Education Loan Transfer: Guidelinesby Rita Biswas Consultant
Studying abroad is a lifetime goal for many of you. Having said that you will not leave any stone unturned to make your dream come true. For many international students, the higher education cost is a big concern. How to pay for those big one-off expenses such as tuition fees, airfares and insurance?
Well a very easy solution to this is taking an Education Loan for Abroad Studies.
Well the job is not done yet! The real deal begins once the loan gets disbursed and the clock starts ticking during the repayment tenure. While deciding on a loan provider, it is very important that you conduct thorough research of their terms and conditions regarding abroad education loans. But what if you end up borrowing education loan from a lender whose interest rates are very high or if their loan repayment policies are not convenient for you?
You tend to fall into the catch 22 situation.
If you are stuck in such a situation, there is always a way out- Education Loan Transfer
This article will tell how swapping your education loan provider is a safe way out of this kind of situation.
What is an education loan transfer?
If you are not satisfied with the education loan repayment policy of your previous loan provider and would like to opt for a student loan refinance from a different bank or an institution, you may apply for an education loan transfer.
Here’s how it can be done;
· Once you choose to go for an overseas education loan transfer, your old banker gives you a statement of the pending loan amount to be repaid
· This statement has to be submitted to the new bank or institute providing the student loan refinance
· Once the new bank receives and accepts this statement, they begin your loan process customarily
· Once your loan is approved, the new bank releases a cheque with which you can clear your pending dues with your former lender
· The new bank would require 3 documents from the old bank for the process to begin
· In case the previous loan is taken from a Co-operative Bank then loan transfer might not be possible
· If the previous loan is already taken from an NBFC then there is no scope of transfer
What are the eligibility criteria for an education loan transfer?
You can opt for an education loan transfer only when
· There are no more disbursements to be taken from their current lender’s loan by the loan applicant
· Any amount had to be disbursed from your previous bank has already been disbursed
· The loan applicant cannot borrow any more money from the previous loan
· Repayment towards your old loan has already started in the form of EMIs
· The process related to Mortgage Shifting from the old bank to new will be done by the Bank itself
· Parents have to provide LOD to the new bank (List of documents duly attested by previous bank)
· In case of Scheduled Banks the Loan can be transferred from one bank to another bank
Important Term and Conditions:
· Switch between collateral to collateral education loans - If you plan on transferring your current education loan from one bank to another, the new bank will take over your existing collateral.
· Switch between non-collateral loan to collateral loan - If you have non collateral loan with your current lender and you wish to transfer education loan to a public bank, which mostly grants collateral-based loans, you may have to place valuable collateral with the particular public bank.
· There is no loan margin
· The newly approached public bank will give you a 100% loan on the collateral value
The rest of the terms and conditions are similar to those of a regular abroad education loan. If you are still facing any doubt regarding your eligibility for a loan transfer, you can approach any education consultants and ask for assistance for Overseas Education Loan Process.
Created on Nov 22nd 2019 23:44. Viewed 211 times.