Students who dreamed to study in foreign institutions with unsecured loans should check out this ultimate guide on How to Get Education Loan for Abroad Studies without Collateral. As it provides every single piece of information about the abroad education loan without collateral.
This article starts with an explanation of what is meant by a collateral loan, a brief about education loans without collateral, required documents, eligibility conditions, features & benefits, and the procedure on How to apply for an Education Loan for Abroad Studies without Collateral.
What is Collateral Loan?
A collateral loan is a loan that is sanctioned against specific valuable assets as a security to the lender for the borrowed loan amount. Study loans are of two types such as secured loans and unsecured loans.
A secured loan is a loan with collateral and unsecured means a loan with no collateral. If you want to avail of an education loan without collateral then there are numerous banks and lender options to offer. Simply get into this guide and read the shared data without fail.
Difference Between Secured & Unsecured Education Loans
Knowing the basic difference between the abroad education loan with and without collateral is important for students who are planning to study courses in foreign universities. Check the below table for deep knowledge:
| Basis of difference | Education loan with collateral (Secured) | Education loan without collateral (Unsecured) |
| Eligibility Criteria | Relaxed as the collateral serves as security | The lender must be strict and base their decision on the borrower’s creditworthiness and the co-applicants financial stability. |
| Requirement of Collateral | Property or fixed deposit, as security for the loan | Collateral, is not necessary, but a financial co-applicant may be required |
| Interest Rates | May be low due to the security pledged | Interest rate is higher because of no security |
| Loan Amount | Generally higher depending on the value of the collateral | Lower than the collateral loan amount |
| Loan Processing Time | It takes more time because of lengthy documentation, property valuation, etc. | It takes less time because of relaxed requirements. |
Outstanding Features of Education Loan With Non-Collateral?
The following points are a few salient traits of an abroad education loan with no collateral:
- No holiday period is covered in these loans.
- Offers numerous courses and colleges in various countries
- The range of Interest rates is between 10.50% to 14%.
- Students can get this loan with the signature of a co-applicant.
Lenders That Offer Abroad Education Loan With Non-Collateral & Financial Co-applicant
The following are some of the lenders that help students by offering education loans without collateral for abroad studies.
Private banks: Axis Bank, IDFC first bank, and ICIC Bank
Public banks: UBI and SBI
NBFCs: HDFC Credila, Incred, Auxilo, and Avanse
Above mentioned lenders will provide study loans without collateral so let’s check out the complete details on the same like loan amount and interest rate.
The tabulated data on lenders that provide abroad education loans without collateral and with financial co-applicant helps for better selection further. So, simply refer to the table.
| Lender Name | Loan Amount | Interest Rate |
| SBI | Up to 7.5 Lakhs INR | 10.65% – 11.50% |
| UBI | Up to 40 Lakhs INR | 9.80% – 11.30% |
| Axis Bank | Up to 50 Lakhs INR | 11.00% – 11.50% |
| ICICI Bank | Up to 50 Lakhs INR | 10.85% – 12.50% |
| IDFC FIRST Bank | Up to 50 Lakhs INR | 11.50% – 13.25% |
| HDFC Credila | Up to 65 Lakhs INR | 11.25% – 13.00% |
| Incred | Up to 60 Lakhs INR | 12.00% – 14.00% |
| Auxilo | Up to 65 Lakhs INR | 11.25% – 14.00% |
| Avanse | Up to 75 Lakhs INR | 12.50% – 13.50% |
Note: Above IR and Loan amount numbers can be varied as per their rules and regulations every year or sometimes so refer to their website or discuss with their respective service providers before applying for the loan.
Lenders That Provide Education Loan For Abroad Studies Without Collateral And Co-applicant
Two international lenders help students by providing education loans for abroad studies without collateral and co-applicant. Want to know more about them? Check below:
- Prodigy Finance is the lender’s name they offer the loan amount of Up to 100,000 USD for a 12.00% – 14.00% Interest Rate.
- MPOWER Financing is another lender that sanctions loan amounts of Up to 100,000 USD without collateral and co-applicant for the interest rate like 12.99% – Graduate Programs and 13.99% – Undergraduate Programs.
Benefits of an Abroad Education Loan with No Collateral
There are various advantages of getting an education loan without collateral. Some of them are listed below:
- You can complete the whole process rapidly with less paperwork.
- No need to pay EMIs during the moratorium period
- No pre-payment penalty
- Flexible at repayment
- Benefit with a loan before admission
- Avail top-up loans
- Get Rs.40 lakh to Rs.50 lakh of loan amount under this unsecured type of loan.
Overseas Student Loan Without Collateral – Eligibility Criteria
For availing any public or private or government-provided education loans to study abroad, students should fulfill some required eligibility conditions, which are mentioned below:
- Students should score more than 300 in the GRE exam, to get an admission in USA country universities.
- If you want to study in other countries, then scoring above 6 or 6.5 bands in IELTS exam is must.
- Co-applicant financial income must have above the loan amount.
- After all debts and expenses, annual income must be more than 4 lakhs.
- Applied student parents need to own a resident house.
List of Needed DocumentsTo Apply For Study Loan without Collateral
- University offer letter mentioning tuition fees
- Academic documents
- Employment documents
- KYC documents of both applicant and co-applicant
- Address proof along with the electric bill
- Two Photographs
For salaried co-applicant, any of the income proofs should be provided:
- ITR
- Form 16
- Salary slip
- Salary account detail
For business owners, income proof should be provided and it can be anyone from the below:
- ITR
- Profit & loss account
- Balance sheet
- Business registration certificate
- Business current account
- Applicant’s saving account details
Application Process To Get An Abroad Education Loan Without Collateral
You can apply for an education loan for abroad studies without collateral very easily online or offline. The step-wise process to apply for an abroad study loan with no collateral is as follows:
- Select the best overseas study online with no collateral and read all the loan terms and conditions.
- Study all the loan details like repayment tenure, moratorium period, interest rates, and other facilities of education loans provided by the Indian government.
- If you feel the chosen loan is suitable for your studies in abroad universities then communicate with the lender and proceed to apply for the study loan with no collateral.
- Fill out the application form online or offline by entering all necessary information.
- Scan all the mandatory documents which are mentioned above and upload all of them with the filled application form.
- Finally, submit the form of loan application to the lender and wait for the lender’s response.
FAQs On Study Loan for Abroad with No Collateral
- How much loan amount can I get an education loan without collateral?
The public banks give up to 7.5 lakhs, and private banks & NBFCs lenders provide upto 40 lakhs. Upto 80% of total expenses is offered as an education loan without collateral by foreign lenders.
- Which bank is best for non-collateral loans?
SBI, Bank of Baroda, Axis Bank, ICICI Bank, HDFC, etc. are best for non-collateral loans for abroad studies. Check out our guide called Which Bank Gives Education Loan Without Collateral for Abroad? for getting detailed knowledge on the same.
- Can a student apply for an education loan without collateral?
Yes, a student can easily apply for an education loan without collateral but they should arrange for a co-applicant to co-sign the abroad studies loan.
Key Takeaways
We believe that provided data on How to Get Education Loan for Abroad Studies without Collateral helped you so much while researching unsecured loans for abroad studies.