Applying for an education loan – the procedure you need to follow

01 Nov 2019

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We have all heard the age old saying that the path to a great career and successful life is paved through a quality education. Holding a higher education degree opens up many career avenues and helps you secure your financial future. But with the ever-rising cost of college and university fees, students and parents have no choice but to take on an education loan to fund higher studies. Education loans cover a host of expenses related to higher education such as the tuition and examination fees, hostel fees (if applicable) cost of books and apparatus, conveyance charges and so on. Here’s the education loan procedure you need to follow.

Do your research and choose the lender

Before you begin with the loan application procedure, you need to get the admission offer letter from the school you wish to attend, finalise the lender and then visit them online or in person. Let’s say you choose bank of Baroda as your preferred lender.

Fill the loan application form

If you apply for the loan online, you can find the loan application form on the lender’s website. As per the instructions of the Department of Financial Services, Ministry of Finance, Government of India, all education loan applications (including applications received by Bank in physical format) are to be applied through Vidya Lakshmi portal, i.e. https://www.vidyalakshmi.co.in/Students

Appear for the interview round

The procedure to take education loan continues with the interview round. Whether you apply for the loan offline or online, the bank may call you to appear for a personal discussion. The student wishing to study further is considered as the principal loan applicant, which is why he/she must be present for this discussion. The bank generally asks student applicants some basic questions regarding their overall academic performance, the degree they wish to pursue and the school they wish to attend and so on. They also ask questions regarding the possible income that can be generated from their chosen field. Based on the information provided by the applicant, the bank decides whether or not to proceed with the loan.

Provide the documents

The bank also asks you to provide some documents as part of the Bank’s education loan procedure. You need to submit the admission offer letter provided by your chosen university. The bank will also do its due diligence and verify your enrolment.

The bank approves the loan

After verifying your credentials, your student loan may be approved. The student’s one of the parents/guardians are listed as co-borrower or guarantors and the bank also checks the guarantor’s /co-borrower’s credit scores before approving the loan. Additionally, the applicant must also sign a promissory note and other prescribed loan documents, assuring the bank that the loan will be repaid within the stipulated tenure.

Loan disbursal

The last step in the education loan procedure is loan disbursal. After all formalities are completed, the bank disburses the loan amount directly into the bank account of the university the student wishes to attend. Disbursement can be done partially (–semester wise) or fully, at one go.

Keywords used

education loan procedure, education bank loan procedure, procedure to take education loan

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Advantages of personal loans to raise funds

There are times in everyone’s life when there is a sudden need for money. The immediate choice is generally to use a credit card or to borrow money from friends or family members.
With net-banking now in place and more lenders chasing fewer borrowers, raising money through other sources is now possible at a faster pace.
Gold loans are normally a preferred and cheaper source of the loan, where banks and gold loan companies process the papers fast to give the borrowers the money he or she needs. However, personal loan are now being offered at a faster speed too. There are lenders who advertise that they will disburse the loan within a day. 
Under such circumstances, it is always better to go in for a personal loan rather than using your credit card to meet any emergency need. Firstly, because the personal loan is far cheaper than any credit card loan and secondly because the personal loan can be of a bigger size than what the credit card can offer.
But before one takes a personal loan it is important to have a good CIBIL score. With a CIBIL score of over 750, a person can be choosey in picking up the personal loan with the lowest interest rates. A person with a lower score may still get a personal loan but the interest rates may be higher.
The biggest advantage of a personal loan from the point of view of the borrower is that it is an unsecured loan. The borrower need not pledge or mortgage any of his assets to raise funds.
For an entrepreneur, a personal loan can act as a stop-gap arrangement till he is able to raise money from other sources to meet his urgent business requirements.
Like any loans, personal loans need to be repaid periodically in equated monthly installments (EMI). These loans can run from a short tenure of one year to a four-years loan. These days there are lenders who offer personal loans for a period of seven years also.
While taking a personal loan is easy, it should be taken only in case of emergency. Personal loans, being unsecured are costly. It would be foolish to buy an asset with a personal loan, especially when there are financial products available these days to buy a mobile or any other household equipment.
One should avoid using personal loans to repay loans that are cheaper in cost. But they can be used to repay higher cost loans like credit card bills or something similar.
If one is using personal loan to meet the operating expenses of the house then he or she is falling in a debt trap. One loan will lead to another and before the person understands it, he would have fallen in a debt trap. Rather than using the personal loan as a saviour to come out of the debt trap the person would have fallen in it using personal loans. Personal loans should be used only for intermittent emergencies.

