Education Loan for Studying in the USA – Check Eligibility, Required Documents & Application Process

USA Study Education Loan is one of the most readily available options for Indian students to finance their overseas studies. Such loans usually finance tuition, hostel, travel, and other study-related costs. Student loans are made available by several banks and NBFCs at reasonable rates of interest, and most of them take into account an admission letter given by a well-known U.S. institution at the time of sanction.

To obtain an education loan for studying in the USA, students might require a co-applicant or collateral based on the loan amount. Applying for various lenders becomes simpler through channels like the Vidya Lakshmi Portal. Choosing the right loan will relieve financial pressure and improve study goals.

Education Loan for Studying in the USA

It boasts some of the top-ranked universities globally, such as Harvard, MIT, and Stanford, where students from all over the globe flock. With more than a hundred thousand student visas issued in early 2024, it continues to remain among the most desired for international education. American universities also facilitate global studies through many student exchange programs.

While the academic scholarships are staggering, the entire cost of studying in the U.S. can be prohibitively high. In addition to tuition charges, students also have to factor in living expenses, food, and local transportation. With such a scenario, education loans act as a cushion to the expense.

USA Education Loan Overview

Department	Ministry of Education, Indian Banks/NBFCs
Program Name	Education Loan for Overseas Studies
Country	USA
Loan Amount	₹20 lakhs to ₹1.5 crores
Payment Status	Semester-wise or annual disbursement
Repayment Tenure	10 to 20 years
Category	Education
Official Website	www.vidyalakshmi.co.in (& Bank websites)

Key Features of Education Loan for Study

Before applying for an education loan to study in the USA, people are highly advised to go through the key aspects of the loan that are discussed below:

• Interest Charges

When one takes money against education, the lenders ask for an interest rate on borrowed money. The exact rate varies with factors like the amount borrowed, loan duration, type of lender, and your co-applicant’s credit record.

• Loan Repayment Terms

Repayment usually starts after completion of the course, as most banks offer a grace period. Some lenders offer six months from the date of joining employment, whereas others offer up to one year from the point of completion. The loan is usually paid back in equal monthly installments over 10 to 20 years.

• Security or Collateral

Most lenders insist on security for the loan, i.e., property or financial collateral. The small loans will not require collateral but may be guaranteed by a third-party guarantor who will be liable in case of default.

• Inclusions in the Loan

Other than tuition fees, education loans can also finance accommodation, lab and library fees, study materials, and living expenses for day-to-day needs.

Who is Eligible to Get an Education Loan for Study

Indian students who are eager to pursue studies in the USA have to adhere to the eligibility criteria, whose basic requirements are mentioned below:

• The applicant applying for a loan should be an Indian national in order to be eligible to apply for an education loan, and proof of nationality is usually sought while applying for a loan.
• The candidate should be 18 years or older at the time of application; if under age, a guardian or parent should apply on his/her behalf.
• Admission should be obtained at a USA-accredited college or university, and an official offer letter would be preferable before applying for the loan.
• Sound academic qualifications and a good, consistent academic record are most frequently among the initial requirements, and sound academic qualifications enhance the chances of loan acceptance.

Documents Required for an Education Loan to Study

Below, we have mentioned the documents required for verification purposes by the authorities or government prior to sanctioning your loan application.

• Confirmation of admission from the U.S. university (offer letter or acceptance letter).
• Proof of applicant and co-applicant residence (Aadhar card or utility bills).
• Borrower’s and co-borrower’s proof of identity (PAN card, voter ID, or such other ID as is appropriate).
• 10th class and education certificates & Marksheets as well.
• Co-applicant’s income proof, like – Salary vouchers, Form 16, or ITR submissions.
• Entrance exam test scores such as TOEFL, IELTS, GRE, or GMAT.
• A copy of the valid applicant’s passport.
• Co-applicant’s or the guarantor’s statement of financial assets and liabilities.
• Two recent passport-sized photos of the applicant and co-borrower.

How to Apply for an Education Loan to Study

For the Education Loan for Studying in the USA application, the following are to be followed:

• Select your preferred course and university in the U.S. that is suitable for your academic aspirations.
• A rough estimate of total costs, including tuition fees, accommodation, travel, and living expenses.
• Choose a suitable co-applicant or surety who would be ready to bear financial responsibilities if needed.
• Apply for the loan at least 90 days prior to your pre-booked visa date.
• Compare and check interest rates and repayment schedules of at least two banks or NBFCs.
• Fill out the loan application form correctly according to your selected lender.

Student Loans Help You Study in the USA

Student loans facilitate access to education in the USA without initial financial expenditure. For example, they cover living expenditures, housing, transportation, and tuition fees. With the choice of a lender with proper terms and awareness of the burden of repayment, students can emphasize their studies.

At graduation, a steady income permits modest repayment, thus making investment in foreign education a viable and attainable investment for future professional enhancement.

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