Education Loans in Mumbai

Students hailing from Mumbai have got numerous education loan lender options in Mumbai to fund their education in top educational institutions in Mumbai or anywhere in India or even abroad. Students from Mumbai can apply to get an education loan of up to 2 Cr, depending on other parameters of their loan file.

The interest rate for education loans in Mumbai starts from 8.5% and can go up to 13%, depending on their course, country, and co-applicant analysis. There are public & private banks along with NBFCs to fund students to study in India or abroad, the further details are given below:

All major banks in India have their presence to offer student loans in Mumbai. Here are the top banks.

For studies in India

For Foreign studies

You should choose WeMakeScholars to apply for your student education loan in Mumbai, as we are funded and supported by the IT Ministry, Government of India, and have expertise in dealing with thousands of loan files every day.

Reach out to your financial officer at WeMakeScholars to check your loan eligibility and start your loan process.

The education loan interest rate in Mumbai for different banks are given in the table below, based on loans to study in India and abroad, along with special concessions for students processing their loans with WeMakeScholars

For studies in India

For Foreign studies

Covered Expenses

Students availing an education loan from banks or NBFCs in Mumbai are covered for the following expenses

• Course or Tuition Fees
• Hostel or accommodation fees
• Cost of stationeries and books
• Traveling cost (air tickets, if the student is going abroad)
• Mess and food expenses
• Cost of uniform, projects, and thesis work
• Laptop or computer cost

The banks also commit to paying for any other expenses incurred during the course or related to the course of study.

Moratorium Period

The moratorium period is the duration of time that starts immediately after the disbursement of loan. It usually lasts for the course duration plus upto 6 months or 1 year after completion of the course, depending on the bank policy.

Loan Margin

Applicants do not get the entire asked loan amount as an education loan, there is a loan margin in every bank. It is a percentage-wise amount of the asked education loan which the applicant will have to arrange on their own, in order to get the remaining amount as an education loan. The loan margin is to check the loan repaying capacity of the applicant.

Generally,

• The loan margin to study in India is 5% of the loan amount
• To study abroad loan margin is 15% of the loan amount

However, the actual loan margin depends on the type of loan that you are applying for and the loan scheme under which you are applying.

Collateral Margin

Depending on the type of collateral, banks have different percentages set for each type of collateral on which it provides education loans. 

Some banks allow up to 100% of the value of immovable properties when determining the loan amount, while others accept up to 100% of the value of liquid assets. The proportion, however, is dependent on the kind of collateral. Contact your financial officer at WeMakeScholars to find out the precise loan amount you qualify for based on your collateral security.

Lenders have very specific documents requirements to offer student education loan in Mumbai, which include the following documents:

Section 1: Application form & Photograph

Submit the filled education loan application form, hard copy of the loan application form filled out online on the WeMakeScholars website is also acceptable. Also, carry 2 passport-size photographs of the applicant.

Section 2: Basic documents of applicant, co-applicant, and/or guarantor

1. Identification proof

• Aadhar card 
• PAN Card
• Passport if the applicant is going to study abroad

2. Proof of residence (in case permanent address and present address is same then, student will have to provide 2 different documents)

• Electricity Bill
• Aadhaar card
• Telephone Bill
• Bank passbook statement
• Voter ID Card
• Ration card

3. Co-applicant documents

• If Salaried- bank statement of last 6 months
• If Self-employed- business transactions of last 1 year

4. Asset and Liability statements approved by the bank employees

Section 3: Academic documents of the applicant

• Admission proof of student in the eligible course
• Fees structure as provided by the university with the payment deadline
• Scorecard of GMAT/ IELTS/ GRE 
• School and college mark sheets from class 10th along with certificates

Section 4: Financial co-applicants income proof documents

If Salaried

• Last 2 years' details of Form 16
• Salary slips of last 3 months 
• Applicant’s office ID card
• Last 2 years ITRs

If Self-employed

• Last 3 years ITRs
• Profit and loss statement in the balance sheet of the last 3 years  
• Business address proof

Section 5: Other Documents

• Co-applicant declaring that all other expenses will be taken care of by them
• Joint affidavit in the bank’s standard format from the student and co-applicant’s side

Section 6: Additional docs (if applicable)

• Payment receipts made in the name of the university
• Statement of any pending loans in the last 1 year
• Gap certificate on Rs 100 stamp paper explaining the reason for a break in academics

Acceptable collaterals in Mumbai for education loans 

1. House, Flat, in residential areas with all required documents
2. Commercial properties 
3. FD, Insurance policy, Government bonds 

To apply for a collateralized education loan in Mumbai, you will need to produce all the necessary collateral documents along with the below mentioned collateral documents if you are pledging immovable property as collateral:

• A no-objection certificate from the builder or society management in the bank’s given format
• Receipts of all payments made to the builder or seller
• Share certificate if in case the property is a resale property
• Conveyance deed of the property
• Confirmation of POA by the builder
• If the property is very old, then a structural analysis report will be required by public banks
• Commencement certificate in case of new property
• Certificate copy of board resolution or power of attorney from builder is required

The above-mentioned collateral documents are required for collateralized education loans in Mumbai. Also, they vary from state to state. Talk to your financial officer who will provide you with an accurate list of required documents.

