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Collateral Free Education Loan to Study in USA in 2024
USA is a highly sought-after study destination by international students due to its distinguished universities that offer a diverse range of experiences and opportunities. However, pursuing higher education in the USA can be costly. In the academic year 2021/2022, more than 199,000 Indian students pursued higher education in the USA, signifying its popularity among Indian students.
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Another reason for its popularity is the ample employment opportunities worldwide after completing a degree. Tuition fees for different programs vary, with the average fee for international graduate students at around USD 39,000. An abroad education loan is an excellent way to finance not only tuition fees but also living and other expenses. Additionally, abroad education loans for US serve as valid proof of funds for US student visas.
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Types of abroad education loans for USA
In general, education loan for US choices for Indian students can be classified into two categories.
Secured education loans for USA
As mentioned earlier, secured loans require you to provide collateral, which can enable you to obtain a higher loan amount compared to unsecured loans. Additionally, you may not require a co-applicant for your loan if you opt for a secured loan. If you are looking for education loan options to study in the USA, two public sector banks that you could consider are the State Bank of India (SBI) and the Union Bank of India (UBI).
Below, we have presented a comparative study of these two banks with regard to education loans for studying in the USA.
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Unsecured education loans for studying in USA
If you don’t have collateral to offer, don’t worry as there are plenty of private banks, NBFCs, and international lenders that can assist you in this situation when applying for an education loan to study in the USA. While private banks and NBFCs may require a co-applicant or co-signer with a minimum financial income and no liabilities, international lenders offer loans without a co-applicant or co-signer. Opting for international lenders may be advantageous as they provide loans to study in the USA in USD, which can help save on foreign exchange charges and other costs, but their interest rates tend to be higher.
Hence, it can be concluded that each lender that offers education loans for USA has its own advantages and disadvantages. To assist you in selecting a suitable lender, we have created a comparative chart for all the possible lenders that offer unsecured education loans. These unsecured loans are available for all Bachelor’s, MBA, and Master’s.
| Lender Name | Maximum Loan Amount | Rate of Interest | Margin Money |
|---|---|---|---|
|
Up to 50 Lakhs INR |
11% – 13.50% |
5% |
|
|
Up to 50 Lakhs INR |
10.85% – 12.50% |
0 – 15% |
|
|
IDFC FIRST Bank |
Up to 35 Lakhs INR |
11.50% – 12.25% |
Nil |
|
Up to 65 Lakhs INR |
11.25% – 13% |
Nil |
|
|
Up to 65 Lakhs INR |
11.25% – 13% |
Nil |
|
|
Up to 60 Lakhs INR |
12.25% – 14% |
Nil |
|
|
Up to 75 Lakhs INR |
12.50% – 13.50% |
Nil |
|
|
Up to 100,000 USD |
12.99% (for graduate programs)
13.99% (for undergraduate programs) |
Nil |
|
|
Up to 100,000 USD |
12% – 14% |
Nil |
Expenses covered by abroad education loan for USA
Once your loan has been approved/sanctioned then it is time to take a disbursement. Now, when it comes to disbursement, it is your choice to take out all the approved money in one go or take it out in parts as per your requirements. Usually, later is much preferred because the interest that is charged will only be on the disbursed amount not the total approved amount. So in case you decide to take disbursement of part amount then the interest that you would be paying will be less as compared to when you would have taken a full amount disbursement.
The expenses which may be covered under loan as per the lender will include –
Eligibility to get abroad education loan for USA
To obtain an abroad education loan for USA as an international student, there are specific conditions/eligibility criteria that need to be fulfilled. These consist of:
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Documents required for an abroad education loan to study in USA
Apart from the eligibility criteria mentioned earlier, it is essential for students to ensure that they have all the required documents before applying for an education loan to study in the USA. The document checklist can be extensive, which is why GyanDhan offers a personalized document checklist to help you expedite the submission process. Some common documents that will be needed to secure a study abroad loan for the USA are:
How to get an abroad education loan to study in USA?
Securing an education loan to study in the USA can be a time-consuming procedure, largely influenced by the lender you select. It is advisable to initiate the loan application process for studying in the USA around 4 to 6 months before your intended enrollment date. Managing the process individually with various lenders can be challenging. However, GyanDhan offers a simplified approach to obtaining an education loan for studying in the USA. The following steps outline how GyanDhan can assist you in acquiring an international education loan for the USA easily.
Step 1 – Begin the loan application process for a US university by assessing your eligibility for an abroad education loan using GyanDhan’s platform.
Step 2 – Once you have completed the eligibility application, a dedicated education loan expert from GyanDhan will get in touch with you to guide you through the loan process. The expert will provide details about the loan application and suggest the two most suitable lenders based on your requirements and application. If you agree, the process will proceed.
Step 3 – Based on the lender’s specific requirements, you will receive a customized document checklist. This checklist will outline all the necessary documents and offer alternative options (if available) to simplify the document arrangement process for you.
Step 4 – Depending on the lender’s instructions, you will be requested to submit the documents either in hard copy (collected by a relationship officer) or soft copy (uploaded on the portal).
Step 5 – Once the documents are submitted, the verification process will commence, which typically takes around 7 to 15 days, varying according to the lender and loan type. Once the loan is approved, you will receive an agreement letter for signing. The GyanDhan user dashboard allows you to monitor the real-time progress of your loan application.
Step 6 – After signing the agreement, you can initiate the disbursement process at your convenience, following the standard procedures of the lender. Some lenders, such as private banks, may deposit the loan amount directly into your account, while international lenders may disburse the funds directly to the university.
Repayment of abroad education loan for USA
When obtaining an abroad education loan for the USA, repayment is an important factor that should be taken into consideration. Two key aspects to consider when choosing a lender are the repayment tenure and the moratorium repayment options. Different types of repayment tenure are available, such as partial simple interest (PSI), simple interest (SI), and EMI. To assist in choosing the best lender for your situation, a comparative guide has been created that places emphasis on repayment as a significant factor for obtaining a loan to study in the USA.
| Lender Name | Repayment Tenure | Repayment Option during moratorium |
|---|---|---|
|
SBI |
Up to 15 years |
No payment or only SI |
|
UBI |
Up to 15 years |
No payment or SI |
|
Axis Bank |
Up to 15 Years |
SI or EMI |
|
ICICI Bank |
Up to 10 Years |
SI or EMI |
|
IDFC FIRST Bank |
Up to 12 years |
PSI or SI or EMI |
|
HDFC Credila |
Up to 15 Years |
PSI |
|
Auxilo |
Up to 15 Years |
SI |
|
Incred |
Up to 15 Years |
PSI or SI |
|
Avanse |
Up to 15 Years |
PSI or SI |
|
MPOWER Finance |
Up to 10 Years |
SI |
|
Prodigy Finance |
Up to 15 Years |
SI |
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Before initiating your education loan application process for the USA, it is crucial to thoroughly explore and compare the options provided by different lenders based on various factors. However, with GyanDhan, you can bypass the challenges by directly contacting us. By leveraging our streamlined education loan process, you can benefit from our free assistance in obtaining education loans for studying in the USA. Our knowledgeable education loan counselor will assess your academic and financial profile and discuss the available loan options suitable for you. We have established partnerships with multiple lenders in the market, including government banks, private banks, and NBFCs. So what are you waiting for, check you loan eligibility now!