SBI Education Loan Takeover

Education loans offer financial support to students to fund their higher education abroad. However, the higher interest rates could be challenging. That’s when loan takeovers come into play. 

State Bank of India has been one of the favourites among students who want to shift their education loans. But when, exactly, does it become reasonable to move their loan? And why are SBI’s takeover rates so low? Let’s break it down.

What is an Education Loan Takeover

• An education loan takeover is nothing but transferring your current education loan from one bank to another. This is done for more benefits, such as a lower interest rate or a longer tenure, etc.

• This will reduce your financial burden by lowering your monthly EMIs and the total interest paid throughout the loan tenure. 

• For example, if you are paying a 12% interest rate at your current bank and SBI is offering you 9.5%. Transferring your loan to SBI can help you save some interest in the long run.

How does the SBI Education Loan Takeover Work?

• SBI allows you to switch your existing education loan from another bank to them. 

• You just apply for a takeover loan, and SBI settles your old lender directly. 

• After that, you’ll begin repaying your loan to SBI, but at their revised interest rate.

This process is perfect for students who have already started repaying, but want to lower the total loan amount.

Why SBI Offers Lower Takeover Interest Rates

SBI has such good takeover rates because:

• The risk profile is lower as the student has already begun to pay EMIs.

• SBI corresponds with government initiatives to make education loans more affordable.

• SBI offers education loans to students at a lower interest rate, making it beneficial for the borrowers.

When Should You Transfer Your Loan to SBI?

• Want to reduce your monthly EMI.

• If your current bank is charging higher interest rates.

• When you want to switch from a private bank to a public bank.

Benefits of choosing SBI for Loan Takeover

Some of the benefits of choosing SBI are:

• Lower Interest Rates: Typically 8 –10% interest rate, depending on your profile.

• Convenient Repayment Period: Generally up to 15 years.

• No Hidden Fees: Terms are clear with no prepayment penalties.

• Tax saving: Interest paid is tax-deductible under Section 80E of the Income Tax Act.

Interest Rates Comparison Across Different Banks

Before concluding to transfer your education loan, it is important for every borrower to compare the SBI takeover rates with other popular banks. Here is a comparison table of SBI takeover rates and other banks.

Processing Fees In SBI

• As lower interest rates are offered by SBI on the education loan takeover, processing fees are also an important aspect.

• SBI usually takes a minimal processing fee of ₹10,000 + GST for takeover loans.

• SBI’s processing fee is lower when compared to that of private banks and NBFCs.

• This reduces the cost of transfer as a whole and makes it worthwhile to lend you money.

Eligibility Criteria for SBI Education Loan Takeover

Before applying for a takeover loan at SBI, you need to make sure that you meet SBI’s eligibility criteria. These are the basic requirements that SBI checks.

1. The minimum loan balance that is required to transfer should not be less than 10 lakh.

2. You need to pledge a property if you are transferring your unsecured education loan from a private bank to SBI.

3. SBI has an unsecured education loan option. You can transfer your unsecured education loan without pledging property. If your university comes under the top 100 listing. 

The rest of the terms remain the same for the remaining banks.

Documents Required for Loan Takeover at SBI

Before applying for a takeover loan at SBI, you will need the following documents to submit. Some of the documents are:

1. Loan Account statement from the existing bank.

2. Sanction letter and repayment schedule from the existing bank.

3. Basic KYC documents of the applicant and co-applicant.

4. Income documents of the co-applicant.

5. Collateral documents.

6. Admission proof, course details of the student.

7. No Objection letter from the existing bank.

Benefits of doing a Loan Takeover through WeMakeScholars

Zero-Processing Fee: In case of loan takeover, WeMakeScholars has taken permission from all the banks for a zero processing fee. This means that when you transfer your loan through WemakeScholars, there will be no processing fee. Whatever, and even if they charge you, it won’t be more than five to ten thousand rupees.

End-to-end support: Usually, when a student studies abroad, they look for an education loan transfer. If they apply through WeMakeScholars, students can talk to our financial officers. If in India, the candidate’s parents can present additional documentation for processing. The parents will also have access to their students' designated financial officer at every step.

Interest rate Negotiation: If you apply through WeMakeScholars for your educational loan takeover, our financial team can talk to the bank. So they can get you a reduction of 0.5% to 1%, which means further less interest for the same amount that we discussed above.

Apart from providing support for education loans, our officers also help you with loan transfers. We have handled nearly 20,000 student loan applications over the past year. With the volume of loan applications we process, no one has more experience in this market than our group.

Conclusion

Choosing SBI for your student loan is a good financial decision. If you want to lower the interest rate and reduce the burden of repayment. With the lower takeover rates, lower processing fees, SBI is one of the best banks for students. WeMakeScholars can make the process even easier by providing professional guidance. So you will get your dream deal easily and confidently.