Education loan on property is one of the most sought after financial product taken to avail fund for higher education in premier universities or overseas studies. This scheme allows a customer to avail a loan amount against a collateral. Students can finance their education with a loan against property and avail the required amount without liquidating their savings.
Ideally, you should apply for a credit only when necessary, and after carefully determining your financial requirements. Ideally, you should also determine your repayment capability before availing such advances; financial experts suggest applying for a credit only when a borrower has sufficient time to repay the debt through their source of earning.
Must Read: How To Get A Student Loan Against Property
Other than that, you should also evaluate the current market conditions while availing a credit. With the introduction of MCLR and REPO based lending rates, you can benefit significantly by availing a credit when the market is at a steady condition.
A student loan in floating rate of interest can be availed when the market rate is likely to reduce in the upcoming years so that you benefit from a lower rate of interest. Fixed interest rates usually stay approximately 1% to 2% higher than floating rates.
However, it is advised to avail this type of interest if you prefer planning for your budget as fixed rates allows you to accurately determine your monetary obligations beforehand.
Loan Against Property is considered as a secured loan, as the lender has the provision to forfeit the collateral if the borrower falters at any stage. That’s why you should only apply a credit when you are assured of your repayment capability.
