Education Loan for Indian Education Fees & Charges

Rates offered to customer during the period of July'24 to Sept.'24

Annual Percentage Rate offered to customer during the period of July'24 to Sept'24

Here are the Education Loan interest rates offered by HDFC Bank:

Interest to be charged at rates linked to the External Benchmark Lending Rate as decided by individual banks. Banks may charge differential interest rates for collateralised and non-collateralised loans. It will also be open to banks to offer differential interest rates based on rating of courses/ institutions or even students.

Simple interest to be charged during the study period and up to commencement of repayment. Simple interest may be charged even during any subsequent moratorium considered.

Note: Servicing of interest during study period and the moratorium period till commencement of repayment is optional for students. Accrued interest will be added to the principal

while fixing EMI for repayment.

Below are the key factors that affect Education Loan EMIs:

• Loan Amount: The amount you borrow influences your EMIs. A larger Loan amount will typically result in higher monthly instalments, whereas borrowing a smaller amount will lead to lower EMIs.

• Interest Rate: The Education Loan interest rate is a key factor in determining your EMI.

• Loan Tenure: The repayment period or tenure significantly affects the EMI. You can opt for either a short or a long tenure.

• Prepayment or Part-payment: If the borrower makes prepayments or part-payments during the loan tenure, it reduces the outstanding principal. Prepayment then consequently lowers the EMI or shortens the loan tenure. No prepayment penalty will be levied for prepayment of loan any time during the repayment period.

• Moratorium Period:

1. Repayment Holiday / Moratorium: Course period + 1 year.

2. Repayment of the loan will be in equated monthly instalments for a period of 15 years for all categories (excluding course and moratorium period).

Here are key factors to keep in mind before taking an Education Loan:

• Loan Amount: Evaluate the total funding required for your education by assessing tuition fees, living expenses and any additional costs. Need-based finance to meet the expenses will be considered by the banks taking into account minimum margins. While assessing the quantum of finance, banks ensures that a student is neither over financed nor under financed. Banks may consider the government scholarships or scholarships from any source are credited to the loan account, if the scholarship amount was not netted off while fixing quantum of finance. Banks may also consider capping Education Loan amount (stream wise/ institution wise) by taking into account reputation and placement history of the education institution concerned.

• Interest Rates: Look for both fixed and floating rates and understand how they affect your EMI.

• Repayment Tenure: Evaluate the Loan tenure offered. Choose a tenure that balances manageable monthly payments with total interest costs.

• Processing Fees and Charges: Review any processing fees, legal charges or other costs associated with the Loan.

• Eligibility Criteria: Ensure you meet these criteria to avoid delays in Loan approval.

• Impact on Credit Score: Understand how taking an Education Loan may affect your credit score. Timely repayments can improve your score, while defaults can harm it, affecting your future borrowing ability.