This blog is written to give you full details and helpful knowledge about Study loan UK. You can turn your dreams into reality by getting a loan after reading this blog.
Table of Contents
Can Indian students get student loans in UK?
How to Get an Education Loan as an Indian Student to Study in UK?
Which bank is best for education loans for UK banks without collaterals?
What percentage of UK students take a loan?
Is it easy to get an education loan in the UK?
Maximum amount that I can get from loan with collateral for UK
Did you know?
In 2023, students graduating from English universities will have incurred an average of 44,940 British pounds of student loan debt, compared with 35,780 pounds in Wales, 24,500 pounds in Northern Ireland, and around 15,430 pounds in Scotland.
If you have decided to study in UK, you should be aware that it is one of the most expensive countries to study abroad. Tuition fees at colleges, as well as the cost of living, which includes accommodation, transportation, food, medical expenditures, and other expenses, are all included in the overall cost. If you do not plan your spending, you may feel financially constrained.
Here is a list of some reasons why one should opt for a Student Loan in UK:
1. Educational loans typically offer lower interest rates compared to other loan options like home loans, car loans, and personal loans. This makes them a more affordable way to finance your education.
An additional benefit?
Government banks in India often provide a further interest rate reduction of 0.5% for female borrowers. This can lead to even greater savings on your educational journey.
2. A UK student loan covers a wide range of expenses related to your studies, including tuition fees, accommodation, transportation, university charges, living expenses, and essential study equipment.
3. Many parents in the UK liquidate their money to pay for their kids' education, which undermines their long-term goals. Here, student loans can be helpful. Banks hold your bank savings, insurance, and bonds. They utilize them to provide you with a loan for your child's education, allowing you to avoid draining your funds.
Thus, an education loan is the ideal choice for covering all of your fees securely and timely while still meeting admission and visa criteria.
If you want to apply for a study loan for overseas students in the United Kingdom, you will need the following documents:
These are some of the documents required for a UK education loan. In the next section, let's understand how many types of Loans are available to study in the UK.
There are two types of study loans available to UK overseas students in India: collateral education loans and non-collateral education loans.
Let us know more about these two types of student loans in UK:
1. Collateral Study Loan:
A collateral education loan, also known as a secured loan, requires security or collateral in order to be granted. The security might be significant or immaterial, such as real estate or fixed assets like fixed deposits.
You can get funding of up to 1.5 crores at an interest rate of 10.25% for your academic expenses by opting for secured loans, which are generally provided by public banks; you do not have to pay any interest during the moratorium period.
| Basis | Details |
|---|---|
| Loan Amount | Upto 1.5 Cr |
| Expenses Covered | Tuition fees, Transportation, Accommodation, Cost of living, Cost of books, Uniforms, Library fees, etc. |
| Interest Rate | 10.25% |
| Eligible courses | Master’s, MBA, PG Diploma, Ph.D., Professional/ vocational courses, UG |
| Moratorium Period | The total duration of the course + 6 months |
| Repayment Duration | Upto 15 years |
| Eligibility Criteria | Applicant must be 18 years of age and citizen of India Must receive admission by qualifying entrance exam |
| Types of Collateral | Fixed Property: House, Land, Flat Liquid Security: FDs, LIC, Government Bonds |
2. Non-collateral Study Loan:
A non-collateral study loan in the UK, often known as an unsecured loan, implies that you do not have to put up any collateral when applying for the loan. This sort of study loan without collateral is more common among students looking for a student loan in the UK.
You can get up to 45 lacs for higher education in the UK, with a 15-year payback term. During the moratorium period, unsecured loans, which private banks or NBFCs often give, must be paid in full or partially.
