Studying Abroad has become the most suitable option for many students in India nowadays. As per a report of the Reserve Bank of India, spending on tuition and hostel fees by Indians studying overseas has gone up by 44% from $1.9 billion in 2013-14 to $2.8 billion in 2017-18. This shows the rising trends for studying abroad. Among all the nations abroad, the United States has always been the top international destination for Indian students. The number of Indians studying in the US makes up around 17% of all the overseas students studying in the country.
However, the biggest challenge that is faced while applying for study in the USA is the way to arrange funds. The living expenses, as well as the cost of tuition being high in the USA, make it difficult for students to afford to study over there. But in order to fulfill your aspiration to study abroad, you need a way out. So, banks are here to help us in arranging loans for our study abroad dream.
Let’s go through the complete guide to Education Loan for the USA:
Generally, the application process for a majority of US universities starts in the month of October. In order to avoid the hustle at the last moment start as early as possible. Determine the loan amount that will be required to cover all your expenses and be ready with all the necessary documents like:
The documents may vary according to the bank. You can refer to the bank for the complete list of documents.
Start looking for a bank that is ready to give you an education loan and compare different banks on the basis of the following described criteria:
Some of the different bank schemes are:
After receiving the I-20 form from the university, the loan will be disbursed to you from the bank. The I-20 form will contain all the necessary details like university code, address, department details, course duration, fee details, living expenditure, and SEVIS (Student and Exchange Visitor Information System) number.
Collateral is a property offered to the bank as a security. Any liquid asset preferably shares, bonds, FD or any immovable property like the house, any commercial property or land can be classified as collateral. Agricultural land will not be considered as collateral.
First of all, you need to decide whether you want to take an education loan with collateral or without collateral.
|Loan Amount with Collateral||Loan Amount without Collateral|
|More than INR 7.5 Lakhs||Up to INR 7.5 Lakhs|
To know more about collateral click here.
If a loan amount exceeds INR 4 Lakhs then the bank will ask for a guarantee by a third party. A guarantor will have a legal obligation to pay in case the borrower defaults on his payment.
The general eligibility criteria that are followed by all the banks are described below:
To know about other important terms related to education loanclick here.
Generally, the repayment of loan starts after the moratorium period (EMI holiday) or when the person has secured a job. The interest charged during the study period is simple interest while the interest charged after this is compound interest.
You can do the repayment via 3 modes:
So, even if the cost of study in the USA is high we can still fulfill our dream to study there with the help of an Education Loan.