How to apply for an education loan – a step by step guide
01 Nov 2019
The cost of seeking a quality education is rising every day. Schools and universities charge fees to the tune of several lakhs of rupees, making it impossible for parents to fully fund their child’s education. High costs of education are especially a burden on parents whose children aspire to attend private institutions in India or prestigious universities abroad. In such a situation, the only respite is offered by banks which provide education loans. Such loans cover everything, from tuition fees and cost of books, apparatus etc., to lodging charges, dormitory fees, travel allowance and so on. Let us find out the step-by-step procedure to take education loan.
Step 1 – Filling the application form
Just like with any other loan, the first step is to fill an application form. The application form is a simple form in which you must provide your personal contact details as well as your academic details. Ensure that you provide accurate and truthful information in this form. 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
Step 2 – Interview
The next step in the education loan procedure is the interview round. After considering your application, your bank typically calls you for a personal discussion or an interview. Note that the loan is offered to the student and co-obligation of parents/ guardian and the student is considered as the main loan applicant. You may be asked several questions pertaining to your academic performance, the institute you wish to attend, the course selected by you, future scope of your chosen course and so on. You must be honest and should be able to convince the bank that you are choosing a stream that has the potential to generate good income, thus enabling you to repay the loan.
Step 3 – Documentation
Before the loan is processed you need to prove to the bank that your chosen university has extended an offer of admission. This is the primary document that all banks ask for, even before one begins the actual loan application process. The bank can get in touch with the university to verify your enrolment. If your education loan amount exceeds ₹4,00,000, you would be required to provide some sort of collateral in the form of third party Guarantee if the required loan amount is upto Rs.7,50,000, and if it exceeds 7,50,000 you are required to provide collateral security equivalent to 100 % of the loan amount along with assignment of future income of the student for payment of instalments.
Assignment of future income of the student for payment of instalments is applicable to all Education Loans irrespective of Loan amount.
Step 4 – Loan approval
As per the education loan repayment procedure, banks offer the loan to the student applicant, and since the student cannot repay the loan until the course is completed, the bank considers parents/guardians as co-borrower of the loan. The Bank also verifies the credit history of the Co-borrower/guarantor before sanctioning the loan. Bank offers moratorium period equivalent to the course period plus one year and it is optional for the borrowers to serve the Interest on Education Loan during this moratorium period. Once the loan is approved, the borrowers will receive a Sanction letter from the Bank. Once the Borrowers accept the terms and conditions of sanction, Bank calls them for execution of loan documents and hand over of collateral security papers in original to the Bank if it is required as per terms of Sanction.
Step 5 – Loan disbursal
The final step in the education bank loan procedure is loan disbursal. Banks typically directly disburse the loan to your chosen university by way of Banker’s cheque, Demand draft or SWIFT message as per the location of the chosen University/Institution along with your margin if stipulated in Sanction.
How to Apply for a Car Loan
How to Apply for a Car Loan
That expensive car you have your eyes on is now a possibility more than ever. You can get a loan from banks and other financial institutions to fund it. Not long ago, having a home of your own or a family car used to be considered luxurious most people found themselves unable to afford. But with the variety of loan products on offer these days, one does not have to have unfulfilled dreams anymore.
Are you planning to buy yourself a new ride? You can get up to 90% of the on-road price of the car of your choice financed with a Bank of Baroda Car Loan. Here's how to apply for a car loan
Car Loan Eligibility Criteria
At Bank of Baroda, you can get yourself a car loan to buy a car of your choice. These auto loans are available to all salaried employees, business people, professionals, farmers, corporates (partnership, private limited, public limited and trust), as well as NRIs and PIOs.
The borrower should also be at least 21 years old, while his/her age plus the repayment period should not exceed 70 years.
The documents that you need to keep ready when applying for a Bank of Baroda Home Loan are as follows:
Photo ID with age proof (like, PAN card, passport, driving license)
Signed application form with 3 passport-sized photographs
Bank statement for the last six months
If the applicant is a salaried individual
-3 months' salary slips
-Form 16 or Income Tax Returns
If the applicant is a self-employed individual
-Balance sheet and profit and loss account, computation of income for the last 2 years
-Income Tax Returns of the previous 2 years
-IT Assessment/Clearance Certificate, Income Tax Challans/TDS Certificate (Form 16A)/Form 26 AS for income declared in ITR
How to Apply for Car Loan?
The process is relatively simple and straightforward. Once you have decided upon the model you wish to purchase, look through the various Car Loan options. Bank of Baroda has competitive interest rates on their Car Loan products.
After finalising the bank or lender you wish to go with, you can either head to the bank branch or log on to their website to start the loan application process. To apply for a Car Loan from Bank of Baroda, visit the website. Keep the documents above handy, and also be sure to check your eligibility for the loan
Car Loan Approval Process
In this digital age, the loan approval process has become simpler and quicker, with most banks deciding upon loan applications almost instantly. Once the lender verifies your credit score and a few other things on their end, your loan application will go through, and the process of disbursal begins. In the online mode, the Car Loan fund transfer takes place in a matter of just a few minutes, with a couple of clicks to kickstart things. A car loan is granted based on the customer's credit score, income situation, other debt obligations and repayment history, among other things.
How to buy a house in India? All you need to know.
Buying a house is a dream for a many people in India. However, the process to buy a house is not as simple as looking it up and buying it instantly. There are a lot of factors to consider and a fair bit of due diligence is required on the part of the buyer before the house is bought.
The process of buying a house can be condensed into these steps:
Figure out how much you can afford:
The first step on how to buy a house in India is to decide how much you can afford. Housing loans are extremely popular and easily available which means you can also factor in a loan value while deciding how much you can pay for buying a house. It is also important to take a look at your household budget while deciding this. You need to have enough funds left over for making investments and meeting household expenses since banks auto debit the EMI from your savings account.
Decide the location:
The price of the flat depends a lot on its location and the proximity to major roadways or an airport. Upcoming suburbs outside a major metropolitan city will be cheaper than buying a flat within city limits. However, you must factor in the time taken to commute from your place of work to your residence.
Check the resale values:
Checking the resale value of the flat is extremely important. This depends on a few things such as the builder’s reputation, the locality etc. It is easy to find resale values on different property portals. This especially helps in case you want to move in a few years or are investing for the purpose of investment.
Check your loan eligibility:
Real estate is extremely expensive in India and not many buyers can afford to buy it outright with their savings. This is where a home loan comes in. Most lenders have a home loan eligibility calculator on their website where you can check for your loan eligibility. The loan eligibility does not translate into the final loan amount since that depends on the actual property itself. However, these calculators are a good indicator of how much loan you can expect to get if you apply for it.
Registration and stamp duty:
Registration and stamp duty are costs that are paid over and above the purchase price of the house. These costs differ from state to state in India and each state has a formula for calculating them. It is important to factor these costs since this adds to the expense.
You must decide whether to buy a house through an agent or directly. Agents prove to be helpful while finding buyers and sellers for flats, especially resale flats. However, they also charge a commission from both parties for the sale.
You can either buy a flat in a new construction or buy a resale property. New constructions also have a risk of permissions attached to them. However, new constructions also come with more amenities.
Rental value of property:
If you’re looking to rent out the property, you need to calculate the amount charged as rentals from similar flats in the area. This will help you estimate your monthly earnings. It is better to buy a flat in an area that is conveniently located since such places will always have a demand for rentals.
Once you factor in all these points, you can then add up the total value of the house. How much money to buy a house in India depends majorly on the location of the flat and the city or town, but after considering these points, you can get a fair idea.