Education Loan in Delhi

If you are someone looking to pursue your higher studies in India or Abroad and live in Delhi, this article could be of help to you. Students generally require up to 15 Lakhs for studies in India and 45 Lakhs for Studying Abroad. Depending on the lender you choose to finance your education the interest rate ranges from 8.30% to 13.5%.

For Studies in India

The table below specifies the scheme name, loan amount, and the processing fee offered by various banks in Delhi for higher education in India 

For Foreign Studies

The scheme name, loan amount, and processing fee offered by various banks in Delhi for financing higher education being pursued abroad are listed in the table provided below.

For studies in India

The interest rates offered by banks in Delhi for higher education in India start from 8.30% 

For Foreign Studies

The interest rate offered by banks based in Delhi for higher education overseas starts from 10%.

Expenses covered

An education loan funds various academic requirements of a student moving abroad or trying to pursue their education in India. The education loans provided by the lenders in Delhi cover the following expenses. 

• College fees
• The cost of accommodation
• Examination charges 
• Library charges
• Laboratory fees
• Price of Books
• Airfare (For abroad education)
• The premium for the applicant's insurance (For abroad education)

Moratorium Period

In most public banks, private banks, and NBFCs based in the city of Delhi, the moratorium period lasts for a course duration plus 6 months to 1 year depending on the lender providing your loan. The conditions of loan repayment differ in every bank. Public banks do not require you to pay simple interest during the moratorium period. In private banks and NBFCs compound interest is charged during the moratorium period. Most NBFCs also provide an option of partial interest payment during the moratorium period. 

Loan Margin

The loan margin charged for an education loan is the amount that has to be paid by the student or the applicant in order to avail of the loan. Generally, the loan margin in public banks is around 10% and 5% to 10% in private banks respectively. 

For example, if the loan margin charged by a bank is around 10% then and the loan amount is 50 Lakhs, then the student would have to arrange 5 Lakhs in order for the loan to get sanctioned.

Collateral Margin

The collateral margin is calculated in the case of a secured or collateralized loan. The collateral margin is the amount calculated on the basis of the collateral provided as security. In cases where the student is unable to pay back the loan amount, the bank reclaims the amount by utilizing the property or collateral provided for the secured loan.

The paperwork or the document checklist required to get an education loan in Delhi is mentioned below. 

Collateral documents required for a secured education loan in Delhi 

If you are planning to go for a secured loan, you would also be required to provide some collateral documents for the property you are providing for the said loan. The collateral documents required for an education loan in Delhi are mentioned below. 

1. The title deed of the pledged property is required.

2. A registered will, sale contract, or gift deed is required.

3. The original receipt for the registration of the aforementioned agreement is needed.

4. A letter of allocation from the local government or an approved government agency, such as DDA is required.

5. A 30-year-old document, such as an EC or a chain of sale deeds, that establishes the title of the property is needed. This document shows a record of who acquired the property in the 30 years prior. If the property has been held for more than 30 years, the preceding sale paperwork will suffice.

6. Current property tax and power bills from the same address are required.

Acceptable collaterals in Delhi for education loans

For a secured education there are a few conditions and limitations to the acceptable collateral, Below mentioned is the list of collateral generally accepted in Delhi for secured education loans. 

1. A house, flat, or non-agricultural land with defined boundaries is needed.
2. Properties used for commercial purposes can be pledged.
3. Properties used for agricultural purposes can be used. 
4. Fixed deposits, insurance policies, and government bonds are also accepted.

  Note

• Properties for which power of attorney is required cannot be considered for loans.
• Properties or homes on a lease cannot be accepted as collateral for loans. 
• For DDA apartments, a conveyance deed and an allotment letter from DDA are required.
• Properties located within Lal Dora (Red Line) are not accepted.

When banks or lenders have been directly approached for an education loan, the students are met with rejection. Below mentioned are a few of the specific reasons students face rejection for an education loan in Delhi. 

