✓ Documents Required for Education Loan
✓ Preferred Countries for Higher Education Loan
Every year, Lakhs of students in India apply for an abroad education loan. Only a few manage to receive funding from their lenders. The proportion of students who have failed to obtain funding due to an education loan rejection is way higher than those who have successfully obtained the same. In the majority of cases, candidates are not even aware of the reasons behind the education loan rejection.
This article aims to address some of the major indicators behind an education loan rejection and provide tips on how you can successfully manage to obtain funding for higher education abroad or in India.
Some of the major reasons why lenders reject an education loan are listed below.
To those who have applied for any kind of loan previously, the CIBIL score may not be an alien subject. The Credit Bureau of India Ltd. or as it is famously called CIBIL is the major governing body that examines every loan applicant's credit score. This is done so in order to determine an applicant's worthiness to receive any particular loan.
When it comes to education loans, most lenders have very strict policies regarding the CIBIL scores of both, education loan applicants, as well as their co-applicants. A CIBIL score lower than 600 is one of the reasons behind an education loan rejection in a majority of cases. In order to know whether you qualify for an abroad education loan with your current CIBIL score, get in touch with the financial team of WeMakeScholars at the earliest. Let us move on to understand the next factor which invites an education loan rejection.
The application process to obtain an overseas education loan may seem easy to most of you. However, that is definitely not the case. Many students face education loan rejection due to their poor academic performance. So what can be considered by lenders as poor academic performance?
This is one of the major factors behind why many students get their education loan applications rejected. It is important to understand that while many lenders, especially private ones promote the approval of an education loan for any country in the world, this is not the case in reality. Education loan lenders, both public and private, maintain a list of certain countries and courses for which an education loan is approved.
Some of the countries which are on the lender's list as the best countries for studying abroad include
Students who have been selected into universities from countries not rewound for their education system face higher chances of an education loan rejection like-
Most of the education loan lenders in India have a specific list of courses for which they lend funding. Students who have secured admission into any of these courses are more likely to get approval from their respective lenders.
More often than not, lenders do not provide specific reasons why an abroad education loan was rejected. Insufficient documentation is one of the most common reasons for an education loan rejection.
Documentation is an essential part of the abroad education loan process. Especially when it comes to collateral education loans from government banks. When you pledge any of the 7 types of collateral securities against an abroad education loan, it is crucial that you provide the right documents pertaining to the asset being pledged as collateral.
The requirement for education loan documents differs from lender to lender. For example, the documents required by private lenders for an education loan without collateral are different than those required by public banks. This concept is explained well in Episode 30 of the Loanflix web series.
At WeMakeScholars, the financial team keeps a track of the changes in the education loan market and guides the loan applicants accordingly. Thousands of students who stood no chance of getting an education loan under any circumstances were able to secure one successfully without any hassles because they approached the WeMakeScholars team to accompany them on their journey.
So what are you waiting for? Request a callback today and get your education loan in a hassle-free manner, without paying anything in return for the services.
Why do education loans sometimes get rejected? Is it because the banks are just being difficult?
Education loans can be rejected for several reasons, and it's not because banks are being difficult. Banks have certain eligibility criteria that they need to follow to ensure that they are giving the loan to a deserving candidate who has the ability to repay it. The reasons why education loans can be rejected include incomplete documentation, poor credit score, low academic performance, inadequate collateral or guarantor, unrecognized institute or course, and many more.
Can education loans be rejected if the student has poor academic performance?
Yes, education loans can be rejected if the student has a poor academic record. Banks usually consider the academic performance of the student to assess their future earning potential and the likelihood of them being able to repay the loan. However, some lenders may still consider your application if you have a strong co-signer or collateral. But to clarify the possible solution for getting the Education loan you can ask our experts. They will provide you with the exact information as per your profile.
Can education loans be rejected if the co-applicant's credit score is poor?
Yes, education loans can be rejected if the co-applicants credit score is poor. Co-applicants are equally responsible for the repayment of the loan, and their creditworthiness is also assessed by the lender. A poor credit score of the co-applicants can indicate a higher risk for the lender, which can result in a rejection of the loan application. It's important to choose co-applicants who have good credit scores and stable incomes.
Can education loans be rejected if I have a history of loan defaults?
Yes, education loans can be rejected if you have a history of loan defaults or if you have a bad credit history. This indicates your inability to repay the loan, which can make the lender hesitant to approve your loan application. It's important to improve your credit score and repay any outstanding loans before applying for an education loan
Can education loans be rejected if I don't have a permanent address?
Yes, education loans can be rejected if you don't have a permanent address or if your address proof is not valid. Banks need valid address proof to ensure that they can reach you in case of any issues or if they need to collect any documents from you. You may need to provide additional documentation to prove your address.