UK is a dream destination for international students planning to study abroad. More than 605,130 international students are currently enrolled in UK universities. Remarkably, India is the 2nd top country of origin represented at higher education institutions in the UK. If you, too, are an aspirant seeking admission to the UK but feel overwhelmed by the cost of studying in the UK. Worry not, student loan for UK is here! Among various financial aid available for international students, an education loan for UK study is one of the most popular options.
But how can one avail of a student loan for UK?
These days you can avail study loan for UK at low-interest rates with flexible payment plans, an easy application process, minimal document requirements and timely approval. You just have to get in touch with loan providers to know about interest rates, repayment plans, the amount of the loan, and prepare a budget for the cost of studying in UK.
Let’s explore this guide to check 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.
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. With so many expenses, one may feel financially constrained.
Below mentioned are some of the top reasons to opt for student loans for international students 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. However, 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, a student loan for UK is the best alternative to help you cover all your expenses in a safe and timely manner while fulfilling the admission and visa requirements.
Breakdown of Cost of Living in UK for Indian Students
But how to get international student loan in UK? Let’s check the eligibility and requirements to apply for a student loan for UK.
Eligibility Criteria and Requirements to Secure a Student Loan for UK
Before understanding the process of securing an education loan for UK study, let us take a look at the eligibility criteria to get loans for Indian students in UK:
- The applicant must be a resident of India.
- The age should be between 18 to 35 years at the time of loan application.
- They must 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.
Next, let’s check the document requirements for international education loans.
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 from the bank.
- Proof of admission.
- Identity proof such as Aadhar Card/ Voter ID/ Passport/ Driving Licence.
- 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 must be provided at the time of applying for a 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.
HDFC Credila Education Loan to Study Abroad!
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 steps to follow while applying for a student loan UK:
- You can apply online for a student loan UK.
- You can avail of funding through an education loan to study in the UK up to 9 months after the start of your academic course.
- The processing time for your application will be up to 6 weeks.
- You will have to submit your proof of identity.
- These loans can be repaid once you start earning a stable income.
- The number and amount of monthly instalments will also depend on your monthly earnings.
Guide to getting Prodigy Finance Loan
Next, let’s check the…
Types of Education Loan to Study in UK
There are mainly 2 types of loans for Indian students in UK, let’s check them:
- Collateral Education Loan: 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.
- Non-Collateral Education Loan: Unsecured education loan for UK or unsecured loan which means you do not have to provide any collateral to apply for a loan.
Further, we have discussed the key differences between these two loans 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 up to 1.5 crores |
Helps you get a loan up to 750,000 INR for UK |
|
The rate of interest is usually lower |
The rate of interest is usually higher |
Next, let’s check the banks available for applying for a student loan in UK.
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, and HSBC Bank among others. Take a look at the table below to learn about some important details regarding loans from Indian banks:
|
Bank Name |
Maximum Amount of Loan (in INR) |
Interest Rate |
|
1,50,00,000 |
10.50% |
|
|
40,00,000 |
8.95-9.75% |
|
|
1,50,00,000 |
8.50-9.15% |
|
|
20,00,000 |
8.65-10.60% |
|
|
Allahabad Bank |
50,00,000 |
7.15-10.05% |
|
Determined on the basis of need |
8.90% |
|
|
30,00,000 |
14% |
|
|
1,00,00,000 |
10.50-13% |
|
|
75,00,000 INR |
13.70-15.20% |
11 Important Education Loan Terms to Know!
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, and 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 a study tour or project work related to the course
With this information, next, let’s get to know the repayment method of education loan for UK study.
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 the UK in Indian banks below:
- Loan from a Public Bank: Repayment will commence after completion of one year of your course. The loan can be repaid within 15 years from the commencement of repayment.
- Loan from a Private Bank: Repayment will commence and continue up to the course period of +1 year or 6 months after getting a job. The loan can be repaid within 15 years.
Education Loans for Abroad Study by the Indian Government
Studying in one of the top study abroad destinations like the UK is costly. An education loan for UK is a prudent choice to manage your expenses rather than holding back from studying in the UK. From the guide above, you must have learned about the eligibility, requirements and process to avail of student loan UK.
There are other ways 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. If you need end-to-end guidance in the process, choose Yocket premium.
Frequently Asked Questions bout Student Loan for UK
Ques. How much interest will I be charged on a student loan UK?
Ans. You can expect to secure an education loan for UK study from public banks at an interest of 8.85-9.35%. As private banks charge higher interest rates, usually 10.99-13%.
Ques. What factors determine student loan eligibility UK?
Ans. 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.
Ques. Can I reapply if my application for a student loan UK is rejected?
Ans. Yes, you can definitely reapply for a study loan for UK even if your application has been rejected once.
Ques. What are the repayment criteria for education loans 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 repayment period begins +1 year or 6 months after getting a job. In both cases, the loan can be repaid within 15 years.
Ques. Can I get an education loan without collateral for UK?
Ans. Yes, you can get an education loan without collateral in UK. The amount of education loan for UK without collateral is usually up to 750,000 INR, and the rate of interest is also higher.