Education Loan in Telangana

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Education Loan in Telangana

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Brinda Khurana
Brinda Khurana
Updated on:  25 Jul 2024  | Reviewed By: 
Aman 
| 140 | 14  min read

If you reside in Telangana and are looking to secure a student loan for your studies either within India or internationally, this information is pertinent to you. Typically, students from Telangana require about INR 15 lakhs for local studies and up to INR 45 lakhs for education abroad. The interest rates for education loans in Telangana vary between 8.30% and 13.5%, depending on the loan type and the lender. More detailed information is available below.

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Which Bank is Best for an Education Loan in Telangana?

In Telangana, students can access education loans from multiple banks for both local and international educational pursuits. It's important for students to carefully compare the different loan options available, considering factors like interest rates, repayment terms, and additional benefits. It's advisable to thoroughly explore the various offerings from these public sector and private sector banks as well as NBFCs to find an education loan that best suits your educational and financial requirements.

 

Leading Banks for Education Loan in Telangana For Studies in India 

Bank Name  Loan Amount  Processing Fee

State Bank of India 

Up to INR 50 lakh

Nil - INR 10,000+Tax 

Axis Bank 

Up to INR 75 lakh (unsecured) 

Up to 2% of the amount+GST 

ICICI Bank 

Up to INR 1 crore 

Up to 2% of the amount +GST

IDFC First 

Up to INR 30 lakh (unsecured) 

Up to 1.5% of the amount 

UBI 

Up to INR 1.5 cr (secured) 

Up to INR 40 lakh (unsecured)

INR 5000 (refundable) 

HDFC Credila 

Up to INR 40 lakh 

1% + GST 

Auxilo 

Up to INR 65 lakh 

Up to 2% of the sanctioned loan amount 

InCred 

Up to INR 60 lakh

0.75% - 1% of the sanctioned loan amount

BOB 

INR 7.5 lakh - INR 1.5 cr 

1% (max. INR 10,000) 

Check Your Education Loan Eligibility

Leading Banks for Education Loan in Telangana for Abroad Studies

Bank Name  Loan Amount  Processing Fee

State Bank of India

Up to INR 1.5 cr with collateral 

INR 10,000

Axis Bank

Prime A - INR 1 cr

Prime B - INR 40 lakh 

0.75% on the sanctioned loan amount 

ICICI Bank 

Up to INR 2 cr (secured) 

Up to INR 1 cr (unsecured) 

Up to 0.75% TO 1% + GST 

IDFC First Bank

Up to INR 75 lakh without collateral 

Up to 1.5% of the sanctioned loan amount 

Union Bank of India 

Up to INR 2 cr (secured) 

Up to INR 40 lakh (unsecured) 

INR 5000

HDFC Credila 

Up to INR 75 lakh 

0.5% - 1% 

Avanse 

Up to INR 75 lakh 

1% - 1.5% 

Auxilo 

Up to INR 65 lakh 

0.5% - 1.5% 

InCred 

Up to INR 80 lakh 

1% - 2% 

MPower Financing

Up to 100,000 USD 

5% (adjusted in the loan amount) 

Prodigy Finance 

Up to 100% cost to study 

Up to 5%, added to loan amount*

Bank of Baroda 

Up to 1.5 cr with collateral 

INR 10,000 + GST 

*Note: Upon loan approval, students are required to pay an upfront fee of $100 to receive their sanction letter.

 

Explore Best Banks for Education Loans!

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What are the Documents Required for an Education Loan in Telangana ?

A clear and concise outline of the basic documentation required for an applicant and co-signer when applying for an education loan:


For the Applicant and Co-signer

  • list items Loan Application Form: Must be fully completed, signed, and accompanied by two photographs.
  • list items Proof of Address: Options include Voter ID, telephone bill, electricity bill, ration card, bank account statement, or Aadhar card.
  • list items Proof of Identity: Required documents are a PAN card and passport.
  • list items Personal Asset and Liability Statement: Should be provided in the bank's specified format, completed by a banking professional.
  • list items Bank Statements: The latest 6-month bank statement, either salary or personal. For self-employed co-applicants, provide one year’s worth of company transaction statements.
  • list items Self-Attestation: All documents must be self-attested by both the applicant and the co-signer.
  •  

    Applicant Academic Documents

  • list items Proof of Admission/Enrollment: Document should confirm the total duration of the program.
  • list items Course Fee Structure: Include the I-20 form if applying for studies in the USA.
  • list items Standardized Test Scorecards: GRE, IELTS, or GMAT results.
  • list items University Ranking: A printout of the university's ranking.
  • list items Educational Mark Sheets and Certificates: Include documentation from 10th, 12th grades, and any degrees.
  •  

    Income Documents of Financial Co-signer

     

    1. For Salaried Individuals:

  • list items ITR for the last two years.
  • list items Employer's identification card.
  • list items Form 16 from the previous two years.
  • list items Recent pay slips (last 3 months).  
  •  

    2. For Self-Employed Individuals:

  • list items ITR for the past three years.
  • list items Three-year balance sheet and P&L account.
  • list items Proof of business address.  
  •  

    3. Other Required Documents

  • list items Processing Fee: It is different for all the banks and NBFCs. .
  • list items Financial Responsibility Letter: States that the co-applicant will cover any costs not met by the loan.
  • list items Legal and Evaluation Fees: Cheques for attorney and evaluator fees if the bank handles your legal and valuation processes.
  • list items Affidavit: From the collateral property owner(s) on Rs. 100 stamp paper. If multiple owners exist, each must provide an affidavit.  
  •  

    4. Additional Documentation

  • list items Existing Loan Statements: From the previous year, if applicable.
  • list items Receipts for Advance Payments: For any upfront payments made.
  • list items Proforma Invoice: If requesting funds for specific items like a trip or laptop.
  • list items Explanation Letter: If the co-applicant lacks ITRs or if there is a gap in the applicant's academic or professional profile.
  •  

    This comprehensive list ensures you are prepared with all necessary documentation when applying for an education loan, streamlining the process and enhancing the likelihood of approval.

    Check Your Education Loan Eligibility

    Documents Required for a Secured Loan in Telangana 

    When securing an education loan in Telangana with immovable property as collateral, certain specific documents related to the property are required. Here’s a breakdown of the necessary collateral documents:
     

    1. Title Deed: The deed confirming the ownership of the property you are pledging as collateral.
     

    2. Legal Documents: Includes any Gift Deed, Sale Agreement, or Will that has been formally registered.
     

    3. Registration Receipt: The original receipt for the registration of the aforementioned legal documents.
     

    4. Allotment Letter: Issued by the municipal corporation or an authorized government authority, confirming the allocation of the property.
     

    5. Chain of Title Documents: A 30-year history is essential, showing the chain of ownership or Encumbrance Certificate (EC). If the property has been in your possession for more than 30 years, the previous sale deed will suffice.
     

    6. Recent Utility Bills: Include up-to-date electricity and property tax bills that correspond to the address of the pledged property.
     

    7. Approved Building Plan/Plot Layout: A copy of the building plan or plot layout approved by the municipality.
     

    These documents are crucial for verifying the legality and valuation of the property used as collateral for an education loan, ensuring the lending institution has all the necessary information to proceed with your loan application.

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    What Collaterals are Acceptable in Telangana for Education Loans?

    When applying for a secured education loan in Telangana and using property as collateral, there are specific types of properties that are acceptable, along with certain conditions and additional requirements:

     

    Types of Acceptable Collaterals

     

    1. Residential Properties: This includes houses, flats, and non-agricultural lands with clearly defined boundaries.
     

    2. Commercial Properties: Buildings or lands zoned for commercial use.
     

    3. Agricultural Land: Farmland that can be mortgaged under certain conditions.
     

    4. Financial Securities: Fixed Deposits (FDs), life insurance policies with a surrender value, and government bonds.
     

    Additional Documentation and Specifications for Telangana

  • list items Land Regularization Scheme (LRS): Necessary for open plots, this scheme helps in regularizing unapproved plots.
  • list items Building Regularization Scheme (BRS): Required for properties that have been built up, this scheme aims to regularize unauthorized constructions.
  • Exceptions and Non-Acceptable Collaterals

  • list items Notarized Properties: Properties that are only notarized and not fully registered with appropriate government authorities are not accepted as valid collateral.
  • list items Government-Assigned Properties: Properties assigned by the government, often for specific purposes or to certain groups, cannot be used as collateral.
  • list items Cantonment Properties: Properties located within cantonment areas are typically under strict military control and cannot be pledged as collateral.
  •  

    These specifics are crucial for ensuring that the property pledged meets the legal and regulatory standards required by banks and financial institutions in Telangana for securing an education loan. This information helps to streamline the process and prevent delays in loan approval.

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    Education Loan Interest Rate in Telangana for Studies in India

    Bank Name  Interest Rate  Interest Rate Concession 

    State Bank of India 

    Starts from 8.30% 

    0.60% Business strategy discount 0.50% - for female students 

    0.50% - Rinn Raksha 

    Axis Bank 

    Starts from 11.5% 

    0.5% - 2% 

    ICICI Bank 

    Starts from 10.5% -11% 

    0.5% - 2% 

    IDFC First 

    Starts from 8.5% - 10% 

    0.5% - 2% 

    UBI 

    Starts from 11.15% 

    0.5% for female students

    1% if the SI is paid in full 

    HDFC Credila 

    Starts from 10.25% - 12.75% 

    -

    Auxilo 

    Starts from 11% - 13.5% 

    0.5% - 2% 

    InCred 

    Starts from 11% - 13.5% 

    0.5% - 2% 

    BOB 

    Starts from 8.85% 

    0.5% 

    Calculate your Education Loan EMI

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    Education Loan Interest Rate in Telangana for Studies in Abroad

    Bank Name  Interest Rate  Interest Rate Concession 

    State Bank of India 

    Starts from 10.15% 

    0.5% concession in interest for female students 

    0.5% - Rinn Raksha 

    Axis 

    9.99% - 12.5% 

    -

    ICICI 

    10.25% - 12.5% 

    -

    IDFC First 

    9.5%-11% (secured) 

    11%-13% (unsecured) 

    -

    UBI 

    9.25% - 9.75% 

    -

    HDFC Credila 

    10.25% - 12.75% 

    -

    Avanse 

    10.75% - 13% 

    -

    Auxilo 

    11.5% - 13% 

    -

    InCred 

    11.85% - 13.25% 

    -

    MPower 

    12.99% - 15.99% 

    -

    Prodigy 

    11.5% - 13.5% 

    -

    BOB 

    9.7% (fixed) 

    0.20% concession in interest for female applicants of non-premier institutes

    Verify your eligibility for an education loan with GyanDhan today! Simply visit the GyanDhan website, use their loan eligibility tool, and receive instant feedback on your options. 

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    What is the Eligibility Criteria to Avail an Education Loan?

    To qualify for this education loan scheme, applicants must meet specific eligibility requirements:
     

    1. Parental or Guardian Representation: A parent or guardian must act as the co-borrower for students who are minors, ensuring legal and financial responsibility.
     

    2. Joint Loan Agreement: The loan will be issued in the names of both the student and the parent/guardian, linking both parties to the financial commitment.
     

    3. Admission Through Merit: The student must have secured admission to a recognized institution either in India or abroad, based on merit through a competitive selection process.
     

    These criteria are designed to ensure that the loan is used for legitimate educational purposes and that there is adequate financial backing to support the student's academic journey.

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    What are the Benefits of Availing an Education Loan in Telangana?

    When considering an education loan from banks or NBFCs in Telangana, it's essential to understand the kinds of expenses that can be covered, as well as various loan terms like the moratorium period, loan margin, and collateral margin. Here’s a detailed overview:

     

    Expenses Covered by Education Loans

    Education loans typically cover a comprehensive range of expenses that are essential for completing your education smoothly, whether domestically or abroad. These include:

  • list items Tuition Fee: The primary expense for any educational program.
  • list items Accommodation Fee: Costs associated with housing either on or off campus.
  • list items Examination Fee: Fees for exams over the course of the study period.
  • list items Library Fee: Charges for using the academic institution’s library resources.
  • list items Laboratory Fee: Fees for using the laboratory facilities for science and technology courses.
  • list items Cost of Books: The required textbooks and other study materials.
  • list items Miscellaneous Expenses: Other necessary expenses related to education.
  • list items Travel Tickets: For students studying abroad, the initial travel costs are covered.
  • list items Insurance Premium for Applicant: For students going abroad, this can also include health and travel insurance.
  •  

    Moratorium Period

    The moratorium period is a crucial feature of education loans, allowing the borrower some breathing room before beginning repayment:

  • list items Public Banks: Typically offer a moratorium period of the course duration plus six months to one year, with simple interest charged on the loan amount during this period. Payment of this interest is not mandatory during the moratorium.
  • list items Private Banks: Compound interest accrues during the moratorium period and must be dealt with when repayment begins.
  • list items NBFCs: Generally require payments towards EMIs during the moratorium period, which can include both principal and interest.
  •  

    Loan Margin

    This is the portion of the total loan amount that must be funded by the borrower:

  • list items Public Banks: Generally have a loan margin of about 10%.
  • list items Private Banks: The loan margin can vary between 5% and 10%, depending on various factors including the borrower’s financial background and the specifics of the loan product.
  •  

    Collateral Margin

    In the context of secured loans, this refers to the portion of the loan amount that is secured by collateral:

  • list items Usage of Collateral: If the borrower defaults on the loan, the banks use the collateral to recover the outstanding loan amount. The specific terms of how much of the loan amount needs to be covered by collateral can vary significantly between different lending institutions.
  •  

    Understanding these details helps ensure that applicants are well-prepared and can plan their finances accordingly when applying for an education loan in Telangana.

    Calculate your Education Loan EMI

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    What are the Common Reasons for Education Loan Rejection in Telangana?

    When students directly approach lenders for an education loan, they often encounter challenges that can lead to rejection. Understanding these reasons can help applicants better prepare for successful loan applications. Here are some common reasons why banks may refuse to sanction a student loan:

     

    1. Poor CIBIL Scores

  • list items Impact: A poor CIBIL score of the co-applicant or financial co-signer can lead to loan rejection. This score reflects the creditworthiness and repayment history, which is crucial in the bank's decision-making process.
  • list items Standard Requirement: Most banks require a minimum CIBIL score of around 685. However, some banks like the State Bank of India (SBI) might approve loans for scores as low as 591.
  •  

    2. Poor Academic Scores

  • list items Relevance: Banks consider the academic performance of applicants as an indicator of potential success in higher education and subsequent employability. Poor academic records may suggest a higher risk of non-completion of studies and hence, financial risk.
  •  

    3. Chosen Country for Higher Studies

  • list items Preference: Some banks have preferences or restrictions regarding the countries they consider viable for funding education. They often exclude third-world countries, perceiving a higher risk in the return on educational investment due to lower employability rates or political instability.
  •  

    4. Chosen Course for Higher Studies

  • list items Field of Study: Banks typically favor funding education in STEM (Science, Technology, Engineering, and Mathematics) fields over other areas. This preference is based on the perception that STEM fields offer better job prospects and financial stability post-graduation, reducing the risk of loan default.
  •  

    5. Insufficient Documentation

  • list items Documentation Requirements: Proper and complete documentation is crucial for processing education loans, especially for studying abroad. Banks need thorough documentation to assess the applicant's eligibility, financial stability, and academic background. Missing or incomplete documents can halt the entire process.
  •  

    Understanding these factors can equip potential borrowers to address the areas of concern before applying for a loan, thereby increasing their chances of approval. Preparing thoroughly, improving credit scores, ensuring strong academic performance, and selecting recognized courses and countries for higher education are strategic steps to counter potential reasons for loan rejection.

     

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    Conclusion 

    In conclusion, securing an education loan in Telangana or Telangana involves a comprehensive understanding of various elements, including the types of expenses covered, the applicable interest rates, and the specific requirements for documentation and collateral. Prospective borrowers must navigate these aspects carefully, considering their chosen field of study, the destination country for education, and their financial and academic background to enhance their chances of loan approval. It is also vital to choose the right bank or financial institution, as each has different terms and offerings that could impact the overall benefits of the loan.

     

    In Telangana and exploring education loan options? GyanDhan is your go-to platform, offering a pathway to secure financing for your higher studies in India or abroad. Our education loan experts help you in securing high loan amounts under favourable terms with a track record of higher loan approval rates. We also assist with pre-visa loan disbursement, crucial for your visa application. Best of all? Our expert, end-to-end service comes at absolutely no extra cost to you. Check your loan eligibility on GyanDhan now and take the first step towards realizing your academic dreams.

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    Frequently Asked Questions 

    Are there any special concessions available on education loans in Telangana?

    Yes, many banks offer interest rate concessions for female students, merit-based admissions, and for students opting for insurance like Rinn Raksha. Checking with individual banks for specific concessions is advisable.

    What should I do if my education loan application is rejected in Telangana?

    First, understand the reasons for rejection, which could include poor credit history, insufficient income proof, or inadequate documentation. Address these issues and consider applying with another lender or opt for a secured loan if possible.

    How long does it take to process an education loan in Telangana?

    The processing time can vary from one bank to another but generally ranges from a few days to a few weeks. Ensuring that all required documents are complete and accurately provided can help expedite the process.

    Can I prepay my education loan without any additional charges in Telangana?

    Most banks allow prepayment of education loans without any penalty after the moratorium period. However, it's important to check the specific terms with your lender as policies can vary.

    How can GyanDhan assist me in getting an education loan in Telangana?

    GyanDhan offers a platform to compare different education loan options, check loan eligibility quickly, and get personalized assistance throughout the loan application process, ensuring you get the best terms possible without any additional cost.

    Check Your Education Loan Eligibility