HDFC Bank Education Loan

HDFC Bank Education Loans

What Is an Education Loan?

An Education loan is the loan or funds acquired by an individual to pursue higher studies in India or abroad. The loan repayment commences for the student after completing the education and a period of 6 months is given as grace period to students to get or join a job.

The repayment amount will be determined by your choice of interest, you need to decide how you want to repay the loan. That is if you want to start paying during the time of moratorium period itself or after the moratorium period. The Moratorium period is the time of your education plus 6 months or 1 year given to get a job. It is only after this time that you are expected to pay the loan.

The loan interest starts to accrue at the time of dispersal of funds, so at the time of your graduation you have a huge amount to repay. The other option is your parents or guardian can start paying the loan during the moratorium period itself where it is calculated as a simple interest.

This way your loan amount at the time of graduation is drastically reduced.

There are 4 types of education loans in India

1. Under Graduate education loan - These are given to students who have completed their secondary education and looking to do higher studies in the form of under graduation. It can be done in India or abroad.

2. Post graduate education loan - These are education loans given to individuals who want to pursue post-graduation after completing under graduation course from a reputed university/college. Here also the loan can be for studying in India or abroad.

3. Parents availing education loan - This is the case where the parents take loan for the education purposes of their children. This is an unsecured loan and need not be for graduate or post-graduation courses but also for elementary and higher secondary courses.

4. Career growth education loans - These are loans provided to young people who want to pursue courses or trainings, certifications that will benefit their career growth.

About HDFC Bank

Headquartered in Mumbai, HDFC Bank Limited is an Indian banking and financial services company. Being the largest private sector lender by assets, HDFC has 84,325 employees, 4,727 branches and 12,220 ATMs across 2,666 cities.

An Introduction to HDFC Bank Education Loans

Education is one area where everybody is willing to spend a lot of money to live a prosperous life in the future. Being one of the major education loan providers,HDFC Bank understands the needs of the students and offers extremely competitive education loans at better interest rates. Every year, a large number of students secure admissions in top universities and colleges in India and abroad with HDFC Bank education loans.

Advantages of HDFC Bank Education Loan

Following are some of the advantages of applying for an educational loan with HDFC Bank.

• Low interest rate
• Less paperwork
• Faster Disbursal
• Hassle-free application process

Key Highlights of HDFC Bank Education Loan

Features of HDFC Bank Education Loan for Studies in India

Objective: To provide term loan to Indian students for pursuing higher education in India.

Quantum of Loan: Up to 10 Lakhs for studies in India.

Margin: No margin is required for loans up to INR 4 Lakhs, 5% of margin for loans above INR 4 Lakhs for studies in India.

Repayment Period: The tenure is up to 10 years after completing the course for loans up to 7.5 Lakhs and 15 years for above 7.5 Lakhs. The moratorium period is available only for select courses.

Security: No security required for loan up to 4 Lakhs and parents to be co-borrowers. For above 7.5 Lakhs, tangible collateral required with third-party guarantee.

Processing Fees: 1% of the loan amount or INR 1000 whichever is higher.

Courses Covered

The courses covered under HDFC Bank education loan are graduation, post-graduation, including technical/professional courses with employment potentials conducted by colleges/universities approved by UGC/Government, AICTE/Department of Electronics/IMC, autonomous institutions like IIM, IIT, etc.

Expenses Covered

Expenses covered under HDFC Bank education loan are payment of course fees, purchase of books, equipments, instruments, uniform, payment of hostel fees, examination fees, study tools etc.

Eligibility Criteria: Who Can Apply?

• Must be an Indian Resident.
• Applicant should have secured admission with the educational institution.
• Should be between 16 to 35 years of age.

Interest Rate of HDFC Bank Education Loan for Studies in India

The rate of interest ranges between 9% to 14.1%, which is however subject to change at the discretion of the bank.

Features of HDFC Bank Education Loan for Foreign Education

Objective: To provide term loan to Indian students for pursuing higher education in foreign universities.

Quantum of Loan: Up to 20 Lakhs for studies overseas.

Margin: No margin required for loans up to INR 4 Lakhs and 15% of margin for above 4 Lakhs for studies overseas.

Repayment Period: The tenure is up to 10 years after completing the course for loans up to 7.5 Lakhs and 15 years for above 7.5 Lakhs.

Security: The parents or the guardian will be the co-applicant or the loan and the primary debtor. Tangible collateral will be accepted as security by the bank with the third-party guarantee. No security required for loans up to 4 Lakhs.

Processing Fees: 1.5% of the loan amount with applicable taxes.

Courses Covered

Courses offered at select colleges and universities in foreign countries.

Expenses Covered

Expenses covered under HDFC Bank education loan are payment of course fees, purchase of books, equipments, instruments, uniform, payment of hostel fees, examination fees, study tools, and passage expenses, (for study abroad).

Eligibility Criteria: Who Can Apply?

• Must be an Indian Resident.
• Applicant should have secured admission with the educational institution.
• Should be between 16 to 35 years of age.

Interest Rate on HDFC Bank Education Loan for Studies abroad

The rate of interest ranges between 9% to 14.1%, which is however subject to change at the discretion of the bank.

Documents Required

• Letter of admission
• Filled in Loan Application Form
• 2 passport size photographs
• Statement of cost of study
• PAN Card of the student and Parent/ Guardian
• AADHAR Card of the student and Parent/ Guardian
• Proof of identity (Driving Licence/Passport/Aadhar/ any photo identity)
• Proof of residence (Driving Licence/Passport/Electricity bill/Telephone bill)
• Student/Co-borrower/ guarantor's bank account statement for last 6 months
• IT return/ IT assessment order, of previous 2 years of Parent/ Guardian/ other co-borrower (if IT Payee)
• Brief statement of assets & liabilities of Parent/ Guardian/ other co-borrower
• Proof of income (i.e. salary slips/ Form 16) Parent/ Guardian/ other co-borrower

EMI Payment Methods

HDFC Bank education loan can be repaid in following three ways.

Standing Instruction (SI): If you are an existing account holder with HDFC Bank, Standing Instruction is the best mode of repayment. Your EMI amount will be debited automatically at the end of the monthly cycle from the HDFC Bank account you specify.

Electronic Clearing Service (ECS): This mode can be used if you have a non-HDFC Bank account and would like your EMIs to be debited automatically at the end of the monthly cycle from this account.

Post-Dated Cheques (PDCs): You can submit post-dated EMI cheques from a non-HDFC Bank account at your nearest HDFC Bank Loan Centre. A fresh set of PDCs will have to be submitted in a timely manner. Please note Post Dated Cheques will be collected non-ECS locations only.

It is recommended that you opt for either the SI or ECS mode of payment for faster and less prone to error than the use of PDCs.

How to Apply for HDFC Bank Education Loan?

You can either apply online or visit a nearby HDFC Bank branch for the application. You can also download the education loan application form from the HDFC Bank official website, complete the form and submit it the bank representative.

You can also check your eligibility for an education loan through CreditMantri and apply for it.

HDFC Bank Education loan FAQ