Getting accepted into your choice of foreign university is a dream come true. If you harbour this wish then this guide to student loans will help you understand the importance of student loans. Suppose that you’ve just received your acceptance letter! The excitement is real. But then reality hits: how are you going to fund your education? This is where an education loan becomes not just helpful, but essential.
What if we tell you that when applying for a domestic education loan or overseas education loan, understanding the whole process can save you time, money, and plenty of stress.
At Unipay Forex, we guide students every step of the way. From assessing eligibility to choosing the right loan provider, our team simplifies everything and offers customised solutions.
Here is a complete guide for you about student loans and how we come into the picture:
Guide To Student Loans: Understanding Education Loans
What Is an Education Loan?
Education loans, or commonly known as student loans, are financial tools that are used to help students pay for their school fees, living expenses, travel expenses, books, insurances, and others. Education loans are extended by banks and other financial institutions specifically to fund the educational requirements of students. Regardless of whether you’re learning in India or going abroad, the objective is one and the same: to aid your education in a manner that is both accessible and sustainable.
Domestic vs Overseas Education Loans
When it comes to funding higher education, the choice between studying in India and going abroad significantly impacts the type of loan you’ll need:
- Domestic Education Loans are designed for students who are pursuing courses within India. According to Bank of Baroda, these loans typically cover tuition fees, examination and library charges, cost of books and equipment, hostel fees, and sometimes even a computer purchase if required.
- Overseas Education Loans go beyond the basics offered by domestic education loans. These student loans cover not just tuition and living costs but also visa application fees, travel expenses (like airfare), health insurance, and foreign exchange requirements. These loans tend to include higher amounts. For eligibility, they may require stronger financial documentation or collateral.
At Unipay Forex, we evaluate your admission offer, course details, and financial background to match you with the most suitable education loan.
Types of Education Loans
Do you know the types of education loans available? Having the understanding can help you make an informed choice:
Secured Loans
Simply put, the secured education loans require the borrower (or co-applicant) to offer collateral for the loan.
These collaterals can be property, fixed deposits, or even LIC policies. Secured loans are very useful since they typically have lower interest rates, extended payment schedules, and a greater possibility of approval. They suit bigger loan sizes, particularly for studying abroad.
Unsecured Loans
In contrast to secured loans, the unsecured loans do not take any collateral but rely greatly on the credit record of the applicant (or co-applicant).
These loans against students are typically applied for domestic education or for pursuing diploma or certificate courses abroad. The interest rates of unsecured loans may be a little higher because the loan giver is taking more risk. Moreover, the approved amount might be restricted.
Government Loans vs Private Lender Loans
Certain education loans are under government-sponsored programs such as the Vidya Lakshmi Portal, which are aimed at financial inclusion through granting subsidies or interest assistance. Others are offered by private banks and NBFCs with different terms, repayment schedules, and eligibility standards. Unipay works with both types of lenders to ensure you get the right match based on your financial capacity, course type, and long-term goals.
Eligibility Criteria For Education Loan Approval
Before applying, make sure you meet the basic eligibility:
- You must be an Indian citizen
- You should have secured admission in a recognised institution
- Courses should be approved by relevant authorities (AICTE, UGC for India; recognised universities abroad)
- A co-applicant (usually a parent or guardian) is often mandatory
- Good academic history and creditworthiness of the co-applicant can improve approval chances
What Does the Student Loans Cover?
Student loans are more comprehensive than most people think. Here’s what’s typically included:
- Tuition Fees: This is the primary component of any education loan, covering your academic course fees as charged by the institution. Whether it’s an Indian university or an international one, this forms the base of your loan.
- Housing Costs: Student loans can cover dorm charges or rent for off-campus living. This ensures you have a secure comfortable home base during your college years.
- Daily Costs: This covers the stuff you need every day such as food getting around town, and keeping the lights on. It helps you manage life outside the classroom without financial stress.
- Travel: For overseas students, education loans include airfare and visa-related travel costs. Even for domestic travel, loans may cover initial relocation expenses.
- Books and Study Materials: Costs for textbooks, lab equipment, and other academic tools are usually included. Some lenders also cover the cost of purchasing a laptop if essential for your course.
- Insurance: Health and travel insurance are often mandatory for overseas education. Loans cover these so you’re protected while studying abroad.
