The Buyt Desk
The cost of education is rising every year, but the lack of resources has never hindered the way of education seekers and will not do it even today and in the coming time. Students with not sufficient funds or those that are self-reliant have the option of loans, especially the education loan. We discuss the process of getting an education loan and the documents you must have to apply for the loan.
Documents Required to Apply for Education Loan
Education loan is just like any other loan borrowed from a bank. Therefore, the borrower has to submit certain documents to the lender so that lender gets to know the borrower. Although different banks have different documents requirement, except a few, most are the same. These are –
Know Your Customer Document – The documents like Aadhar card, driving license, and PAN card is used for the purpose.
Address Proof – The address proof must be the latest. The applicant can submit the Aadhar card, water or electricity bill, voter ID card, house agreement paper, passport, etc., as address proof.
Proof Of Academic Qualification – The academic certificate of 10th and 12th standards are the basic. Along with that, the documents required are, applicant need to submit the result of his last academic qualification issued by the educational institutions and the competitive exam result.
Admission Proof – The applicant also has to submit proof of admission to the institute for which he is applying for the loan.
These are the documents a loan applicant has to submit. While taking an education loan, the applicant does not have a source of income, thus, the loan requires a co-applicant. Co-applicants act as a guarantor in education loans. A co-applicant can be a parent, guardian, or any other person having a source of income.
The lending bank requires documents of the co-applicant as well. The documents include,
When the Applicant Is Salaried
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Income proof for the last three months.
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IT returns of 2-3 months or the copy of Form 16. All these documents must be acknowledged by the income tax department.
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Co-applicant’s bank account statement for the last six months.
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Details of co-borrower liabilities and assets.
When the Applicant Is Self-employed
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Proof of his business address.
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16A form (TDS Certificate).
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The last two years IT returns (If the applicant pays tax).
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If the applicant is a professional, then his professional certificate like doctor, lawyer, CA, etc.
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Six months bank statement of co-applicant.
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Details of co-applicant liabilities and assets.
Education loan is an unsecured loan, which means the borrower does not have to keep collateral for the loan. However, it is only up to a threshold of Rs7.5 lakh. If the loan amount is more than the threshold, then the education loan also needs to be secured by collateral. In that case, the applicant has to submit certain documents for collateral as well. It includes:
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Ownership of property.
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Receipt of registration.
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Allotment letter.
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Address proof, such as tax copy, electricity bill, etc.
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Approved building plan by the government.
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Completion certificate, OC, etc.
These are the documents most education loan lending banks require. Besides this, some banks might ask for a few more documents which are not difficult to produce when you have these in hand.
