Solving Common Issues with Interest Rates, Loan Sanction & Disbursement

After getting an education loan sanctioned, many students stay under the impression that an education loan sanction is the end of the road for the entire loan process. But did you know how many candidates face several issues even after the loan is sanctioned? 

This article will cover all the issues faced by students after their loan is sanctioned like disbursement issues, interest rate issues, repayment issues, etc, and will give you a brief insight on how WeMakeScholars can help you circumvent these education loan sanction issues. 

You can also watch our 8th episode of the Loanflix series, where we've covered the same education loan post-sanctioned issues-

What is a Sanction for an Education Loan?

An education loan sanction means the lender has approved your education loan and given you a sanction letter. It is a letter issued by the bank stating that your loan application has been approved. It contains all the details about the loan, including the loan amount, the interest rate, the repayment tenure, and other terms and conditions of the loan. 

• You can submit it to the university as proof that your loan has been approved and that you can fund your education.
• The validity of a sanction letter is generally 6 months.
• This means you have to take your first disbursement within 6 months of receiving a sanction letter.

What happens if your sanction letter expires?

If your sanction letter has expired before taking a disbursement, you can no longer access the loan. Your loan will not be valid anymore and you will need to reapply from the start. The new loan terms, such as the interest rate, tenure, and loan amount, can change from the previous offer according to the lender and the market conditions.

Now, let’s understand the sanction issues you may face with an education loan after receiving the sanction letter and how to overcome them.

Issues faced by students after their loan is sanctioned

These are the various issues you can face in an education loan after the sanction and their solutions

1. Interest Rate Issues

   Students often encounter an issue of a sudden increase in their interest rate when they take an education loan from a private lender. This is because education loans from most lenders have floating interest rates. This means your interest rate fluctuates based on market conditions. Consequently, your monthly EMIs will increase, which will result in a higher total loan repayment amount. 

   Are you worried about being stuck in such a situation? Don’t worry, we have a solution for you. Our team at WeMakeScholars is here to pull you out of the bog. When you go via WeMakeScholars, our team can bring down your interest rate to the market value at that moment. Our dedicated Education Loan Transfer team has the expertise to help you bring down your interest rate to resolve your issues. 

2. Disbursement Issues 

   Disbursement is the transfer of the approved loan amount from the lender to the university or student's account to cover the educational expenses.

   Many times, students who directly approach banks for education loans later face various Disbursement issues, including the bank not disbursing the loan amount, delay in the disbursement of loans, etc. This causes serious problems for students. This happens mostly because not every official at every bank branch is aware of the disbursement and pre-visa disbursement requirements and policies.

   Now, when you go via WeMakeScholars, we are partnered with more than 15 public and private lenders, so our team knows how to talk and negotiate with the bank on your behalf to resolve the Disbursement issues you can face in your Education Loan in no time.

3. Repayment Issues and Queries  

   Complications in the Education Loan Repayment terms are one of the major education loan sanction issues. The significant repayment issue faced by the students is EMI not being deducted even after the completion of the moratorium period in education loans. It is a huge concern as it affects the credit score of all the people involved in the loan.   If an EMI is not deducted on time, it will be considered a missed payment, leading to a penalty.

   In a few cases, students who have applied directly to the bank, after facing issues approached WeMakeScholars but unfortunately, we are not authorized to speak on behalf of the student if they have not applied via us. To avoid getting into such issues, contact our financial team by requesting a callback.

4. Unnecessary charges put up by the bank

• During the education loan process, students come across various charges including processing fees, legal charges, and other charges. Banks can charge various hidden charges after your loan is sanctioned.
• Students must keep track of their loan account statements and understand how they are paying the loan amount.
• Students face issues where unnecessary charges have been put up by the bank, and they struggle to connect with their respective bank lenders. 

You can avoid these charges by applying through WeMakeScholars, as we offer a completely transparent education loan process. You will not come across any hidden, unnecessary charges in the entire loan process. A dedicated financial officer will guide you throughout your loan process. You can expect any sort of issue to be resolved by our team during your entire repayment period. We are here to help! Simply Request a Callback on our website, and one of our expert financial officers will get to you at the earliest.

Conclusion

These are the common education loan sanction issues faced by the students after their loan is sanctioned. So, before directly approaching bank staff to take an education loan, ponder upon the fact of who will help you when such issues arise after your sanction or when you are abroad.