Things you should know while getting an education loan

by Kritika Jose I'm a financial advisor with an experience of more
Personal loans are a great way to provide for your child’s education. As times are changing and as the education system changes with it, getting a degree has become very expensive. An MBA or a Masters’ degree can easily cost one up to 20lacs depending on which school you choose. If your child wishes to go abroad for their education you may have to shell out even more in order to provide for them. 

A personal loan can easily act as an education loan for your child or even for yourself. Student loan or education loan interest rates are high, but a lot of schemes offer you the opportunity of paying the interest only once you’re done with your education and when you start a job. They give you a period of a few months between your graduation and when you need start paying the interest on your education loan. 

 If you’re someone who is thinking of getting a degree or has a child who wants to pursue higher education then here are some things to know about education loans.

  1. Education loans can bring you tax benefits: The person who is repaying the loan can claim a deduction for the entire interest part of the loan under Section 80 E of the Income Tax Act. But there are certain limitations to claiming this deduction. Firstly, the personal loan should have either been taken from a scheduled commercial bank or from one of the two gazette financial institutions. If the education loan is taken from any other institution, this deduction cannot be claimed. 
  2. Personal loans help you pay all expenses: When you go to study abroad, apart from tuition you have many other expenses that you need to take care of. An education loan covers everything from your tuition fees to your boarding or hostel fees. You can also use this money to pay for your living expenses, groceries, conveyance and so on. 
  3. Girl students get special personal loan interest rates: Banks also offer an additional 0.5% discount if the loan applicant for the education loan is a girl student.
  4. Repay at your convenience: Banks generally offer a holiday period for the repayment of loan. Generally after the student graduates, the bank allows a period of six months during which he or she does not have to pay EMIs. If the student receives a job immediately, then the EMIs too start immediately after they’ve graduated.

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About Kritika Jose Junior   I'm a financial advisor with an experience of more

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Joined APSense since, November 17th, 2017, From Mumbai, India.

Created on Jul 1st 2018 06:22. Viewed 544 times.


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