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EDUCATION LOAN RATE OF INTEREST
An education loan is a sum of money borrowed to cover costs associated with higher education or postsecondary education. Education loans are designed to pay for tuition, books, supplies, and living costs while the borrower is pursuing a degree. Education loans are given out in order to pursue an academic degree at a recognised college or university. You can get student loans from the government or from lending institutions in the private sector.
Benefits Of Education Loan
• By choosing an education loan you can prevent exhausting your family's resources and avoiding having to liquidate bonds, mutual funds, or fixed-income investments.
• A Large range of costs are covered.
• It also helps you in liberating your parents from loan burden.
Although there are many different types of education loans, they can be broadly divided into two categories: federal loans supported by the federal government and private loans.
1. Federal loans supported by the federal government- When a borrower needs money for educational expenses, they tend to turn to federal government financing first. Filling out a Free Application for Federal Student Aid is the first step in applying for federal student loans for education (FAFSA).
2. Private loans- These loans are non-federal loans provided by a lender such as a bank, credit union, government agency, or educational institution. In rare instances, the federal student loan package that a student receives may advise the borrower to submit an application for additional funding from private lenders.
Interest Rates On Education Loan
• Loan amounts and interest rates differ between banks
• The basic lending rate is from 9.5% onwards.