Education loans are genuine accelerators for students seeking financial support to further their education. You don’t have to be born with a silver spoon to make your dream of studying abroad come true. The funds available through this loan are meant to cover the cost of college fees, coaching fees, hostel charges, and a few others.
However, many people were unable to obtain this loan because they were unaware of the required education loan documents. Parents may also be hesitant to take out this loan since they are ignorant of its benefits.
So, in this article, we will go over the list of required documents as well as the advantages of taking out an education loan.
List of Essential Medical Loan Documents
The lender approves your education loan only after you have submitted all the essential documents. Your application will be rejected if any of the required documents are missing. So, let’s take a look at the paperwork process to avoid such situations.
KYC Proof:
- Aadhar Card/ PAN Card/ Driving License/ Valid Passport/ Utility Bill/ Voter ID Card/ Rent Agreement/ House Ownership Documents
Education Related Documents
You will need to submit all the documents related to your post-academic records. The following are the documents related to your previous educational qualifications.
- High school mark sheet & passing certificate
- Intermediate mark sheet & passing certificate
- 3rd year or final year mark sheet of the undergraduate course
- Special education certificate, if any.
- Scholarship certificate, if any.
- Diploma certification, if any.
In addition to evidence of previous qualifications, the lender will need documents linked to the college to which you intend to enrol. These papers include the following:
- A document provided by the college that consists of fees breakup
- The placement record of that educational institute
- Letter of admission or conditional admission letter
In the case of an overseas admission, the list contains a few more documents. Some of them include student exchange forms, scorecards of tests like GMAT, GRE, IELTS, and TOEFL, and entry permits.
Financial Documents:
Self-Employed Parents:
- Turnover proof
- Recent income tax returns
Salaried Parents:
- Salary slips or certificates provided by the existing or previous employer
- Recent bank account statements
- You will need a pension certificate if your parent has retired from work and is getting a monthly pension.
Benefits of Education Loan:
Education loans offer some great benefits. Some of them are listed below.
Savings Remains Intact:
Given the escalating expense of education in India and overseas, relying on your savings to fund your child’s further education will put you in financial trouble. However, with the easy availability of loans for education, you don’t need to worry much.
Tax Advantage:
Education loans are also subject to tax exemptions. The amount you pay towards the interest component is subject to tax deduction under section 80E of the IT Act 1961.
Covers Multiple Expenses:
A loan for education can be used to pay for a variety of things, not simply university fees. It covers travel expenses, laptops, living expenses, lodging costs, insurance, and a few other things.
Builds Credit History:
You assist yourself develop your credit history by repaying your debt obligations on schedule. The loan will help you prepare for a larger loan in the future, such as a home loan.
No Collateral Loan:
The college/university to which you are applying for an admission is a critical component in your education loan approval. Your loan will be approved quickly if the college has a good placement record, and you won’t have to put up any collateral.
Pay after Completing your Course:
You are not obligated to begin repaying your loan immediately after receiving it. The loan moratorium will be in effect until the end of the course term. Furthermore, some lenders will prolong this term to six months or a year so that you can easily find employment.
What if you don’t have all the documents mentioned above?
There might be a situation where you might fall short of certain key documents. In addition, most financial institutions ask you to provide a guarantor for an education loan if the disbursement amount is high. In such instances, the best alternative is applying for a personal loan.
Personal loans have no constraints on how they can be used. The entire loan amount can be used to cover your higher education costs. To acquire this loan using an online cash loan app, you don’t have to provide a long list of documents. You only need to provide KYC and income proof to obtain a personal loan for education.
To Conclude:
If you don’t need finances to cover the entire cost of education but only need money to cover some essential educational expenses, you may be able to do so using an online cash loan app. But, in both cases knowing about the education loan documents is important.
Rehan is a student of Masters at the University of Birmingham. He loves writing about business, finance, technology, and life. He believes that sharing knowledge with the public is the best thing that one can do for the world and humanity.
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