Thinking about how to get an Educational loan without collateral? Here are all the details of a loan without collateral.
| Basis | Details |
|---|---|
| Loan Amount | Upto 1 Cr |
| Expenses Covered | Tuition fees, Transportation, Accommodation, Cost of living, Cost of books, Uniforms, Library fees, etc |
| Interest Rate | 11.5% |
| Eligible courses | Master’s, MBA, PG Diploma, Ph.D., Professional/ vocational courses, UG |
| Moratorium Period | The total duration of the course + 1 year |
| Repayment Duration | Within 15 years |
| Eligibility Criteria | Applicant must be 18 years of age and citizen of India Must receive admission by qualifying entrance exam |
Living costs in the UK are quite high. Candidates also need to obtain a letter of recommendation from the UK before studying there. There are numerous education loan providers for studying in the UK. Several of these are listed below:
| Bank Name | Maximum Amount of Loan (INR)/ Interest Rate |
|---|---|
| Bank of Baroda | 15000000 8.50 - 9.15% |
| Central Bank of India | 2000000 8.65 - 10.60% |
| State Bank of India | 15000000 10.50% |
| Bank of India | 4000000 8.95 - 9.75% |
| Allahabad Bank | 5000000 7.15 - 10.05% |
| HDFC Bank | 3000000 14% |
| Punjab National Bank | On the basis of the need 8.90% |
| Axis Bank | 7500000 13.70 - 15.20% |
| ICICI Bank | 10000000 10.50 - 13% |
Before you apply, be sure you meet the criteria to qualify for an education loan. Different banks have different policies and qualifying requirements. The common qualifying requirements adopted by all banks are:
Apart from the fees, an applicant also requires a valid UK student visa in order to study in the UK. The various expenditures that are covered under a study loan for the UK are as follows:
Fees owed to the institution
With this knowledge, let's look at UK students' education loan repayment procedure.
Before proceeding with your UK student loan application, it's essential to understand the repayment conditions. Here, we have outlined the repayment schedule tailored for international students from Indian banks.
Applying for an education loan in the UK requires a lot of research and a series of steps. The method may appear difficult initially, and the student may become overwhelmed when applying. On the other hand, Gradding makes things easy for students by providing experienced counsellors to assist them at every stage of the process with no additional cost. Students should be aware of the following tips before applying for a UK student loan:
1) Find the Right Financial Institution
Choosing a bank or NBFC that offers the finest loan terms is more significant than providing more funds. It is also vital to confirm if the lender allows you to make EMI payments in advance or allows you to pay off the loan in installments. Knowing the service costs and prepayment penalties is essential.
2) Cost of EMI
The EMI paid for an education loan in the UK is determined by how the student decides to repay the loan. Some students opt to borrow money for a longer period of time since the EMI is lower. However, the loan's cost and interest would be higher in this instance. As a result, if the prospects of landing a well-paying job after the course are high, a shorter loan duration is preferable.
3) Evaluate Interest rate
It is vital to understand the difference between fixed and variable interest rates when taking out a loan. When you have a fixed interest rate, your monthly payments are predictable since they remain the same throughout the loan. However, variable interest rates fluctuate with the market, and the amount you must return each month may increase or decrease over time. When picking a student loan, it is critical to examine the interest rates given by various lenders. You can choose the type of interest rate that best fits your financial goals and risk tolerance, considering the potential implications on your overall loan payments.
Conclusion!
Studying in one of the top study-abroad countries, such as the United Kingdom, is costly. A student loan for UK is a wise solution for managing your costs rather than delaying your studies in the UK. The guide above must have given you insights into the eligibility, requirements, and procedures for obtaining a student loan in the UK. There are various options to fund your education in the United Kingdom. Ensure that all your costs are carefully planned so the loan does not strain you. If you are still confused and need expert guidance, you can connect with our experts. They can help you in every aspect of studying in the UK.
Yes! Indian students can get loans from several banks and other financial institutions like NBFCs. Students can get both secured and unsecured loans. To decide which loan to take, consider the expenses it covers, the interest rate, and the moratorium period.
Follow the 4C steps below to know how to get an education loan in the UK:
1. Choose the course and college.
2. Calculate the amount you would need.
3. Compare various loan options available.
4. Check your chosen lender's policies and requirements.
5. Fill out the loan application with the documents they asked for.
Many banks provide study loans to international students in the UK. Some of them without collaterals are:
1. HDFC Bank
2. ICICI Bank
3. Avanse
4. Auxilo
5. IDFC
6. Incred
7. Axis Bank
Taking a student loan is one of the most common ways to support education. 95% of all eligible students go for a loan. The current maximum interest rate for these are 7.5%
As a UG or a PG student, you must show some liquid assets in your scholarship letters and financial statements. However, it can become easy with the guidance of a study abroad expert.
The SBI offers loan amounts of up to 1.5 crores at an interest rate of 10.55%.
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