How to Get Student Loan

Higher education brings a stepping stone to more lucrative careers. Yet, expenses like fees, accommodation and books, etc. can be a problem. If after class 12 you are thinking of further studies, getting a Student Loan will support your studies, and at the same time, you will not burden your family financially.

This guide is a complete resource for you if you want to get a Student Loan after 12th. You will find information about eligibility criteria, the different types and features of the loans, step-by-step application, necessary documents, and in addition, we have answered some of the FAQ’s as well.

What are student loans after 12th?

Student Loan basically means banks and other financial institutions giving financial help to students through loans to enable the students to complete higher education. Loan amount can be used for paying tuition fees, hostel charges books examination fees laptops study materials etc. in fact any education related expenses.

Those students who after passing 12th examination have obtained seats in a recognized college or university can take loan for funding their undergraduate courses in India or abroad.

Eligibility Criteria

Students should first get familiar with the basic eligibility conditions before making an application. Even though the precise requirements may differ from one lender to another, the usual factors are:

• The applicant must be an Indian citizen.
• The student should have passed Class 12 from a recognized board.
• Candidate’s confirmation of getting admission in a recognized college, university or professional institution.
• Generally, a parent or guardian is required to be the co-applicant.
• Both the student’s academic record and the co-applicant’s financial situation might be taken into account for the approval.
• According to the loan amount, some lenders might request collateral.

It is highly recommended that you fulfill these requirements to have a Student Loan sanctioned without any undue delay.

Must Read Article for Students: How to Start Trading as a Student

Types of Education Loans

Knowing the eligibility requirements is just the first step. Next, you should find out about the different types of education loans that students going to class 12 can get. Every student has a different financial condition. Some families may be able to offer collateral, while others may want a loan without collateral. That is how lenders usually come up with two types of education loans.

Secured Education Loan (With Collateral)

When you take a secured education loan, you or your co-applicant need to give an asset like property, fixed deposits or insurance policies as security.

One of the greatest benefits is that you are normally able to borrow a larger sum of money at a lower rate of interest. If a student is looking for a course with very high fees in India or abroad, then this is a very good option.

Unsecured Education Loan (Without Collateral)

With an unsecured education loan, you don’t have to give any collateral. The lender will still look at the co-applicant’s income, credit record, and the capacity to repay the loan before giving the approval. This is a very good choice for students who do not have any assets that they can pledge. Usually, the loan approval is faster, although the interest rate might be a little more.

It is very important that before you select a loan, you do a thorough comparison of the interest rates, terms of repayment and eligibility requirements of various lenders to pick the one that not only supports you in your education but is also financially feasible.

Process to Get an Educational Loan After 12th

Taking a student loan is not only easy but also the best way to fund your education. The only thing you should do is keep all the necessary documents handy.

Step 1: Choose Your Course and College

make sure that you acquire an admission letter from a recognized educational institution. This letter is what many lenders want before they can proceed with the loan application.

Step 2: Compare Loan Options

Don’t just get a student loan from any bank. Before you decide, compare their interest rates, repayment periods, processing fees, and moratorium benefits.

Step 3: Check Eligibility

Apart from checking the educational institution’s requirements, make sure that both the applicant (student) and co-applicant (parents/guardians) meet the bank’s requirements.

Step 4: Collect Required Documents

Get ready with all your academic identity admission, and income documents so delays in the verification process don’t happen.

Step 5: Submit the Application

You can either fill out an online application form or visit the nearest branch of the bank. And the admission proof, submit all the necessary documents.

Step 6: Verification and Approval

Once the bank has received your documents, they will right away start verifying them, checking the co-applicant’s financial status, and proceed for loan approval.

Step 7: Loan Disbursement

Usually, after the loan is approved, the financial institution disburses the loan amount directly to the educational institution as per the fee structure.

Documents Required

The following documents are commonly required while applying:

• Completed loan application form
• Aadhaar Card, PAN Card, or Passport
• Passport-size photographs
• Class 10 and Class 12 mark sheets
• Admission letter from the college or university
• Fee structure issued by the institution
• Address proof of student and co-applicant
• Income proof of parent or guardian
• Bank account statements
• Salary slips or Income Tax Returns of the co-applicant
• Collateral documents (if applicable)

Having these documents ready can help speed up the approval process for your Student Loan.

Final Thoughts

Financial barriers should never deter you from pursuing higher education. If you plan ahead, explore different lenders, and provide accurate documentation, getting a Student Loan after Class 12 is not so difficult. Shopping around for interest rates, repayment methods, and loan conditions is always a good idea before you decide on the one that suits your academic and financial requirements the best.

Frequently Asked Questions

Can I get a Student Loan immediately after Class 12?

Yes. You can apply for a student loan as soon as you finish Class 12 if you have secured admission in a recognized undergraduate program.

Is a co-applicant mandatory?

Most of the time banks make it a condition that the co-applicant of a Student Loan should be a parent, guardian or spouse.

Does the loan cover living expenses?

Yes. Besides tuition fees, many education loans also cover hostel fees, books, laptop, travel expenses, exam fees and other study-related expenses.

When does repayment begin?

Typically, lenders give a moratorium period during which the repayment does not start. Repayment will start after finishing the course, and there will be a grace period as per the bank’s policy.

Can I apply for a loan to study abroad?

Yes. Many banks and financial institutions provide education loans for undergraduate courses at the international universities which are recognized.