Loan for study abroad is an extremely popular alternative for parents who do not wish to sink into their lifetime savings for sponsoring their kids’ education. Study loans do not just help students academically, but is also used to cover additional expenses such as travel costs and buying education supplies and equipment during the duration of course. There are various kinds of education loans which banks provide, but by and large, the purpose of study abroad loans is to help students achieve their dream career.
Study abroad loans can be of the same numbers of kinds as the number of education programs that they tend to fund. These can be skill based education loans, students’ loans for diploma and many more. Broadly, we can categorize these loans as-
Secured education loan is only provided by Nationalized Banks such as State Bank of Indi and Bank of Baroda. Unsecured education loan or education loan without collateral is provided by all private banks like ICICI, AXIS all the NBFCs - HDFC Credila, Avanse, Incred&Auxilo. We have lenders such as MPower and Prodigy who provide education loan without collateral and without Cosignor. These categories are dependent upon the need and requirements of borrowers and whether or not, they have something to guarantee. These categories of loans are largely dependent upon the availability of guarantee or collateral from an applicant or the borrower. We have described the said categories here, which will tell you more about the education loan without collateral. Based on security of guarantee or collateral 1.Secure Loans: These are the kinds of overseas education loans which are mostly covered by, tangible assets or collaterals. This may becovered in the form of third-party guarantee. 2.Non-Secured Loan: These are the kinds of loans which aren’t covered by guarantee or collateral, which is why they are called non-secured or unsecured education loan or education loan without collateral. These are immensely risky for the banks because they are perilous and can forfeit. Loan for study abroad Based on the type of collateral 1.Loan against property: A borrower may pledge agricultural or non-agricultural property against the loan amount, and this includes land/flat/house etc. 2.Loan against deposits: A borrower can pledge as collateral, their fixed deposits or recurring-deposits or even the gold-deposits. 3. Loan against securities: Any borrower can also pledge equity shares or debenturesor bonds while securing loan for study abroad. 4.Loan against third-party guarantee: This is a kind of collateral where a borrower submits to the bank, a certificate of guarantee for securing study abroad loan. This is submitted from a borrower’s home bank. It may also include certificate of guarantee through a borrower’s employer, in certain cases. Education loan without collateral is definitely possible, albeit it comes with higher rate of interest since in these loans, the bank does not ask for collateral. Unsecured loan is seen as a probable NPA by the bank, which is why, the process may be cumbersome and delayed with many more documents than a secured loan. In case of an Unsecured Loan the following is taken into consideration
Eduloansbecomes your one stop solution for all kinds of education loans. We help you with faster loan processing and entire documentation through our loan experts. We would provide you the best deal for education loan without Collateral through our 15 lenders on the platform.
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