If you're a student wondering how to get education loan in Andhra Pradesh to study in India or abroad, this is the perfect blog for you.
You might need up to Rs. 15 lakhs for colleges within India and up to Rs. 45 lakhs for colleges abroad. Most education loans in Andhra Pradesh have interest rates from 8.5% to 13%.
Keep Reading to know more.
Best Banks for Education Loan in Andhra Pradesh for Studies in India
Education Loan In Andhra Pradesh: Eligibility Criteria
Here are the various eligibility criteria to be fulfilled by the applicant and the co-applicant while filling out an education loan in Andhra Pradesh:
Eligibility Criteria for Applicants
Eligibility Criteria for Co-applicants
The applicant must be an Indian citizen
The university should be recognised
The applicant must have been selected through a merit-based process or by qualifying in an entrance exam
The applicant must hold a valid Indian passport
The co-applicant must be an Indian citizen
Only the applicant's parents can serve as co-applicants
If the parents are deceased, guardians are eligible to be co-applicants
If the applicant is married, spouses or parents-in-law can serve as co-applicants
Education Loan in Andhra Pradesh: Documents Required
Here is a list of all documents required while taking an education loan in Andhra Pradesh:
1. For Unsecured Loan
To apply for the loan, you must complete an application form that includes two photographs, your signature, and basic personal information.
Category
Documents Required
Student Documents
Identification Documents: Aadhar card, PAN card, and passport
Admission Letter: A letter confirming admission to a university
Utility Bills: Recent electricity bills or house tax receipts
Academic Records: 10th, 12th, and degree/diploma certificates
Competitive Exam Scores: Scores from exams like IELTS, TOEFL, GRE, or GMAT (if applicable)
Gap Certificate: Required for any gap between degrees
Work Experience: A letter detailing work experience (if relevant)
Co-applicant Documents
For Salaried Individuals:
Last 3 months of salary slips
6 months of bank statements
Company ID
Previous 2 years of Form 16
Last 2 years of Income Tax Returns (ITRs)
For Self-Employed Individuals:
Last 3 years of ITRs
6 months of bank statements
Balance sheet and profit & loss account for the previous 3 years
Proof of business address
Other Documents
A letter from the co-applicant accepting responsibility for any costs not covered by the loan (format provided by the financial officer)
Bank statement detailing financial transactions of both student and co-applicant
Invoice for any expenses like travel or a laptop
Receipts for any advance payments made
Loan statements from the previous year (if relevant)
A letter explaining any gaps in education or employment on Rs. 100 stamp paper
A letter explaining the absence of the co-applicant's income tax return (if applicable)
2. Additional Documents Required for a Secured Loan
Banks require additional documents while you get a secured loan. You will need ITR filings or income certificates. Moreover, the following documents are essential to verify the collateral being pledged:
Document/Requirement
Details
Property Title Deed
The title deed of the property serving as collateral must be submitted.
Registered Agreements
Includes the registered sale agreement, gift deed, or will related to the property.
Original Receipt
The original receipt for the above-mentioned agreement is required.
Allotment Letter
An allotment letter from a government authority, such as VGTM-UDA (Vijayawada Guntur Tenali Mangalagiri - Urban Development Authority), is needed.
Ownership Transfer Documents
Documents showing the transfer of property ownership for the last 30 years or an earlier chain of sale deeds, including an extract of the EC.
Property Tax and Utility Bills
Latest property tax and electricity bills, showing the same address as the collateral property, must be submitted.
Building Plan or Plot Layout
A municipality-approved building plan or plot layout for the property is required.
Repayment Plan for Education Loans in Andhra Pradesh
Students must repay the loan in monthly instalments once the moratorium is completed.