- Forex Services: Foreign exchange, travel cards, and international remittance services are part of many overseas education loans. These ensure you’re financially equipped to handle daily expenses in another currency.
Unipay goes a step further by integrating forex support, insurance, and even SIM cards into a custom guide to student loans—making the transition smooth and stress-free.
Guide To Student Loans: Step-by-Step Loan Application Process
Step 1: Pre-Application Assessment
At Unipay, we start with a personalised consultation to understand your course, location, financial background, and eligibility.
Step 2: Documentation
Prepare these essentials:
- Admission letter
- Academic transcripts
- KYC documents for student and co-applicant
- Income proof and bank statements
- Collateral documents (if applicable)
Step 3: Loan Application
We help you shortlist lenders, compare offers, and fill out applications—saving you hours of guesswork.
Step 4: Loan Sanction and Disbursement
Once approved, the amount is typically disbursed directly to the educational institution. For overseas loans, a portion may also be credited for living and travel expenses.
Step 5: Moratorium and Repayment
Most lenders offer a moratorium period (course duration plus 6–12 months). Repayments usually begin after this grace period, structured into monthly EMIs.
Key Factors That Impact Student Loan Process
Understanding the loan type, lender, and timeline can shape your experience from start to finish. Here are some important aspects to keep in mind:
Type of Education Loan
Whether you choose a secured or unsecured loan will influence not just your eligibility, but the steps involved. Secured loans involve property evaluation and legal checks, making the process more detailed.
Education Loan Lender
The choice between public and private lenders can change your experience significantly. Secured loans are often smoother through public banks, while private lenders may be more flexible for unsecured options.
Documentation
Each loan type comes with its own document checklist. Secured loans require property papers, legal and valuation reports, while unsecured loans mostly involve financial documents and admission letters.
Processing Time
Secured education loans usually take longer due to the added paperwork and verification. Unsecured loans, being less documentation-heavy, are often processed faster.
At Unipay Forex, we assess all these variables upfront to help you move quickly and confidently through the loan journey.
Repayment Terms You Should Know
Repayment is a critical part of the guide to student loans journey. Here’s what to consider:
- Moratorium Period: You don’t pay during your course and for a few months after
- EMI Options: Monthly payments begin post-moratorium
- Interest Types: Choose between fixed or floating rates
- Prepayment and Refinancing: Many lenders allow early repayment without penalty
Unipay helps you evaluate repayment structures so that you never feel financially overwhelmed.
Common Pitfalls to Avoid
- Skipping Documentation Review: Even one missing paper can delay your loan
- Choosing the Wrong Lender: Don’t just go with the first offer—compare!
- Ignoring Total Loan Cost: Look beyond the EMI—consider processing fees, insurance premiums, and currency fluctuations for overseas loans
- Unrealistic Repayment Plans: Always think long-term.
It is better to watch out for hidden surprises that may come along. Follow the essential guidelines to applying a loan for education and come across with common mistakes to avoid.
Why Choose Unipay Forex for Your Education Loan?
Getting a loan can feel like a huge task. But with Unipay, you’re not doing it alone.
Here’s how we make things simpler for you:
- We help with both Domestic and Overseas Education Loans: Whether you’re studying in India or going abroad, we’ll help you find a loan that fits your needs.
- You get matched with the right lender: Based on your course, university, and finances, we recommend lenders that make sense for you.
- Less stress with documents and forms: We’ll guide you through the paperwork and handle the tricky parts so you don’t have to worry.
- Everything in one place: Need a forex card, travel insurance, or SIM card before you leave? We can arrange that too.
- No surprises: We believe in clear, honest advice. We explain everything up front, so you always know what you’re signing up for.
At Unipay, we’re here to support you—not just get your loan approved, but help you feel confident about your next step.
Final Thoughts on Guide To Student Loans
If you dream of getting accepted into a university of your choice, then you must also prepare for the inevitable education funding needed. Education should be an exciting step forward, not a financial nightmare. While applying for a domestic education loan or an education loan for abroad studies, the key is understanding your options and getting proper guidance. We understand your needs and propose the best suitable route to make your journey from application to approval possible. Need help funding your education? Contact us today and let us help you make your academic journey possible.
