Introduction
An education loan is an amount of cash acquired to fund post-secondary education or advanced education-related expense. Education loan plans are designed to take care of educational costs, books and supplies, and daily costs while the borrower is currently pursuing a degree, for which you can click on Study Loans for India.
Getting Interested In Free Education Loan
To get an Interest Free Education loan from a moneylender, you for the most part need to pledge security like house property, fixed stores, shares, security, and so on, to take the loan. This is done so that in the event that you default on the loan, moneylenders can recuperate it by selling the promised security. The security swore against a loan is named a guarantee.
Notwithstanding, you can get an education loan without pledging any security. The Credit Guarantee Fund for Education Loans (CGFEL) Scheme gives an assurance to training credit scattered by banks under the Model Education Loan Scheme of the Indian Banks’ Association (IBA). Under this plan, you can get an insurance-free loan sum of up to Rs 7.5 lakh without giving any third-party assurance.
In India, it is very difficult to find out any educational loan available with a 0% interest rate. However, there are a few other ways of getting an interest-free loan that can be adopted to lessen the impact of the educational loan interest rate.
Following are a few methods as mentioned below:
- Scholarship –
You can lessen the effect of interest by applying for grants. Different Scholarships are accessible relying upon your preferred review and organization. You can find them and apply for the ones that are pertinent to you. Indeed, even with normal grants, you may essentially take care of the loan’s advantage, making it to a lesser extent a monetary weight for yourself as well as your loved ones. - Central sector subsidy scheme –
Assuming your family’s yearly pay is under Rs.4.5 lakhs, the government will pay your advantage for the moratorium time frame, which is the course length in addition to a half year/1 year. Solely after an extended time of dependability in your work/business after the preparation would it be a good idea for you to start reimbursing. Up to that point, no interest is paid. - Model Education Loan Scheme –
IBA has formulated the ‘Model Education Loan Scheme’ for meritorious students to financially support them to pursue higher education in India and abroad. Generally, the guidelines issued by IBA for the CGFSEL educational loan scheme are followed by banks. However, the banks can vary in providing loans under this scheme as per their own internal rules.
Getting A collateral-free Loan Above Rs 7.5 lakh-
However, if the requirement for your education loan is more than Rs 7.5 lakh or even more than Rs 10 lakh, you can go out to other lenders to get a collateral-free loan. Private lenders and Non-banking financial companies (NBFCs) can provide you with collateral-free loans for a higher amount, but these collateral-free loans are sanctioned at a slightly higher interest rate as compared to education loans taken with collateral.”
For applying for any scheme and subsidy for an interest-free education loan, the person needs full documents of academic reports, aadhar card, and any necessary paperwork.
Eligibility for interest-free education loan
- Nationality
An applicant must be an Indian National to avail of an education loan in India. - Age criteria
An applicant must have attained 18 years of age and can avail of an education loan or your parents can take the loan in their name. An educational loan is not given if you are above the age of 35 years. - Percentage
It is important for applicants to must secured at least 60 percent in previous qualifying examinations. - Admission to an educational course
The applicant must have confirmed his admission to a college/university in India by the UGC/Government/AICTE/Appropriate authority. - Annual income
According to schemes, annual income should be within that specified limit.
No, it is not practically possible to get an education loan with a completely zero rate of interest from the bank. Moreover, applicants can apply for various scholarships or can check for various government subsidies to avail of an interest-free education loan.
