Student Loan for UK: How to Get a Student Loan in UK for International Students? Image
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Student Loan for UK: How to Get a Student Loan in UK for International Students?

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Yocket Editorial Team
16 mins read
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UK is a dream destination for international students planning to study abroad. More than 538,000 students are currently enrolled in UK universities. Remarkably, India is the 2nd top country of origin represented at higher education institutions in UK. If you too are an aspirant seeking admission in UK and feel overwhelmed by the cost of studying in UK then you have landed in the right place. Among various financial aid available for international students, an education loan to study in UK is one of the most popular options.

These days you can avail study loan for UK at low interest rates with flexible payment plans, easy application process, minimal document requirements and timely approval. Get in touch with loan providers to know about interest rates, repayment plans and amount of loan and prepare a budget of your cost of studying in UK. Go through the guide below to explore the cost of studying in UK, eligibility criteria, requirements for student loan UK, expenses covered by the loan, repayment, loans for Indian students in UK etc.

Table of Contents:

  1. Why Do You Need A Student Loan for UK
  2. Eligibility Criteria and Requirements to Secure A Student Loan for UK
  3. How To Get Loan For Students in UK?
  4. Types of Education Loans in UK
  5. Which Indian Banks Provide Student Loan for UK?
  6. What Expenses Are Covered Under Student Loan in UK?
  7. Repayment of Student Loan for UK
  8. Frequently Asked Questions About Student Loan for UK?

 

Why Do You Need a Student Loan for UK?

If you have made up your mind to study in UK, you must be aware that UK is one of the costliest study abroad destinations. The total cost includes the tuition fees for universities, cost of living including accommodation, food, transportation, medical costs and miscellaneous expenses. You may feel financial constraints if you don't have your expenses planned.

Below mentioned are some of the top reasons you can opt for student loan in UK:

  • Interest rates for any loan, such as a home loan, a car loan, a personal loan, and so on, are often greater than on educational loans.  In addition, all Government banks offer a 0.5% discount to female borrowers.
  • Tuition costs, transport (tickets), housing rent, university fees, food expenditures, living expenses, laptop, or any other thing required for your education are all covered by a student loan in UK.
  • Typically, parents liquidate significant assets to cover cost of studying in UK, which disrupts long-term financial plans. When you take out an education loan, banks hold your liquid assets as security, such as FDs, insurance, and government bonds, and issue you a loan based on that security. 

Therefore, an education loan is the best alternative to help you cover all your expenses in a safe and timely manner while fulfilling the admission and visa requirements.

Suggested: A complete breakdown of cost of living in UK for Indian students

 

Eligibility Criteria and Requirements to Secure A Student Loan for UK

Before understanding the process of securing an education loan for UK, let us take a look at the eligibility criteria to get loans for Indian students in UK:

  • You must be a resident of India
  • The age should be between 18 to 35 years at the time of loan application
  • Have confirmed admission to a recognized institution in UK
  • A co-applicant who can either be a parent or spouse is required
  • Co-applicants should have a stable income source


What are the Documents Required to Secure a Student Loan?

In order to apply for a study loan for UK, you will need the following documents to support your loan application:

  • Education loan application form of the bank
  • Proof of admission
  • Identity proof such as Aadhar Card/ Voter ID/ Passport/ Driving License
  • Address proof includes bank statement, rental agreement, ration card, electricity or telephone bill
  • Proof of age such as Aadhar Card/ Voter ID/ Driving License/ Passport
  • Passport-size photographs
  • Proof of income such as salary slips provided at the time of applying for loan
  • Financial documents
  • Mark sheets from the latest examination such as higher secondary examination or graduation results
  • Copy of any scholarship letter
  • A detailed list of expenses for studying your chosen course
  • Borrower’s bank account statement
  • Statement of assets and liabilities of co-borrower

 

How to Get Loan for Indian Students in UK?

If you are wondering whether you can get loans for Indian students in UK or not then the answer is a big yes! You can borrow money to pay for fees and living costs at universities in UK. The eligibility for student finance depends on the university, course, age, nationality and whether you have studied a higher education course. Take a look at the student loan eligibility UK:

  • You can apply online for a student loan UK.
  • You can avail funding through education loan to study in UK up to 9 months after the start of your academic course.
  • The processing time for your application is up to 6 weeks.
  • You will have to submit your proof of identity.
  • Such a loan is repayable once you start earning a stable income.
  • The amount of monthly instalments will also depend on your monthly earnings.

