Who Can Be a Co applicant for Education Loan?
Co-applicants play a very important role in the education loan process. This is especially true in the case of unsecured education loans. NBFCs and private banks scrutinize the education loan co applicant profile thoroughly before approving any application for an education loan without collateral. However, were you aware that it is possible to name retired individuals as co applicant for education loan for a government bank education loan? This article is going to shed some light on this very aspect of the education loan process. The Loanflix Inshorts episode on this very topic is embedded below.
What are the requirements of a co applicant for education loan in Government banks?
One of the most pertinent questions asked by students before applying for an abroad education loan is whether it is possible to name individuals without a steady income as co applicant for education loan. This is absolutely applicable only to government bank education loans. A government bank education loan is lent on the basis of collateral security.
As long as the asset being pledged as collateral fulfills all the eligibility criteria set by banks, government banks allow individuals having no particular income source also as co applicant for education loan. One of the biggest advantages of secured education loan is that the education loan co applicant requirements set by most of the government banks are not as rigid as those set by NBFCs and private banks for unsecured loans.
So, if both your parents do not have a stable job, are retired, in the farming industry or are not having a stable income profile, you can still name them as the co applicant for education loan with collateral in government banks. Again, you need to possess the right kind of asset to be pledged as collateral.
Education Loan Co applicant Profile For Unsecured Education Loans
One of the major reasons why NBFCs and private banks stress on the education loan co applicant profile is that unsecured education loans are not given on the basis of any security.
Lenders grant unsecured education loans solely on the basis of a co-applicant’s financial stability. Also, the repayment period of unsecured education loans begin within a month of the first disbursement.
This repayment period begins in the middle of a student’s course. Since students won’t be employed at this stage, they will be unable to repay their unsecured education loan independently till they finish their course. In such circumstances, education loan co applicants are expected to begin repaying till the end of the course. This is why the profile of a co applicant for education loan is given the utmost importance for unsecured loans. However, there is still a ray of hope.
There are certain private banks which offer education loan without collateral to individuals having work experience of a certain number of years without the need of a co applicant for education loan.
Such loans are entirely lent on the basis of the loan applicant’s financial profile and the chances of employment of their course abroad. For further information regarding this, do get in touch with the financial team of WeMakeScholars.
Note: WeMakeScholars is an organization funded and supported by the Government of India that focuses on International Education finance. We are associated with 10+ public/Pvt banks/ NBFCs in India and help you get the best abroad education loan matching your profile. As this initiative is under the Digital India campaign, it’s at free of cost. The organization has vast experience dealing with students going to various abroad education destinations like the US, Canada, UK, Australia, Germany, Sweden, Italy, China, France among others