Banks are very specific in terms of their policies and conditions to offer student loans, your loan might get rejected if there is fault in any one document. Here are some common reasons for education loan rejection in Mumbai:

• Chawl properties cannot be pledged as collateral for education loan
• Properties under pagdi system are not acceptable as collateral
• Properties given by the government to slum people for their rehabilitation cannot be pledged
• If the MAHADA property is less than 10 years old, then it is not acceptable
• Flats or houses in Mumbai those do not have occupancy certificate cannot be accepted as collateral in public banks generally, but we can try with certificate of possession and property tax receipt
• For CIDCO properties in Navi Mumbai (Vashi to Panvel)- Society formation is mandatory and related documents to it, Association formation is not accepted, a letter is required from the bank to the CIDCO authority, CIDCO letter, 2 Affidavits, a letter in favor of CIDCO. If conveyance deed is not there- Builder NOC required, if Available- CIDCO NOC required.

If your loan application includes any of the above-mentioned conditions then your education loan application might get rejected. To avoid loan application rejection and proceed smoothly with your education loan application, start your loan process with WeMakeScholars

WeMakeScholars is a government-funded student platform that provides funding solutions to students in Mumbai and throughout India, for higher education both in India and abroad. We have partnerships with over 14 public and private banks, as well as non-banking financial companies in India. Here are some additional reasons to choose WeMakeScholars as your education loan partner:

Faster Processing: Processing times for education loans with WeMakeScholars are 50% faster than what banks typically require. We can process a loan from a private bank or non-banking financial company in just 6-7 days, and from a public bank with collateral in 15-20 days.

Competitive Interest Rates: As we are one of the largest education loan partners for banks, students who apply for their loans through WeMakeScholars can receive an interest rate discount of 0.5% to 2%.

Expert advice: Your financial officer will help you choose the best lender based on your eligibility and the bank's rules, after thoroughly analyzing your loan profile.

Digitized Application process: Students can easily apply for a student loan online at any time and from any location. The need to make repeated trips to the bank to submit necessary documents is also reduced through our online document submission feature.

Support for negotiations: We offer assistance in negotiating loan terms and interest rates with the banks to make the process simpler for you.

End-to-end support: Your financial officer will remain by your side throughout the loan sanctioning process, and even at the time of disbursement, to address any post-approval concerns.

Tax advantages: We help you take advantage of the income tax department's tax-saving programs, such as Section 80E, 80C, and others, as well as tax collected at source, to assist you in saving money and obtaining tax advantages on your student loan.

Cost-free services: As we are funded by the IT Ministry as part of the Digital India Campaign, all of our services for authorizing prime loans are provided free of charge to all students.

Cashback offer: Upon release of your funds, you may receive up to Rs 3,000 as cashback.

If a student gets an education loan of Rs 40 lacs disbursed for their higher education in Australia, at 10% rate of interest and 12 years as repayment duration after the moratorium period, then that student will have to repay the loan as per the following amortization table:

Central Government Interest Subsidy Scheme (CSIS)

The program, which provides eligible students with a reduction on interest on school loans totaling up to 7.5 lacs, was created and is administered by the Indian federal government. However, the total loan amount may be greater than 7.5 lacs.

Eligibility criteria for CSIS

• Only students from India are eligible.
• just for Indian study-abroad programmes
• Students must come from a socioeconomically disadvantaged group with a family income of under 4.5 lacs.

Padho Pardesh Scheme

An education loan interest subsidy of up to 7.5 lacs is available through this scheme to eligible students from India's recognized minority communities who are also EWS members for their overseas studies. However, the loan amount might be higher.

Eligibility for Padho Pardesh Scheme

• Only students from India are eligible.
• Only for international study programs
• The family's combined total income of the student cannot exceed Rs 6 LPA.

Note: Students will continue to get subsidy benefits if they applied for interest subsidy benefits under this plan before 1 April 2022. Due to the government's decision to end this program on March 31, 2022.

Dr. Ambedkar Central Sector Scheme of Interest Subsidy 

For students who qualify for Dr. Ambedkar's interest subsidy program, there is no interest to be paid on education loans up to 7.5 lacs.

Eligibility criteria for Dr. Ambedkar's interest subsidy scheme

• A Cast certificate is mandatory
• The family income of the applicant should be less than Rs 8 lacs per annum
• An income certificate will be required
• Student must have taken admission abroad in Master, MPhil or PhD