Can a Student Get a Personal Loan?

Can a Student Get a Personal Loan?

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Find out if it possible for you as a student to get a personal loan?

Key Takeaways

  • Students can apply for personal loans to fund their education.
  • The loan is ideal for short term courses.
  • You can get loans as high as up to INR 15 lakhs.
  • Loans up to INR 5 lakhs do not warrant collateral.
  • Loans are approved and disbursed without hassles within a few hours to a couple of days.

Introduction

The cost of higher education has increased significantly with time. This is why most students worldwide have to rely on external funding in the form of personal loans. Such as loan helps you fund various expenses associated with your studies, whether it means buying books and supplies or paying tuition. If you are wondering, can I get a Personal Loan as a student, this article is for you.

Can a student get a Personal Loan?

The answer to the question, 'can students get Personal Loan' is yes, you can. You can apply for a personal loan and use the money to finance your education. Such a loan is typically the ideal choice if you need money to study short-term courses like diplomas, certificate, or vocational courses, where the cost of fees is not that high. Yes, you can take out a personal loan to fund your higher education or specialised courses in India and abroad. Let us now look at the features and benefits of such loans. Let us find out more.

Features and benefits of Personal Loans for students

  • The maximum loan amount is INR 15 lakh
  • The loan repayment tenure is flexible and ranges from 1 year to 5 years
  • Personal Loan for students can help you realise your dreams of higher education
  • It is an ideal alternative to other types of credit
  • You do not have to provide any collateral for loans up to INR 5 lakh
  • You can avail of deduction under Section 80E of the Income Tax Act for interest paid on the loan
  • Such a loan is ideal for short-term courses and vocational courses

Eligibility Criteria

Having answered the query 'can a student get a Personal Loan', let us look at the eligibility criteria to qualify for t. It is as under:

  • You must be aged between 21 and 63
  • You need to show a minimum work experience of one year
  • Your credit score should be above 750
  • If you are self-employed, you need to provide your proof of income through filed tax returns
  • If you are employed, you need to show your salary slips and bank statements
  • Must meet the minimum salary criteria of the lender

Documentation Required

While applying for a Personal Loan, you need to provide the following documents:

  • Age, ID and address proof documents such as PAN, Aadhaar, Driver's License, Passport, Voter's ID, Employee ID card, etc.
  • Salary slips in case of employed applicants
  • Bank account statements for three months
  • Two recent passport-sized photographs
  • Business registration certification and audited financial statements for self-employed applicants

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Points to Remember before applying

You need to keep in mind a few things before you proceed to apply for a Personal Loan. Here’s what you need to remember.

1. Estimate the right amount

Education can be expensive, and besides the tuition cost, there are additional costs you may have to incur. Do not forget to include the same in your loan for study purposes application. Consider the cost of travel, cost of study materials, etc. It will help plan your expenses in a better way, and you will be able to estimate the right amount. Overestimation or underestimation may not serve the purpose.

2. Choose the suitable repayment tenure

You have the freedom to choose the repayment tenure, but you should avoid keeping it too long or too short. If the term is concise, it could lead to a sizeable monthly outflow, and if it is very long, it will lead to high-interest outgo and increase the overall cost of borrowing.

3. Check the rate of interest

It is essential to check the interest rate and the other costs of borrowing like processing fee or prepayment penalty. If you have a strong credit score, you can enjoy low interest.

Conclusion

Now that you know the answer to - can I get a personal loan as a student, you can apply for the same. The personal loan application process is a hassle-free process, and can be completed with minimal documentation. Once your loan is approved, the bank disburses the loan amount into your bank account directly. You can enjoy tax benefits on interest payment and repay the loan in pocket-friendly EMIs over your chosen tenure.

Download the digibank mobile app on your smartphone, launch the app and click on the 'Get Personal Loan' link on the login page.

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