Webinar: Everything About Unsecured Education Loan

An education loan without collateral is indeed a savior if you do not have a collateral to mortgage against your education loan. There’s no denying that; for students with no income and property to fall back on, education loan without collateral is an easy way to raise funds for their higher studies abroad. But there are several other aspects to an unsecured education loan that are complex in nature and need to be understood to make good loan decisions. In this webinar, we will discuss the various facets of an unsecured education loan including the following:

  • Major providers of unsecured education loans
  • Rates of interest
  • Processing fees
  • Comparison between loans from different lenders
  • Advantages and disadvantages
  • Risks involved

This Webinar is sponsored by Incred Finance.

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Answers via video: On Saturday, January 11th, at 5.00 PM, Your questions will be answered via a webinar, which you can join here.
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I need loan amount of 20Lakhs rupees. But I dont have any collateral, also my parents income is very less. Will I be able to get loan?

Is it advisable to apply for loan as soon as you get acceptance from any university(so that you get the loan letter) and change the university later (in order to avoid the last minute rush)? If yes, how complex is it to change the university later?

  1. Can you please tell us what documents are absolute necessary while applying for an education loan.
  2. What will be the time required for the whole process. (from application to sanction)
  3. I need an education loan for 2 years. So how are the disbursal installments like.

Can you please tell me about academic eligibility criterias for an education loan application.

Replying on behalf of the speaker -
Yes, InCred can help you get an education loan even without a collateral. Required co-applicant, apart from your immediate family member, can also be your uncle or aunt. So, yes, you can get an education loan upto 20 lakh rupees. As per your question, definitely without collateral/unsecured loans are possible based on factors like your undergrad school, your undergrad performance.

Replying on behalf of the speaker -
You can apply for the loan before getting accepted. It is in fact good to apply beforehand, to make sure you have the financial support that you require. Most universities are likely to ask you for your financial documentation. Hence, it makes sense to apply for a loan before you start applying for universities, or while you are doing so.
Now, coming to your question, you can definitely request InCred to change your university or program. If you are changing to a similar kind of program, say Mechanical to Industrial Engineering, it should not be much of a challenge. Also, if the new university is of the same quality or TR or better than the earlier one then there are still no challenges. Now, if your program or university appears to be very different from what you initially opted then InCred may actually revisit the whole loan process and loan offer a little bit. In that case, your terms and conditions might change. However, the possibility of a change in the terms and conditions is very minimal.
So if you want to change your university, it is a very easy process with InCred. You just have to update your University with GyanDhan or your InCred representative and we can get it changed for you within 2 days. You just need to contact the GyanDhan team and they will pass on the request to the InCred team who will then get back to you with the new education loan for the new college or they will tell you that they have to re-evaluate since the changes you made were too extreme.
So, yes, Karan, it is advisable that when you talk to your counselor at GyanDhan. Let them know that you are interested to apply before the admit and they will tell you all the options for which you can apply.

Replying on behalf of the speaker -
—> As far as the documents are concerned, they vary a bit depending on the case in hand. But I will give you a little idea about the documents that are required in general. From you, your basic KYC documents, your academic documents: undergrad degree, transcripts, if you are applying after getting admission then your offer letter, your GRE, GMAT scores, IFS score proof, etc. Talking about the co-applicant, KYC documents are necessary. And another important factor that most students miss is the ITR and Form 16. Now, these institutes have to follow certain guidelines as specified by the RBI. Hence, they have to look at the CIBIL scores and the co-applicant’s income so that they can know, in case the student is unable to repay the loan, whether the co-applicant will be able to do so or not. Thus, the co-applicant’s bank statements, ITR, and Form 16 become absolutely necessary to get a loan. To give an idea about income requirement: If your parents have a business, a three year ITR, Form 16 should suffice. If they are salaried, two year ITR, Form 16 would be required along with salary slips and bank statements for 6 months.
If you are applying for a loan of 20 lakh rupees and going to a decent college, the income should be around 40-45 thousand rupees per month to get the loan approved. Now you can calculate it for 30 or 40 lakh rupees as well. The required income obviously varies from college to college and from country to country.

—>Going to the second question, once the documentation is done, the InCred team is very fast and can get your loan approved in 2-3 working days. The documentation takes the most time as there is usually some confusion and not all documents are available at the same time. Hence, the duration of the process depends on you and how ready you are with your documents. If you are ready with all your documents and you submit them today, you can expect your work to be completed in 3-5 working days. Your loan cannot be approved if you have not submitted all the documents. So, if even one document is pending that will cause a delay in the process.

—>To answer the third question, I will give you an overview here. But I would recommend you to go to Gyandhan.com and check out the customized education loan EMI calculator that we have built. You can change the moratorium period, grace period, depending upon your specific loan and it will show your repayment schedule accordingly. For an education loan of 2 years, you can take disbursal periods as per your convenience. Suppose in the first semester, you need 5 lakhs, you can take 5 lakhs. In the second semester, you need another five lakhs, so you can withdraw another 5 lakhs. Therefore, you take them as per your requirements. There are some countries, where pre-visa disbursal is necessary, like Canada where you have to put money in GIC, or Germany, Australia where you have to pay the fees before applying for a visa. If that is the requirement, these new age lenders also give you a loan before the visa.

Replying on behalf of the speaker -
The eligibility requirements may be different from one lender to another. Overall, you should have admission to a course, if you want to apply for a loan. You might have an admission letter or you are planning an admission, both are acceptable at InCred. Also, to be eligible, typically a bank would require that you apply to the bank branch closest to your native town or permanent address. Like, if you are living in Pune but your parents are in Delhi, you will probably have to apply for the SBI or BOB branch in Delhi. But again, with InCred, you can apply at Pune, Delhi, wherever you please.

Only requirements are -

  1. You should have an Indian passport, you should be an Indian citizen

  2. You should be 18 years or more

  3. You should have one or more co-applicants or guarantees to the loan which are usually parents or family members. In case of InCred, we take relatives as well

  4. Your CIBIL score or credit history, that is yours as well as your co-applicant’s credit history should not be negative or really bad. If the CIBIL scores are bad, it might get a little challenging to get the loan.

Also, in the case of most banks, you need to give them a collateral security, which is a property to guarantee or backup the loan. At InCred, depending upon the course college, the collateral part is completely optional. So, depending on where you are going to study, you may not give us any collateral at all. Obviously, your co-applicant should have financial paperwork - ITR or Form 16 depending on if they have a business or are salaried individuals. One of your co-applicants should also have an operational, active bank account with cheque writing facilities because the repayment of the loan will be set up through that bank account.

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