Education loan which is one of the most important loans for students facilitates easier access to education. As already true to our knowledge, the fee charged by institutes for various courses is quite lofty and hence, students choose to opt for education loans like Allahabad bank education loan to ease their study process.
However, a crucial point to observe is to have a proper check on the list of documents that are required for getting an education loan. With so many schemes and banks to choose from for getting an education loan it is necessary to be aware of the documents which one would need for a loan and pan card is the most important document among them all. Let us have a closer look at the list of the important documents required to get an education loan.
PAN card is the most important document to be submitted for getting an education loan. Indian banks have made it mandatory for students as well as parents to submit their PAN card details for applying to education loans. One of the biggest reasons behind asking PAN card details is the risk of increasing number of defaulters.
PAN card also makes it easier to assess the income of borrowers. Every individual is required to provide their PAN number even while receiving their salaries and hence PAN contains all the financial details of individuals. Thus, assessing the income of parents or co-borrowers becomes easier through PAN card details and frauds can be prevented if parents try to misguide the bank by providing wrong income details. CIBIL reports are also generated using PAN card details, so if someone defaults an education loan this will get reflected in CIBIL report and it gets very tough to get any other loan from some other bank in future.
Apart from PAN card, there are other important documents also which need to be submitted for getting an education loan.
Before giving loans every bank wants to know about their customers and hence, they take utmost care to ensure the authenticity of borrowers. ID proofs are therefore very important and scrutinised strictly before loan processing. Students or borrowers need to have a valid ID proof for getting a student loan. Acceptable valid identity proofs can be one among the following:
- Voter ID card
- Aadhar card
- PAN card
- Driving license
- Government department ID card etc
- Employee ID (if working)
It is important to know where the borrower resides so that incase if the loan goes in default, bank would know where to catch hold of customers. The commonly acceptable residence proofs are:
- Existing house lease statement
- Telephone/ Mobile bill
- Latest electricity bill
- Voter’s ID card
- Bank account statement
- Ration card
Banks also need duly-filled application form along with the signature of student and co-borrowers.
Passport Size Photographs
Customers have to provide 2 passport size photographs of borrowers as well as co-borrowers.
Letter of Admission
Students are required to obtain letter of admission from the institute where they are willing to seek admission on the letterhead of the institute along with the address of institute.
Students are also required to provide some important academic records for the education loan which include:
- 12th Board mark sheets
- Mark sheet/certificates of further education- like graduation and post-graduation (if any)
- Scorecard/Mark sheet of any entrance examinations taken up by student (if applicable)
- Scholarship documents (if any)
Fees Schedule of the Institute
Students are also supposed to provide proper fee breakup of the educational program to which they are applying. The can collect this fee schedule from the corresponding institute which contains the tuition fees, term-wise/semester-wise, year wise fees, and any other miscellaneous expenses like hostel fees etc.
Students are also required to provide a proper age proof for submitting an application form for education loan. They can provide either birth certificate or 10th class board examination mark sheet for the same.
Affidavit or Declaration Form
The bank also asks for an affidavit or declaration form stating that the borrower has not availed any loans from any other banks or financial institutions.
Bank Account Statement
For an education loan, banks also require bank account statement/pass book statement of past 6 months of the student or co-borrowers and guarantor.
Customers also have to submit proof of their income to the bank before getting the loan. In case of salaried individuals, the student or co-borrower has to submit salary slips of last 3 months on the company’s letterhead. Apart from this they also have to submit Form 16 and IT returns filed in last 2 years.
In case of self-employed individuals, they have to show last 2 years IT returns signed and verified by a CA along with P&L statements. They should also show some office proof like lease deed, title deed or utility bill.
VISA/ Travel Papers (For Abroad Loans)
For students who wish to avail education loans to study abroad, they are also required to submit their visa approval and all other papers related to travel details. Students going to US are also required to submit I-20 forms.
Top Banks providing education loans
We have broadly mentioned above about all the important documents needed for applying to an education loan. Some of the top banks which students can consider for taking up education loan are:
- State Bank of India (SBI)
- Axis Bank
- HDFC Bank
- Punjab National Bank
- Canara Bank
- Bank of Baroda
- ICICI Bank
- Oriental Bank of Commerce
- Dena Bank
- Indian Overseas Bank
- Indian Bank
- Andhra Bank
Apart from banks even financial institutions like Credilla and Avanse financial services provide student loans.