In this fast-growing and developing world, the day to day health and educational expense is increasing at a tremendous rate. Most importantly the educational expenses are increasing at a very fast rate. All the specified courses have really gone out of hands. According to various studies, the educational cost increase at a minimum rate of 15% per annum. The tentative cost of an MBA has seen an increase of more than 15 lakhs in these fifteen years.
Even if parents start to save money on a regular basis. The students have to face a shortfall of funds for pursuing a course.
The educational loan provides a pretty much good opportunity and benefits in these cases.
Today we are going to list ten reasons why you should go for an educational loan and in what ways it can benefit you.
Expensive Education courses
Due to expensive educational courses and lack of funds, many students with high potential tend to go for other cheaper alternative courses which often may not lead to the best result and a poor future. Even after saving Penny over decades, it is difficult for parents to afford the luxurious courses.
The educational loans can really help to solve this problem for needy people.
Why regret later, when you can apply for an educational loan now!
Cost Coverage
Educational loan not only covers your college fees but it also includes the related expenses such as accommodation charge, exam and many other Miscellaneous charges. So, if you are worried about not having enough bucks to get settled in the new city for pursuing the new and expensive course. The educational loan has shorted it out for you.
All the expenses related to your education will be overseen by the education loan.
Study Abroad
If you want to study abroad and don’t have enough resources to get there, it can become easy for you as education loans are available not only for the students studying in our own country but also for the students who want to get their education overseas. The interest rate and maximum amount of loans offered to students of India and abroad differ from bank to bank.
Variety of Courses
The educational loan covers a variety of courses from every field. The loan can be taken for full-time courses, part-time courses, and vocational courses. Anyone can take an education loan at any point in their educational life. Be it for graduation, post-graduation, diploma courses in any field ( management, engineering, business courses, medical, architecture, designing, etc)
Moderate Intrest Rate
The interest rate charged on educational loans is a subsequent amount and not very high. The rate of interest of SBI for borrowing up to 7.5 lakh is 10.25% while for above 7.5 lakhs it is 10.50%.
Many other concessions are also provided by the bank on educational loans to girls.
The educational loan can be treated as a better option as compared to another form of informal loans and advances.
Easy Repayment
The repayment of the loan is done after the course is completed. Once the student has completed the course for which the education loan was sanctioned, the student can easily repay the amount in installments. Some bank also provides relaxation period of 6 months after the completion of courses. During the course period, the bank charge interest. It reduces the burden of students of future repayment.
Reduction under IT Act
The income tax law also provides a great advantage for the educational loan taker. According to the IT Act section 80(E), the Reduction of the entire interest amount from the taxable income is allowed for a maximum period of 8 years. But, there is no provision in the Income Tax Act for the principal amount.
It saves you from giving income tax for the amount of interest.
Builds up Credit Score
The most important benefit that Educational loan provides is it build up your credit score.
If you repay your loan at a time without any dues. your Credit score will enhance and you could easily apply for more loans in your life like home loan, personal loan, etc
The educational loan would be basically the first loan you would ever take.so, it can enhance your credibility for the future.
Taking an educational loan has a lot of advantages from a tax benefit to easy access, from financial support to low-interest rates, From easy repayment options to build up your credibility.
If you are quite a champ in your particular field but lack of resources is restricting you when applying for an educational loan is a better option. It does not take a long time and a lot of collateral. Just a few nominees and paperwork and you are good to go.
Educational loan simplifies a lot of things for students and is a better option for students out there who are willing to go for expensive courses but couldn’t apply for it due to shortfall of money.
