once they are done with their studies, thus enabling them to manage their loans appropriately.

For example, when a student takes an education loan of Rs 50 lacs at an interest rate of 10% for a tenure of 12 years, then the student will have to repay the loan as per the following amortization schedule: