The students looking to pursue higher education in foreign countries face many hurdles on their way. Most middle-class families in developing countries face numerous hurdles like lack of opportunity, lack of exposure, lack of experience, lack of courage when they think about studying abroad. However, the biggest problem for most families is financial problems.
The parents spend almost all their life’s savings to make their child graduate from an eminent university. If the child decides to move abroad for further education, that poses a major threat to the family’s economic condition. On that note, here are five tips that can help you prepare financially for foreign education –
Compare various university fees with your budget
There are a lot of excellent universities across the world offering world-class education. Many of them do not even charge astronomical fees. So, if you want to pursue higher education from foreign universities, start by making a list. The list must contain the details of the universities with their respective fee structures.
In this way, you can compare all your preferred colleges and universities at once. Thus, you can easily choose which college will be perfect for you both in terms of affordability and education. Click Here – Edit my paper
Check your eligibility for an education loan
The most convenient way to fund your foreign education is through an education loan. However, getting an educational loan is not as simple as it seems. You first need to be eligible to get an educational loan.
Here are the steps that you need to follow to get a loan.
- You need to be an adult to get a loan. If you are not an adult, you can still opt for the loan, but in the name of your parents. However, you will be disqualified from getting an educational loan if you are above thirty-five.
- The applicant needs to present the mark sheet proving you have the required marks for qualifying.
- The applicant must have the admission confirmation letter for the college you are trying to get in. Banks also demand collateral security against the money they are lending.
- The banks also prefer students to have a co-applicant while applying for the loan. For example, they can be your parents or your sibling.
The terms and conditions of the eligibility criteria differ in every bank. So, it is advisable to do your bit of research before knocking on the bank’s doors for an education loan.
Make guarantor and collateral for financial security
This might need to be done depending on the type of loan you are seeking. You can either opt for an unsecured loan or a secured loan. If you want to get an unsecured loan, banks will ask you for a third-party guarantor or some collateral before granting you an educational loan. This is because the banks undergo a lot of risks while granting a loan. So, the larger the loan amount is, the larger collateral banks look for.
You can present your property documents, gold, equity shares, or fixed deposits as collateral. For a guarantor, the students need to have a trustworthy person by their side. Not everyone can be a guarantor in the eye of the bank. The bank has specific guidelines to decide if the specified person is fit enough to be a guarantor. They must be –
- An adult
- Citizen of the same country
- Have good credit scores
- Do not have any other loans or debts on him
- Must have sufficient income to cover the loan repayments
Choose the right bank for an education loan
Experts advise the students to get their education loans from reputed banks. If somehow you are not eligible for a bank loan, the next option must be NBFC. Non-Banking Financial Corporations also provide education loans with much lesser qualifying criteria. Although their interest rate is slightly higher than the banks, it is still offset by lesser documentation.
Still, before choosing any bank or NBFC, you must always check and compare the essential details like –
- Interest Rate
- Maximum loan allowed
- Processing Fees
- Maximum tenure permitted
- Margin money needs
- Approval time
- Processing time
- Moratorium Period
Be alert about paying the margin money
Bank asks the customers to pay a certain amount as margin money before the disbursal of the loan amount. This margin money is a certain percentage of the total education loan amount that the students need to pay upfront. This money needs to be paid out of the student’s pocket. Then, the bank pays the remaining amount in the form of a loan.
This can differ from bank to bank based on university, loan amount, tenure, etc. Banks usually ask for lower margin money if the university is reputed. Banks usually charge a margin money rate of approximately 5% to 15% of the total fund requirement. So, if you are planning that you want to go for higher education in a foreign university, plan ahead. The best way is to make recurring deposits well in advance to accumulate enough money to pay the margin amount while taking the loan.
Many students have the dream to study abroad. However, the first and major roadblock they face is the financial hurdle. The cost of studying in a developed foreign land is significantly higher than in any developing country. But that must not mean the end of your dreams. Instead, you must be planning early to ensure that you have enough funds to finance your dreams of pursuing higher education from abroad. Do not wait for the time you are clearing your entrance exams. Plan well ahead and make savings to leave you with sufficient funds to pay the margin money once you get the education loan. Follow the rest of the tips to have a seamless experience of arranging funds to give wings to your dreams of studying abroad. Click Here – Paper help
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