In this article I’ll tell you about Education Loans. EVER increasing demand for education loan can be analyzed from the fact that the expenses of Higher education has become unbearable and which has now become a necessity. Due to this many institutions have come forward with a view to provide financial help to students. These institutions provide better opportunities to students to avail the required finances. These finances enable the students to compete their education without any hindrance.
Students even ensure a lucrative future for themselves as many companies are coming up these days which demand qualified students and offer them high positions and handsome salaries and other benefits. Education loans covers a wide variety of expenses. It not only helps in meeting the tuition fees but also the others benefits like hostel fee, expenses of books and all other expenses related to education.
Education loans can be classified into two types known as scheduled loans and unscheduled loans. Education loans imposes no mental stress on borrower, as the borrower can repay it whenever he becomes self reliant to pay back the amount. The student can repay the loan after getting a fixed source of employment.
The only disadvantage is that the rate of interest is much higher as compared to others but it has many advantages like the loan can be obtained easily as it involves no security and more over it can be obtained in minimum time period. Education loans fulfill the requirements of an individual whenever required. Student takes up the responsibility of repaying the loan which also reduces the financial stress of the parents.
The other source of finances can be borrowing the required funds from the borrower. However if the borrower prefers borrowing from the borrower instead of education loans then he can be duped by the borrower. Borrower might acquire education loans at competitive rate of interest and at longer and on long credit terms. However if you are a prospective borrower, then you can bargain the interest rate in comparison with less educated credit borrower.
Types of Education Loans: Education loans are classified into two categories:
- Secured Education Loans
- Unsecured Education Loans
Assets are kept as collateral in secured education loan and the funds are available for long period and more over the rate of interest is lower .The reason behind this advantage is that the lender is free from any kind of risks. Another advantage is that by personal conversation with the buyers rate of interest can be reduced.
However under unsecured loan no asset has to be kept as collateral security. The rate of interest is much higher as compared to secured since no collateral is demanded in this case. The rate of interest is not always higher as they can be obtained from lenders in competitive market. Education loan is considered must today for a student to complete his higher education.
These days there are many sources available for a student to obtain the loan. They have much opportunities available to themselves to acquire the loan. To achieve a prospective future there are two main sources from where education loans can be acquired to obtain the financial assistance which will enable to furnish a beautiful future for yourself.
The two main sources are discussed bellow:
- Government Lenders
- Private Lenders
Since loans of subsidized nature are provided by the government, so students generally prefer to finance from government lenders. Subsidized funds are managed and controlled by the concerned government and the ministry of finance in rest of the countries and they are available at cheaper rates.
However, private lenders charge rate of interest based on education loans. There is a Federalized program of education prevailing under this which is very useful as it offers reasonable and flexible opportunities related to educational loans. Students are charged very low rate of interest under this program which also offers the opportunity of repaying the amount in the long run.
How to apply for Education loans?
Education loan can be obtained through online sources. This is considered as the most useful methods as loan can be obtained in very short duration of time as just by sitting at home all the required information can be grabbed. Details of different lenders can be examined by sitting at home and the best decision can be taken thereafter.
There are some requisites necessary to be followed for obtaining education loan. Some important requisites are as follows:
- The minimum age required by student to obtain loan is eighteen years.
- Student wishing to apply for a private loan then must be accompanied by a co-signer.
- Credit worthiness of the student may be sometimes required.
- Sometimes loans are offered to the student on behalf of some property of the student kept as collateral.
Another advantage involved is that even the amount of interest can be repaid by the student as and when considered convenient by him. Interest can be repaid by the student while pursuing college education which reduces higher amount of repayment later on.
However there is no bounding. There are many things which should be kept in mind by the borrower before borrowing any kind of loan like the quotes of different lenders, rate of interest involved, time period offered. All this information can be acquired online by knowing different websites. These education loans are of ample help to the students planning to pursue higher education.
Online searching and applying for loans offers many advantages. All the needful can be done much soundly and quickly. Appropriate lender can be analyzed must faster which helps in taking prospective decisions and applying by sitting at home all work can be done. It helps in utilizing the time which is wasted by visiting the office of the lenders. There is no unnecessary confusion and waste of time between the lender and the borrower as any sought of information can be searched through net.
Therefore, it can be concluded that there are many benefits in going for education loans provided you grab the best opportunity available at the right place. Remember while catching fishes in the sea you could also have to face crocodiles.