 

Types of Education Loan to Study in UK 

There are mainly 2 types of loans for Indian students in UK,

  1. Collateral Education Loan
  2. Non-Collateral Education Loan

Let us know more about these two types of students loans in UK: 

  1. Secured education loan for UK or secured loan wherein you will have to provide a security or collateral to avail when applying for the loan. The security can be tangible or intangible such as FDs or fixed assets such as property.

  2. Unsecured education loan for UK or unsecured loan which means you do not have to provide any collateral to apply for a loan.

We have discussed the key differences between the 2 in the table below:

Secured Loan

Unsecured Loan

The bank requires collateral security to provide such a loan.

There is no need for collateral to avail this type of UK education loan for international students.

Helps you get a loan upto 1.5 crores

Helps you get a loan upto 750,000 INR for UK

The rate of interest is usually lower

The rate of interest is usually higher

 

Which Indian Banks provide Student Loans for UK?

You can apply for a UK education loan for international students through public or private banks in India such as Bank of India, State Bank of India, Central Bank of India, Allahabad Bank, Bank of Baroda, ICICI Bank, HDFC Bank, Axis Bank, HSBC Bank among others. Take a look at the table below to learn about some important details regarding loans from India banks:

Bank Name

Maximum Amount of Loan (in INR)

Interest Rate

State Bank of India

1,50,00,000 

10.50%

Bank of India

40,00,000

8.95-9.75%

Bank of Baroda

1,50,00,000 

8.50-9.15%

Central Bank of India

20,00,000 

8.65-10.60%

Allahabad Bank

50,00,000 

7.15-10.05%

Punjab National Bank

Determined on the basis of need

8.90%

HDFC Bank

30,00,000 

14%

ICICI

1,00,00,000 

10.50-13%

Axis Bank

75,00,000 INR

13.70-15.20%

 

What Expenses Are Covered Under Student Loans in UK?

Take a look at the expenses covered under student loan UK:

  • Fees payable to the institution
  • Fees related to examination, library membership, laboratory
  • Expenses on books and supplies necessary for course completion
  • Any refundable deposit for accommodation, caution money, refundable deposit, etc.
  • Travel expenses for studying abroad
  • Two-wheeler cost up to 50,000 INR
  • Expenses on study tour or project work related to the course

 

Repayment of Student Loan for UK

You must learn about the repayment process for UK education loan for international students before applying for one. We have discussed the repayment plan for education loans for UK in India below:

  • Loan from a Public Bank: Repayment will commence after completion of one year of your course. Loan can be repaid within 15 years from commencement of repayment.

  • Loan from a Private Bank: Repayment will commence and continue upto course period +1 year or 6 months after getting a job. Loan can be repaid within 15 years.

Studying in one of the top study abroad destinations like UK is a costly affair. An education loan for UK is a prudent choice to manage your expenses rather than holding back from studying in UK. From the guide above you must have learned about the eligibility, requirements and process to avail student loan UK. There are other ways on how you can finance your education in UK. Just make sure you have all your expenses planned consciously so that you do not have to be burdened by the loan. 

 

Frequently Asked Questions About Student Loan for UK

  1. How much interest will I be charged on student loan UK?

Ans. You can expect to secure an education loan to study in UK from public banks at an interest of 8.85-9.35%. Private banks charge higher rates of interest usually ranging between 10.99-13%.

  1. What factors determine student loan eligibility UK?

Ans. The student loan eligibility UK depends on various factors such as the program, choice of institution, academic profile, job profile of the co-borrower, age, nationality and whether you are applying for a secured or unsecured loan.

  1. Can I reapply if my application for student loan UK is rejected?

Ans. Yes, you can definitely reapply for a study loan for UK if your application has been rejected once.

  1. What is the repayment criteria for an education loan to study in UK?

Ans. The general repayment criteria for an education loan to study in UK from a public bank commences after completion of one year of your course. For private banks, the payment period is course period +1 year or 6 months after getting a job. In both cases, the loan can be repaid within 15 years.

  1. Can I get an education loan without collateral for UK?

Ans. Yes, you can get an education loan without collateral for UK. The amount of education loan for UK without collateral is usually upto 750,000 INR and the rate of interest is also higher.

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