A medical career is an honorable one that requires commitment, perseverance, and a substantial financial outlay. The expense of earning a Bachelor of Medicine or Bachelor of Surgery (MBBS) degree can be prohibitive for many aspirants to the medical field. To finance their academic goals, students frequently resort to education loans to cover rising tuition fees, living expenses, and other related costs. We will examine the Education Loan for MBBS.
Why take an Education Loan for MBBS?
Given the fee schedule, having adequate money to last for six years is essential. An education loan can support you financially if you struggle to pay for your child’s medical education.
Simply put, taking advantage of an education loan without collateral eliminates the need to provide collateral for the loan. At no time during your education should you be concerned about pledging any assets to obtain a student loan for MBBS.
What is the benefit of an education loan for MBBS studies? Benefits from education loans are numerous. The money from the education loan for MBBS can be used to cover housing and board costs, books and literature purchases, and fee payments.
Types of Education Loan for MBBS
Secured education loans: Collateral security serves as the foundation for the granting of secured education loans. In this case, obtaining an education loan requires the borrower to pledge the collateral to the lender. Immovable property, liquid security, and any third-party collateral (such as homes, land with clearly defined boundaries, fixed deposits, government bonds, etc.) are the three categories of collateral that are accepted as security.
Unsecured education loans: The academic record of the student and the financial standing of their co-applicant are taken into consideration when granting unsecured education loans. In this case, pledging any collateral security is not necessary for students to qualify for an unsecured education loan. As a result, students must closely monitor the eligibility requirements established by the financial institutions.
Eligibility Criteria for Education Loan for MBBS in India
- In India, you have to be between the ages of 23 and 47 to be eligible for an MBBS loan. Parents may apply for an education loan for medical students whose children are enrolled in a medical college.
- The parent who is applying for an education loan for their child’s MBBS must be employed by a private, public, or limited liability company.
- A minimum monthly income of Rs. 25000 is required.
- You must have worked for your current employer for more than three months and have more than six months of total work experience at the time of application for the MBBS education loan.
- To be eligible for an education loan, you must submit two months’ pay stubs as evidence of your income.
- At the time of application, the statement must be submitted, and the salary must be credited to a bank account. You must be able to access your online banking to submit the statement if it is not available.
Secured Education Loan for MBBS Details
To qualify for a secured education loan, students must be able to provide collateral. Different kinds of collateral security, such as homes, apartments, fixed deposits, government bonds, etc., are needed for student loans. Third-party collateral, such as that belonging to your friends, family, uncle, aunt, etc., is also accepted by government banks. Bank representatives typically do not give priority to students who approach them directly to obtain an education loan on third-party collateral. Overall, this causes the application for an education loan to be delayed. Because our processing officer assists you with the entire education loan process, we, therefore, advise students to begin their loan application process through loan providers.
Benefits of Taking a Secured Education Loan for MBBS
- Moratorium period: The repayment holiday is another name for the moratorium period. It is one of the main benefits for students who use government banks to get an education loan. In this case, the student is not required to pay the lender anything at all while the moratorium is in effect.
- Lower interest rates: Interest rates on secured student loans typically range from 8% to 9%, which is lower than that of private banks and NBFCs.
- Affordable Processing Fees: The processing fee for government banks is fixed at INR 10,000, and in certain cases, it is refundable.
- Tax benefit- Section 80E: The education loan income tax exemption is available to both the loan applicant and the co-applicant under Section 80E of the Income Tax of 1961.
When someone wants to work in the medical field, earning an MBBS degree is a big step in the right direction. Education loans are essential to this process because they give students who don’t have enough money a way to continue their education. However, negotiating the difficulties of getting an education loan for MBBS program necessitates giving eligibility requirements, repayment choices, and potential roadblocks considerable thought.