For example, if a student borrows 30 lakh rupees at an interest rate of 10.25% over 10 years, here is how the repayment plan will look:
Repayment Year
EMI (Yearly) (In INR)
Interest Portion (Yearly) (In INR)
Principal Portion (Yearly) (In INR)
Loan Outstanding (Year End) (In INR)
1
480,740.4
290,509.3
190,231.1
2,818,385
2
480,740.4
270,068
210,672.4
2,617,254
3
480,740.4
247,430.2
233,310.2
2,394,510
4
480,740.4
222,359.8
258,380.6
2,147,832
5
480,740.4
194,595.5
286,144.9
1,874,647
6
480,740.4
163,847.7
316,892.7
1,572,107
7
480,740.4
129,796
350,944.4
1,237,057
8
480,740.4
92,085.2
388,655.2
866,004.2
9
480,740.4
50,322.2
430,418.2
455,080.1
10
480,740.4
4,071.55
476,668.9
0
Interest Subsidy Schemes Applicable To Students From Andhra Pradesh
If you are wondering how to get an education loan in Andhra Pradesh through government schemes, then keep reading:
Scheme
Eligibility
Interest Subsidy
Income Limit
Application Process
Vidya Lakshmi Portal
Students from economically weaker sections who are residents of Andhra Pradesh
State government subsidised interest during the moratorium period
Annual family income limit around INR 6 lakh
Apply through the Vidya Lakshmi portal or banks offering the loan
Dr Ambedkar Interest Subsidy Scheme
OBC and EBC students admitted to master’s, M.Phil, or Ph.D. programs abroad
Rebate on interest payments during the moratorium period
Annual family income must not exceed INR 8 lakh
Provide a caste certificate (for OBC) and apply for loans from scheduled banks as per Indian Banking Association guidelines
Padho Pardesh Scheme
Students from EWS communities accepted into master’s, M.Phil, or Ph.D. courses abroad
Interest subsidy on education loans from scheduled banks
Annual family income must be less than INR 6 lakh
Provide a government-approved income certificate
Central Scheme for Interest Subsidy
EWS students enrolled in recognised education programs within India
Waiver of interest payments during the moratorium period
Annual family income must not exceed INR 4.5 lakh
Submit documentation proving EWS status; the scheme applies to loans for studies within India
Please check the latest details and specific eligibility criteria on the official website of the Andhra Pradesh State Government or consult with your bank to ensure you meet all the requirements for this subsidy.
Planning an education loan for engineering students in Andhra Pradesh is very easy.
Andhra Pradesh is home to several prestigious institutions offering diverse courses, including engineering, medical, and degree programs. Early planning for an education plan for engineering students in Andhra Pradesh is an intelligent choice.
Here are some of the top universities in the state:
Keep reading to learn how to get education loan in Andhra Pradesh.
For online applications, follow these steps:
Visit the bank’s official website.
Complete the online application form and upload the required documents as specified by the bank.
After ensuring that you have entered all details, submit the application form. You may then need to visit the branch to finalise any additional formalities and discuss the loan's terms and conditions.
Get an instant education loan with Propelld. Visit our website to know more!
Education Loan in Andhra Pradesh: Key Features
Understanding what an education loan in Andhra Pradesh from NBFCs typically covers is essential. Typical expenses covered through NBFC education loans include tuition fees, living costs, examination fees, the purchase of books, transportation, and insurance for overseas studies.
Here are some other essential parts of an education loan from an NBFC that you should know about:
1. Moratorium Period
One key aspect to consider is the moratorium period, which typically extends from the course duration to an additional 6 months to a year. Public banks generally charge only simple interest during this time, while private banks often apply compound interest. On the other hand, NBFCs usually require Equated Monthly Instalments (EMIs) during this period.
2. Loan Margin
Another crucial factor is the loan margin. For loans from public banks, you can expect a loan margin of about 10%, whereas private banks may require a margin ranging from 5% to 10%.
Understanding the loan margin is also vital. The loan margin is the percentage of the total amount you must pay out of your pocket. For instance, if the loan margin is 5%, you must contribute 5% of the total loan amount, with the lender covering the remaining 95%. Lenders often use this margin to mitigate their risk if you're unable to make the loan repayments.
3. Expenses covered
Students can avail education loans in Andhra Pradesh to cover various expenses, including tuition fees, examination fees, hostel fees, and necessary supplies like books and equipment. Some lenders can extend the costs to cover living expenses such as accommodation and food. Lenders may have specific requirements or restrictions on how you can use the loan. Hence, it is better to carefully review the loan terms to understand the costs the loan can cover.