• Poor CIBIL scores: Banks have different minimum requirements for CIBIL scores, but generally, a score of 685 or higher is considered good. However, the State Bank of India (SBI) has a lower requirement, accepting scores as low as 591. If the co-applicants score falls short of the bank's requirements, the loan application will likely be denied.
• Poor academic scores: When applying for an education loan, having poor academic performance in the past can negatively impact the chances of getting the loan approved. Banks and financial institutions may view this as an indication of an individual's ability to successfully complete their education, and as a result, may be less likely to approve the loan.
• Chosen country for higher studies: Banks generally do not accept third-world countries as a destination for higher education. This may be due to concerns about the quality of education, or the ability to secure employment after graduation. It is important for individuals to research the lending institutions' criteria and policies regarding acceptable countries of study before applying for an education loan.
• Chosen course for higher studies: Banks tend to favor students who have chosen to pursue higher education in fields related to science, technology, engineering, and mathematics (STEM) over those studying in other areas. This is because individuals who have studied in these fields are considered to have a higher likelihood of obtaining employment in the industry.
• Insufficient documentation: Without the proper documentation banks cannot start your abroad education loan process. Hence, proper documentation and income proofs are required for an education loan to study overseas. 

Direct engagement with lenders - You can reach out to the lender directly by obtaining the contact number of the executive handling your case from the lender's team.
Technologically advanced - WeMakeScholars allows you to easily apply for, track, and manage your education loan from the convenience of your own home throughout the entire process.
The cashback offered -   When you apply for your study abroad education loan through WeMakeScholars, you will receive a cashback of up to INR 3000 for multiple disbursements.
Negotiation - The WMS team will strive to secure the best return on investment for you by negotiating with lenders on your behalf, while also ensuring that you are charged a fair price for the entire process, including legal fees and other expenses.

An example of your amortization plan could be if you obtained a 55.5 lakhs unsecured education loan from Delhi at an interest rate of 11.5% and with a 6-month grace period and a 10-year repayment period.

• Monthly EMI: 94,379
• Total payment: 1,13,25,489
• Total payable interest: 57,75,489

Padho Pardesh Scheme

Eligibility:

• The student being considered for the scholarship should belong to a minority faith group, such as Muslim, Christian, Sikh, Buddhist, Jain, or Zoroastrian, and has a yearly household income of fewer than 600,000 rupees.

Note: The Padho Pardesh Scheme has been terminated on April 1, 2022. However, individuals who were already benefiting from the scheme as of March 31, 2022, will continue to receive subsidies on the interest of their loans during the loan's repayment period and any agreed-upon period of deferment.

Central Scheme for Interest Subsidy for Economically Weaker Sections

Eligibility:

• The student being considered for the scholarship should have a yearly household income of fewer than 450,000 rupees.

Dr. Ambedkar Central Sector Scheme

Eligibility:

• The student being considered for the scholarship should belong from a financially disadvantaged background (EBC), and the total yearly income of their household is less than 800,000 rupees.
• The person being considered for the position is from the Other Backward Class (OBC), and the annual income of their household is less than 800,000 rupees.

There are many reputable institutions in Delhi that offer a wide range of courses, including engineering, medicine, and arts. Some of the top institutions in the area include:

• Indian Institute of Technology (IIT), Delhi
• All India Institute of Medical Sciences (AIIMS)
• Jawaharlal Nehru University (JNU)
• Delhi University (DU)
• Indian Institute of Management (IIM), Delhi
• Indian Institute of Foreign Trade (IIFT), Delhi
• NLU Delhi
• Amity University
• IIIT Delhi
• ILI Delhi

These institutions are known for their excellent academic programs, highly qualified faculty, and state-of-the-art facilities. They are often considered among the best in the country and attract students from all over India and abroad. They offer a wide range of undergraduate, postgraduate, and doctoral programs in various disciplines. These institutions are also known for their research work and have produced some of the most renowned scholars in the country.

This video includes topics such as the qualifications needed, the different kinds of loans available, how much can be borrowed, the interest rates and the necessary paperwork for the application process. Additionally, this video covers the steps involved in choosing a lender, as well as exploring the government initiatives related to education loans. Watch this video to get a to know the A to Z of getting an abroad education loan