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Completing 12th is an important milestone in a student’s life. After this, students want to pursue graduation. But with rising education costs, pursuing higher education is not so easy for many students. But you need not worry, as an education loan can be helpful in fulfilling your dream to pursue education after 12th.
This loan will cover all necessary expenses like tuition fees, hostel fees, books, examination expenses, etc., to pursue higher studies after 12th. This will reduce your financial burden and help you focus on studies without worrying about expenses.
In this blog, we walk you through the process of how to get an education loan after 12th, which will help you make the right decision.
An Education loan after 12th is a type of loan taken by a student to finance their education after completion of secondary school. This loan can be taken for undergraduate degree programs, professional courses, diploma courses or other job-oriented programs.
The student is the primary borrower in an education loan. A parent or guardian is also mostly included in the loan and is considered a co-borrower. The loan repayment starts after completion of the course or after the student starts earning.
An education loan has several benefits which makes students opt for it. Here are the major benefits of an education loan after 12th: -
An education loan ensures that a student’s dream to pursue higher education doesn’t remain unfulfilled due to financial limitations. It helps students from all economic backgrounds to follow their educational path.
It reduces the financial burden of students. They don’t have to worry about education expenses.
The loan covers various expenses like tuition fees, hostel fees, examination fees, books, laptops, and other living or travel expenses.
An education loan comes with a flexible repayment option. Students can start repaying the loan after completion of studies or after securing employment. This reduces their burden during the study period.
Education loans have lower interest rates as compared to other types of loans. This makes it quite affordable for students and their families.
With regular payments of education loans EMI, students can build their credit score. This is quite beneficial and helps them in getting a loan in future on better terms.
Students can give 100% focus on their studies. They don’t have to worry about expenses incurred in pursuing education.
You have completed 12th, and now you are thinking about how to get an education loan after 12th. Then here are the eligibility criteria required to get an education loan: -
Mostly, the following courses are eligible for an education loan after 12th: -
Secured education loans are education loans with collateral. To avail this loan, you will have to pledge collateral as security. Collateral can be any tangible asset like a house, apartment, non-agricultural land or shop. It can also be an intangible asset like a life insurance policy, stock, bonds, mutual funds, etc. If you default on an education loan, then the lender can legally claim the collateral and recover the outstanding amount.
Unsecured education loans are loans which do not require collateral. The interest rates of these loans are higher as compared to secured loans, and the loan amount can have a limit. These loans carry higher risk for the lender. They are evaluated based on the borrower’s and co-signer’s creditworthiness, income and academic background.
The following documents are required for an education loan after 12th: -
The following expenses are covered under an education loan: -
Here is the application process that one needs to follow: -
First of all, you need to secure admission in an eligible course and institution. So, check if the course you are applying for is recognized and if it qualifies under the lender’s education loan scheme.
Calculate tuition fees, accommodation fees, books, equipment, travel and other expenses. This helps you to get a rough estimate of the total amount you need to borrow.
There are various banks and NBFCs offering education loans. Research about them and compare their interest, repayment tenure, moratorium period, and eligibility criteria.
Depending on your financial needs, academic profile and eligibility criteria, you need to shortlist the lenders that fulfill your needs.
You should be prepared with the required documents, which include academic records, identity proof, income documents of the co-applicant, etc.
Go to the lender’s website and fill in the application form online. You can also visit the nearest branch and submit the application form.
The lender will check your documents and eligibility. They may talk to you and can ask for a few more documents.
After verifying the loan application, the lender will approve your loan and issue a loan sanction letter. The loan amount will be disbursed as per the agreed loan terms.
Before signing the loan agreement, you need to consider the following things: -
Check what the interest rate being offered is because it will decide how much total amount you repay.
Check when the repayment is going to start. Also check if the interest is going to be charged during the study and moratorium period.
Check the collateral required by the lender. Some education loans may require collateral.
Some loans can ask for a certain margin amount that needs to be contributed by the borrower. You should be aware of these requirements.
A longer repayment period will have a lower monthly EMI, but it can increase the total interest.
Choose the loan amount as per the education needs. Don’t borrow more than the requirement.
The majority of students in India who complete 12th have the common query that “how to get an education loan after 12th”. An education loan helps these students pursue higher education without worrying about financial constraints. These loans are available for different types of courses. This loan comes with a lot of benefits like low interest rates, flexible repayment options, and covers multiple expenses.
In order to apply for an education loan, you have to fulfil the eligibility criteria. Moreover, you should be prepared with the required documents so that the loan process is not delayed. It’s advisable to research various lenders and compare them to get the best loan offer.
Yes, students who have completed 12th can apply for an education loan. But they should have secured admission in a recognised university or college. The lender will assess the course, institution, co-borrower, documents and other eligibility criteria.
There is no such fixed minimum percentage requirement to get an education loan. The eligibility criteria for the loan can vary among different lenders. Most of the financial institutions check overall academic performance, course quality, institution reputation and co-applicant financial profile.
Education loans after 12th are available for courses like undergraduate degrees, professional courses, diploma courses, vocational courses, and other job-oriented courses.
Yes, the majority of lenders ask for a parent or guardian as a co-applicant in an education loan. This is to ensure that the loan is repaid, as most students don’t have independent income.
Yes, you can get an education loan without collateral after completing 12th. Indian banks offer collateral-free loans up to ₹7.5 lakh under standard schemes and up to ₹10 lakh via government initiatives like PM-Vidyalaxmi.
The repayment period of an education loan after 12th can vary from 10-15 years. However, this can vary depending on the loan amount and the lender’s policy.
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