Did you know that many students aspiring to study abroad may not have assets to offer as collateral for an education loan? However, they can still pursue their dreams by seeking education loans that are without collateral. Many different lenders, including private banks, NBFCs, and others, offer non collateral education loans for studying abroad. This blog provides comprehensive information on this topic.
Eligibility for abroad education loan without collateral
To be eligible for an abroad education loan without collateral, certain criteria must be met. While these criteria may vary among different lenders, common factors include –
- Co-applicant requirements, which involve a co-applicant with a good credit score (often referred to as CIBIL), meeting specific income requirements, and satisfying the lender’s criteria.
- Test results, where performance in English proficiency and standardized exams like IELTS, TOEFL, GRE, SAT, and others should meet or exceed the benchmarks set by the lender.
- Academic performance is crucial, as non collateral education loans place a strong emphasis on your past academic achievements to predict your potential future earnings.
- Selection of a country, university, and course that aligns with the lender’s approved list for an education loan without collateral.
Lenders for abroad education loan without collateral
Lenders offering non collateral education loans include not only banks but also NBFCs and international lenders. Therefore answering the main question – Which bank gives education loan without collateral for abroad? Here is a listing of some of these lenders, along with their maximum loan amounts and interest rates –
- UBI – Maximum loan amount of up to 40 Lakh INR with an interest range between 9.80% – 11.30%.
- Axis Bank – Maximum loan amount of up to 50 Lakh INR with an interest range between 11.00% – 11.50%.
- MPOWER Financing – Maximum loan amount of up to 100,000 USD with an interest of 12.99% for graduate programs and 13.99% for undergraduate programs.
- ICICI Bank – Maximum loan amount of up to 50 Lakh INR with an interest range between 10.85% – 12.50%.
- HDFC Credila – Maximum loan amount of up to 65 Lakh INR with an interest range between 11.25% – 13.00%.
- SBI – Maximum loan amount of up to 7.5 Lakh INR with an interest range between 10.65% – 11.50%.
- Prodigy Finance – It can cover up to 100% of the cost of your abroad education with an interest rate that ranges between 12.00% – 14.00%.
- IDFC FIRST Bank – Maximum loan amount of up to 50 Lakh INR with an interest range between 11.50% – 13.25%.
- InCred – Maximum loan amount of up to 60 Lakh INR with an interest range between 12.00% – 14.00%.
- Avanse – Maximum loan amount of up to 75 Lakh INR with an interest range between 12.50% – 13.50%.
- Auxilo – Maximum loan amount of up to 65 Lakh INR with an interest range between 11.25% – 14.00%.
Required Documents for abroad education loan without collateral
Obtaining an abroad education loan without collateral typically requires several documents, including those for the applicant and co-applicant. These documents include proof of identity, address, income, academic records, and more.
Applicant document for non collateral education loan
- Passport
- Loan application form
- Address proof – a recent copy of the telephone bill, electricity bill, or water bill
- Statement of expenses – the entire cost of education
- Proof of admission – you can submit a conditional offer of admission as well
- Past academic record – 10th, 12th, undergraduate mark sheet, test scores of entrance tests like GRE, TOEFL, IELTS, etc.
- Identity proof – PAN Card, Passport, Voter ID card
- Loan account statement of one year, if there are any previous loans taken from any lender
- Passport-size photographs
Co-applicant documents for non collateral education loan
- Identity proof
- Address proof
- Income proof – the documents for the same will differ depending on the type of employment, such as self-employed or salaried.
If self-employed –
- Last 2 years IT returns
- TDS Certificate
- Business address proof
- Bank account statement for the last 6 months
- Certificate of Qualification
If salaried –
- Salary slips of last 3 months
- Copy of Form 16 for the last 2 years or copy of IT Returns for the last 2 years.
- Bank account statement for the last 6 months.
How to Apply for an abroad education loan?
To initiate the process of obtaining an education loan without collateral, follow these steps:
- Check Eligibility: Start by visiting GyanDhan’s website or using their eligibility form to determine if you qualify for a non collateral education loan for studying abroad. Eligibility depends on your academic background, admission to a recognized foreign institution, and your financial situation.
- Apply and Get Assistance: An Education Loan Counselor (ELC) from GyanDhan will guide you through the application process and provide you with a personalized checklist. After submitting your application, the system will connect you with two lenders that match your situation.
- Submit and Verify Documents: Gather and provide the required paperwork, which includes your academic and financial records. Lenders will review your application, examining your admission details and financial information.
- Get Loan Approval: Once the lender approves your application, you will receive notice of the approved loan amount. If you agree with the terms, you can proceed by signing the agreement, and the necessary funds will be provided.
Benefits of abroad education loan without collateral
Opting for a non collateral education loan for studying abroad comes with several advantages, including streamlined paperwork, the freedom to choose your educational institution, the option of a co-applicant instead of collateral, and extensive coverage of study expenses.
- Streamlined paperwork – With non collateral loans, the documentation process is much simpler compared to secured loans. You’ll only need to provide easily manageable documents.
- Freedom to choose your institution – While many lenders have specific lists of universities, colleges, or courses they support with education loans, several now offer non collateral education loans for studying abroad with a wide range of options. This means you can study wherever you prefer.
- Co-Applicant as a viable option – If you have a suitable co-applicant willing to assist you, you will not have to worry about providing collateral. Your co-applicant should have a good credit history that meets the lender’s requirements. A strong co-applicant can serve as an alternative to collateral.
- Extensive coverage of study expenses – non collateral education loans often provide substantial amounts that cover all your overseas study expenses. Most of your costs are taken care of if your application profile is strong and your loan amount falls within the lender’s maximum limit.
If you ever have questions or uncertainties, do not hesitate to contact GyanDhan. They are available to assist you in understanding the loan process and finding the ideal lender for your specific circumstances. Simply check your loan eligibility with them, and they will guide you through each step of the process.
