Benefits of Personal Loan In Higher Education

Higher education can be costly, especially if you go to a university abroad. But it’s also a chance to do something that can teach you a lot and help your career in a big way. 

If you aren’t sure how you’ll pay for higher education in a foreign country, a higher education loan could be the answer. You can get an education loan or a personal loan. 

Personal loans are unsecured. This means that you don’t have to put up any security or collateral. They are simpler to get. The terms for paying them back are also more flexible. Also, getting a personal loan for education has several tax advantages.

What are personal loans for education?

Personal loans for education are a type of credit that a bank offers. You can use the money you borrow for anything you want. A personal loan for education can help you pay for things like tuition, housing, and other school-related costs, as well as things like food, travel, and other non-school-related costs. 

These personal loans for higher education are not backed by any assets. It means that if you want to borrow money from a bank, you don’t have to put up gold, property, or other valuables as collateral. On the other hand, you might have to pay more in interest on higher education loans. 

Personal loans for higher education are easy to apply for, take little time, and require little paperwork. Once your application has been approved, the money will be sent to the bank account you have chosen.

Benefits of a personal loan for education

There are some factors you should know before getting a personal loan for your higher education.

• Credit score for personal loans

CIBIL gives each person a credit score based on how good of a credit risk they are. If you have a good credit score, it will be easier for you to get a loan. Before giving you a loan, lenders always look at your credit score.

For a personal loan, all you need is a credit score of 750 or higher. Half the work is done with this score. When you get a personal loan, you don’t have to give a lot of complicated information about your finances.

• Use for any purpose

As already said, unlike an education loan, a personal loan for education can be used for anything. If you take out an education loan, the money will be sent directly to the bank account that your school or college has set up. But if you take out a personal loan, the money will go straight into your bank account. 

So, you can take a personal loan to pay for any type of expense, such as living costs, housing costs, and so on. On the other hand, you can only use an education loan to pay for school or college. This is the main advantage of a personal loan for education over an education loan, although there are tax benefits for student loans.

• No need for security 

Personal loans don’t need the person to put up property or jewellery as security. These loans don’t require any collateral. The fact that these loans are not secured means that the borrower has to pay a higher interest rate. But it makes getting these loans less stressful. Also, you don’t have to own expensive things to get a personal loan. Compared to other types of loans, there are fewer restrictions on who can get one of these loans. 

• A high amount of loan 

A personal loan can be as much as Rs. 30 lakh (varies by lender). This amount of money will be sufficient to pay for high-quality education in India. You might have enough money to pay for things other than college or school. 

Personal loans are a great choice for students because they can borrow a lot of money without putting anything up as collateral. 

The high loan amount also gives you the freedom to choose a sum you’re comfortable with. Due to increased loan limits, you can borrow the money you need.

• Flexible tenures 

Personal loans can be paid off in about 60 months, depending on the lender (or 5 years). When you apply for a loan, you can choose how long you want it to last. The loan term is flexible. 

So you can choose whether to pay less in interest or more each month, depending on your needs. If you have a loan with a longer term, you will pay more interest in total. On the other hand, if the loan term is shorter, the monthly costs will be higher.

• Quick disbursal

No one can wait to get into college or school. After getting accepted, you have a short time to pay the necessary fees for the year. Personal loans can help because they can be paid out quickly. The whole process of applying for a loan can be done online. 

After you apply, the lender will easily verify your application to make sure everything is in order. If everything is in order, the loan will be approved within a few days of the date you applied. Once the loan is approved, the money will be in your authorised account within 24 hours.

• Minimal documentation 

Lenders know that getting a loan should be easy for the person who needs it. So, they only ask for the documents they need to make things easier for the borrower. Personal loans are unsecured loans, so the paperwork needed is simple. Most of the time, you will only need the following documents:

• Proof of identity
• Proof of address
• Proof of income
• Proof of employment

Conclusion

When thinking about how to pay for your child’s education, a personal loan for education might be the best choice. These loans are designed to be easy and convenient. Since the loan doesn’t require collateral, the borrower doesn’t have to worry. Even though you don’t get the tax break that comes with an education loan, there are many other benefits to getting a personal loan instead of an education loan.

For more blogs like this, you can visit the Piramal Finance website and explore their products and services.