4. Collateral Margin
Similarly, the collateral margin represents the portion of the loan secured by an asset pledged as collateral. If you cannot repay your loan, the lender can seize the collateral to recover their losses. It's essential to fully understand the terms related to the collateral margin, as these conditions will impact your financial obligations.
Why Choose Propelld for an Education Loan in Andhra Pradesh?
As a student under academic pressure, figuring out how to get an education loan in Andhra Pradesh might be overwhelming.
That is why at Propelld, we bring you education loan options tailored for students. We have a solution whether you are looking for an education loan for engineering students in Andhra Pradesh or medical students. Here are some benefits of taking an education loan for Propelld:
Feature
Details
Max Loan Amount
50 Lacs
Collateral
Not Required
Moratorium
Available
Processing Time
10 Times Faster than Banks
Disbursal Time
7 Days
Approval Rate
Higher than Banks
Special USP
Marks Based Approval
% Financed
100% of Fees
Get an easy education loan in Andhra Pradesh with Propelld now!
What is an Education Loan, and how does it work in Andhra Pradesh?
An education loan in Andhra Pradesh is a financial product that banks and financial institutions provide to help students cover their higher education costs. The loan typically covers tuition fees, living expenses, books, and other related costs, with repayment starting after the course completion or during the moratorium period.
Who is eligible for an education loan in Andhra Pradesh?
To be eligible, the student must be an Indian citizen who has secured admission to a recognised university in India or abroad. Various loan schemes have different eligibility requirements, so read them carefully.
What documents are required to apply for an education loan in Andhra Pradesh?
Key documents include proof of admission, KYC documents (Aadhar, PAN card), academic records, proof of income for the co-applicant, and a completed loan application form.
What is the maximum loan amount I can get for studying abroad from Andhra Pradesh?
The maximum loan amount for studying abroad typically depends on the lender and can range up to INR 1.5 crore with collateral. Unsecured loans generally have lower limits.
Are there any interest subsidy schemes available for education loans in Andhra Pradesh?
Yes, the Dr. Ambedkar Interest Subsidy Scheme for OBC and EBC students and the Central Scheme for Interest Subsidy (CSIS) provide interest waivers during the moratorium period for eligible students.
What is the interest rate on education loans in Andhra Pradesh?
Interest rates on education loans in Andhra Pradesh vary from 8.5% to 13%, depending on the lender, loan amount, and tenure.
Can I apply for an education loan online in Andhra Pradesh?
You can apply online by visiting the bank's official website, filling out the application form, and uploading the necessary documents. However, you may also need to visit the branch to complete further formalities.
What is a moratorium period in the context of education loans?
The moratorium period is when the borrower is not required to repay the loan. It typically lasts for the course duration plus six months to one year after graduation.
What are the collateral requirements for education loans in Andhra Pradesh?
For loans above INR 7.5 lakhs, collateral such as property, fixed deposits, or life insurance are some essential documents. Loans below this amount may not require collateral but may need a third-party guarantee.
Can parents or guardians act as co-applicants for an education loan?
Yes, parents, guardians, or spouses can act as co-applicants. Their income and creditworthiness play a crucial role in the loan's approval.
What expenses does an education loan cover in Andhra Pradesh?
Education loans generally cover tuition, living expenses, examination fees, book purchases, transportation, and even insurance premiums, depending on the bank's terms.
How long does processing an education loan application in Andhra Pradesh take?
The processing time varies by bank, but typically, it takes 15 to 20 days to submit all required documents.
What happens if I cannot repay the education loan on time?
If you default on the loan, the bank may take legal action, including seizing the collateral if provided. Your credit score will also adversely affect your ability to secure future loans.
Are there any tax benefits on education loans in Andhra Pradesh?
Yes, under Section 80E of the Income Tax Act, you can claim a deduction on the interest paid on education loans for up to 8 years from the start of repayment.
What should I consider before applying for an education loan in Andhra Pradesh?
Before applying, consider the interest rate, repayment tenure, moratorium period, collateral requirements, and whether any interest subsidy schemes are available. It is also essential to ensure a clear plan for repayment post-graduation.
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