A loan is money lent to you, that requires you to repay with a percentage of interest on the time of taking the loan. Did you know that there are benefits of taking a loan too? Yes! There are numerous benefits of taking a loan to study abroad.

In this article, we will be looking at some notable advantages of taking a loan for higher education. This article will give you an idea about the benefits of taking a loan and we will also talk about how you can find out information like education loan interest rates for abroad study and more.

7 Benefits of Taking an Education Loan to Study in a Foreign Country

1. Covers almost all of your Study Expenses

Study abroad loans provide comprehensive coverage for various expenses of your journey as a student. They include expenses like tuition fees, travel, accommodation, purchase of learning devices, living expenses and other related needs. A holistic approach like this helps you to focus on your studies and career development.

1. Loans are Offered for Various Courses and Degrees

Banks and financial institutions offer loans for a wide range of course options. These courses include popular STEM courses like Mathematics, Science, Technology and Engineering and even unconventional choices for study programs like certification courses for upskilling and reskilling.

1. Repayment Begins After your Studies

As a student taking a loan to study, you might be worried about repayment. But there is nothing to worry about as the loan repayment does not start till after you complete your education. However, you can choose to make small contributions in the form of simple interest during your moratorium period and choose a repayment option based on your financial requirements.

1. Tax Benefits on the Loan Interest Paid

Taking an education loan in India for study abroad has tax benefits for you and your  co-applicant under Section 80E. It states that any individual applying for a loan to study abroad or higher education for themselves, their spouse or children is eligible for a tax deduction based on the interest paid from the taxable income paid in the fiscal year.

1. Builds your Credit Score

Having a good credit history and credit score is important for students for their plans in the future. The study abroad loan will help you to build a healthy credit score early on which will help you to get lower interest rates, higher credit limits, easier loan approvals, lower insurance premiums and many other benefits ahead.

1. There is No Loan Prepay Penalty

Unlike some other types of loans, education loans do not have any prepayment penalties. A prepayment penalty is levied when the loan repayment is done prior to the scheduled tenure.

1. Makes you Financially Responsible

Taking a loan to study abroad is a big responsibility. With repayments and other financial processes, it will help you to become more financially responsible to make payments on time, be mindful of the opportunities that come with studying abroad and make the right decisions for your academic and career development.

In this article, we have seen how taking a loan as a student can benefit you in various ways. As a student, it will help you to learn more about the financial world and make you more responsible financially so that you can reap the benefits of healthy credit and financial discipline from an early age.

If you are planning to study abroad and want to know more about loans and related services like secured and unsecured education loan for abroad then you can survey banks to find information like rate of interest, repayment tenure, moratorium period and so on. Or you can get the help of an overseas education loan advisor. They can help you compare and choose the best loan option.