The education cost in India has increased steadily over the last few years. You might be in a scenario wherein your current savings are not sufficient to mitigate your higher education costs. If you are a parent and want to ensure an education for your kid, then going for a personal loan might be a prudent choice.
A personal loan, whether it is through a bank or NBFC like Cashe or Paysense, permits you to pay not just your living expenses but also your tuition charges. Even while you might get an education loan tax benefit, if you go for the education loan, a personal loan might still be a good choice based on your requirements.
Discussed here is what a personal loan is for education and how it can help you.
What is a personal loan for education?
A personal loan is a kind of loan or a credit option offered by banks and NBFCs. The loan proceeds from a personal loan can simply be used for any purpose like education. If you avail of a personal loan for the purpose of education, you can use the funds to make the payment for your tuition fees and your accommodation fees and mitigate your living expenditures and other expenses.
A personal loan is a kind of credit facility or loan provided by banks and NBFCs. The personal loan proceeds can be utilized for any purpose involving education. In case you avail of a personal loan for the purpose of education, you can utilize the funds to pay for the tuition fees and accommodation fees and mitigate your living expenditures and other expenditures. A personal loan is unsecured in nature. It means you do not require providing any security or collateral like jewellery or property when you avail of such a loan.
You can place an application for a personal loan online. For this, you do not require visiting the lender’s branch or office. The loan application procedure does not take over a few days, and you can have funds placed in your authorized bank account within some hours of loan approval.
What are the advantages of opting for a personal loan for education purposes?
Here are a few of the reasons why you must consider availing personal loan to mitigate your educational expenditures –
You do not require to have an extremely high credit score to be eligible for the personal loan. A credit score is given to every individual by the CIBIL to know the individual’s creditworthiness. Higher your credit score, the simpler it is to receive loan approval. Lenders even check your score before final loan approval.
A credit score for approval of a personal loan requires being over 750. You do not require providing complex financial information about yourself at the time of availing of the personal loan. Lenders can approve your personal loan application based on your score. Thus, if you meet this parameter, half your work is done.
It can be used for any purpose
As mentioned previously, a personal loan can be utilized for any purpose, dissimilar to an education loan. If you avail of an education loan, then the loan proceeds will be disbursed directly to the particular bank account belonging to your college or school. However, if you avail of a personal loan, then the loan proceeds will get deposited in your own bank account.
Hence, you can utilize the personal loan to mitigate any kind of expenses, including your accommodation expenses, living costs and others. On the contrary, an education loan can just be utilized to mitigate your college and school fees. This is the major benefit of availing of a personal loan as compared to an education loan.
Zero requirements for security or collateral
A personal loan does not need you to provide any security or collateral like jewellery or property. As these loans are entirely unsecured in nature, the borrower does not require worrying about losing out their property or belongings in the case they fail to make the loan repayment on time.
Despite the unsecured nature of a personal loan, the borrower needs to make a higher interest payment. This lowers the burden or stress involved with availing of such a loan. Moreover, you do not require pledging a costly asset to get a personal loan. Eligibility parameters are less strict as compared to other loan kinds.
High loan proceeds
Personal loan proceeds can go up to Rs 40 lakh. Note that the proceeds for personal loans differ from one lender to another. It is clear that such a loan proceed will be totally adequate to repay for an excellent education in India. You might have adequate funds to mitigate other expenditures besides school or college fees. These high loan proceeds without any security or collateral make personal loans an extremely attractive choice for students.
High loan proceeds also mean that you hold the flexibility to select the sum you are comfortable with. You do not require availing smaller sum due to the loan limits and then fret regarding meeting the monthly expenditures.
Flexible repayment tenures
Based on the lender, a personal loan can be flexibly repaid in 5 years. You can select the loan tenure while making the loan application. Such a flexible loan repayment tenure means you can prioritize monthly payments or lower interest payments based on your requirements.
A higher repayment tenure means the overall interest component that you require to pay will be on the higher end. On the contrary, shorter repayment tenure will equate to monthly repayments that would be on the higher end.
School and college admissions require funds instantly, and they do not wait for anyone. For this, you must deposit the required fees for the year in a short time period to get admission. Here is where fast personal loan disbursal can assist you.
The whole loan application procedure can be done online. Once you have applied, the lender will instantly check your personal loan application to view if all is in order and then accordingly sanction the loan in a few days from the application date. Once the loan gets approved, you will get the funds in your bank account in 24 hours.