How to obtain a student loan even in the absence of parental income to study abroad?

The limited repayment capability of your parents won't be an obstacle if you intend to pursue higher education overseas. The variety of funding choices has increased steadily along with the number of students enrolling in higher education abroad.

Grants and scholarships are few and challenging to obtain. At an Ivy League university, studying abroad takes considerable financial resources that can reach millions of dollars. Even with grants, scholarships, and other forms of aid, many deserving Indian students still cannot afford the cost attached.

" Universities abroad only offer grants and scholarships to a relatively modest number of students. Because of the continually growing number of aspirational students, higher education may become prohibitively expensive for a sizeable portion of this population.

Hence applying for an education loan is a smart choice that many students go for.

There are two types of student loans: secured and unsecured. Having good parental income and a strong ability to repay the loan, few students can readily obtain an unsecured school loan. Students with wealthy parents also receive larger loans after pledging their possessions as security. It has been difficult for some students to obtain the appropriate loan amount because their parents do not have a strong financial background.

" In the secured one, the assets of the parents are crucial since they serve as security (collateral) if either the child or the parent is unable to repay the loan. The academic records of the student don't matter much because the financial institution is secure.

Students with less stable financial circumstances frequently had to give up on their goals. Even though some of these students used to receive a modest unsecured loan, lenders normally offer substantially smaller loan amounts as compared to secured loans.

The majority of the expense can now be covered by larger unsecured loans thanks to new choices. Many new funding possibilities have emerged in the field of education finance, particularly for students who lack any assets to use as security. "New-age FinTechs are emerging that give school loans without collateral. As the primary factors for education loan eligibility, these lenders look at the student's prior academic record and potential for future earnings.

Funding may not be a major obstacle if you have the qualifications and have been admitted to some of the most prestigious institutions. Today, merit-based collateral and co-signer-free loans, like those provided by Prodigy Finance, are a popular replacement for or in addition to grants and scholarships. With these loans, students no longer have to rely on conventional options that may put a strain on them and their families, allowing them to focus solely on their studies.

Many of these new lenders are willing to accept greater risks and provide more worthy students with collateral-free loans. There isn't any offered collateral for the unsecured loan. Based on the child's chances and potential for repaying the proposed loan, the bank or financial institution assumes a calculated risk. The bank evaluates a wide range of materials in this case, including the candidate's prior academic performance and the caliber of the student. Candidates may in the case of an unsecured loan.

Some lenders offer even larger sums as collateral-free loans, but again, these are only made available to a small number of students enrolling at the most prestigious colleges. Depending on an application's merits, we can offer unsecured loans up to Rs 75 lakh.

How lenders select borrowers for larger unsecured loans These lenders are taking a significant risk by providing higher education loans, but they do it only after carefully weighing a variety of factors. " In line with this strategy, we carefully evaluate the student's profile. The Employability Potential Score of a student is calculated using 50–60 different factors. These criteria include things like past academic success, educational continuity, entrance test results, the reputation of the university or institution, course selection that takes into account prior knowledge, and more.

Your chance of receiving the required unsecured loan depends heavily on your placement history and the compensation given to prior students who took the same course at the same institution. "No collateral or co-signer is needed from the student to apply. The student's profile and past are taken into consideration when offering collateral- and co-signer-free loans. As the credit risk is determined based on the course and school a student intends to enroll in, as well as the student's anticipated future earnings, we consider these factors. "The occupation of the parents or their ability to pay is not taken into account in assessing the same.

Closing the final mile of a gap

After you begin your studies abroad, you can address the issue if, despite your best efforts, you are still short on funds. There are alternative options, such as financial institutions, that provide loans in foreign currencies without a co-signer or any kind of security. There are no prepayment penalties and the payback can be done in any currency. During the loan, just interest must be paid. After passing the course, the principal sum plus accrued interest can be paid.

ORIGINAL CONTENT:- How to obtain a student loan even in the absence of parental income to study abroad?