Car Loan Disbursement

Car Loan Disbursement
Is a shortage of ready funds the only thing holding you back from bringing home that latest MUV on display at the nearby showroom? Then maybe it is time you take a look at the various Car Loan products on offer. Gone are the days of saving up for a lifetime to buy a home, a car or even spend on a big wedding. If you have a steady income, a good credit score and repayment history, along with necessary documents, you can always avail of a loan to make those dreams come true.
With a Bank of Baroda Car Loan, you can get financing of up to 90% on the onroad price of the car of your choosing, with an upper limit of Rs 1 crore. Whether you are a salaried professional or a business owner, a car loan is a facility you can make the best of. No additional collateral or security is required, as the car (financed) is hypothecated with the bank until the entire loan amount is repaid.
What is Car Loan Disbursement Process?
The process of getting a Car Loan is relatively simple. The first step is deciding which car it is that you wish to buy, after which you can check for eligibility for a Car Loan at various banks. After going through your options thoroughly, you can go with a Car Loan product that best suits your needs. Checking whether or not you are eligible for the loan reduces the chances of your application being rejected. Nowadays, almost all the information you need about loan products is available on the websites of banks.
The next step is the application, which can be done online or by visiting the nearest bank branch. If you go to the branch to apply for a loan, make sure you have all the necessary documents handy. Then there is the online application option which is hasslefree, quicker and paperless. The application process ends with the submission of documents.
Then comes the step of document verification and loan approval. These days, the car loan approval process has become almost instant. The bank verifies the customer's documents and checks his/her credit score to assess eligibility, following which the loan is approved. Next comes the loan sanctioning and disbursement.
Questions to Ask about Car Loan Disbursement
What are the benefits of a car loan?
Opt for a car loan from Bank of Baroda to benefit from quick processing, minimal documentation and speedy fund disbursal. Loan borrowers are not required to pay foreclosure charges or prepayment penalty, nor do they need to pay advance EMIs.
With higher limits on the Car Loan amount, you can apply for up to Rs 1 crore on new cars. So, if you have always had your eye on a luxury vehicle, our loan can take you one step closer to your dream.
Also, say goodbye to down payment worries, as you can get up to 90% financing on the car's onroad price with Bank of Baroda's auto loan.
Bank Of Baroda offers attractive interest rates on loans to all customers based on their credit scores. Additionally, existing home loan borrowers with a good credit history enjoy a concession of 0.25% on their car loan interest rate
Are there any prepayment charges for Bank of Baroda's auto loans?
You are allowed to prepay your loan without paying any prepayment charges.
What are the documents required to get a Bank of Baroda Car Loan?
The documents required are:

Photo ID with age proof (like, PAN card, passport, driving license)
Signed application form with 3 passportsized photographs

Residence proofs:

Valid passport
Voter id card
Driving license
Postpaid utility bill (gas bill and electricity bill)
Updated passbook or bank account statement
Notarised registered rent agreement
Bank statement for the last six months

If the applicant is a salaried individual

Last 3 months' salary slips
Form 16 or Income Tax Returns

If the applicant is a selfemployed individual

Balance sheet and profit and loss account, computation of income for the last 2 years
Income Tax Returns – last 2 years for Applicants, 26 AS, Traces
Business proof: Gomasta License, Registration Certificate, Service Tax Registration, among others
IT Assessment / Clearance Certificate, Income Tax Challans / TDS Certificate (Form 16A)/Form 26 AS for income declared in ITR

Conclusion
Car Loan disbursement occurs only after your car loan application is approved and you get a sanction letter. Applying for a loan online is more convenient since you need not visit the branch. If you are looking for conveniences and good interest rates on Car Loans, you can start with Bank of Baroda.

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