Typically, education loans are offered by all banks and financial institutions. This is an essential for many aspiring students in our country, fishing for finances and fly afar. An education loan can get easily sanctioned, basis the relevant educational documents you submit in the pursuing institution.
Let’s quickly underline the tangible benefits of an education loan:
• Low Interest Rate on Loans: The rate of interest on education loans is relatively lower than personal loans. Many subsided education personal loans are available in the country. If you qualify for an education loan, you get a more competitive rate of interest.
• Charge up your education objectives: It helps you to achieve your education goals at the best. It provides quick money to meet your education goals including fees, processing, moving, miscellaneous expenses like books, laptop, etc. So, using education loans you can charge up your education objectives.
• No urgency for immediate repayment: No need to start immediate repayment. An education loan can be repaid after your course finishes.
• Smooth processing: The documentation process for an education loan is quite simple. With instant personal loans, it is very easy to have an online education personal loan at the earliest hour possible. All documents are uploaded online to start and process the application for education loan.
• Yields Tax Advantages: Education Loan yields tax benefits to its customers and push them for higher savings at once. This brings down the overall cost of the loan.
• Subsidies on the interest component: Under a few schemes, the Government of India bestows upon a few subsidies. This is affixed on the interest component of the education personal loan. This motivates aspiring students to dream big and bear the burden wholly by themselves.
Time for a few disadvantages of an education personal loan:
• Over & above cost of an education loan- When you choose to withdraw, the bank/financial institution charges a fee. The cancellation is accompanied by a few other payments and penalties.
• Loan restricted to education- If you plan to switch your course in the middle of the journey, it can turn out to be a no-no decision. This is owing to the fact that an education loan is sanctioned for a particular course. So when you think to change your course, it may get possible. The education loan has limited use and cannot be used for travelling, housing, food, amenities etc. The education loan can finance hostel, tuition, project costs etc.
• Might Ruin your Credit Score: Delayed repayment of personal loan EMIs can greatly impact your credit score on board. After the education loan is sanctioned, it comes as a responsibility to find an immediate job. If the loan installments cannot be managed, it can further dent your credit score for worse. This is in addition to struggling with your repayments and more.
Although, it is no rocket science to apply for an education loan. But if at all you don’t have it sanctioned, then opt for a personal loan. A personal loan is sufficiently versatile to be used for tuition fees, accommodation, books and other education expenses.
The final decision lies with you. If you choose a personal loan, then all your extra expenses will be done away with. Though, the repayment gets immediately effected. With an education loan, there’s an ease of repayment after you find a job and lower interest rates.