What is the value of collateral for education loan?

Collateral of suitable value is required for all education loans exceeding Rs. 7.5 Lakh. Tangible Assets – House, Apartment, Bungalow, Shop, Non-agricultural Land, Vehicle etc. Intangible Assets – Fixed Deposit, Life Insurance, Stocks etc.

Why agricultural land is not accepted as collateral for education loan?

NO Banks/NBFCs accept agricultural land as collateral for an educational loan because of SARFAESI ACT, 2002. Commercial properties are not preferable, These properties mostly get rejected by banks as collateral for an education loan.

What securities can be offered for education loan?

They are as follows:

• Immovable assets – These can be real estate assets such as land, house, flat, etc.
• Intangible assets – These are liquid securities such as fixed deposits, mutual funds, ULIPs, Life Insurance policies, Government Bonds, etc.

Can education loan apply without collateral?

Lenders you can approach for an education loan without collateral. Public banks – Public banks like SBI, BOB, etc according to their policies can only provide up to 7.5 lakhs student loan without collateral irrespective of the course and country.

Can agricultural land be mortgaged for education loan?

Agricultural properties will be accepted as Collateral Security for Education loans, only in States where it is permitted to mortgage Agricultural Land for purpose other than Agricultural Activities.

Can I mortgage my agricultural land?

Normally, no agricultural land can be mortgaged for raising loan for other than agricultural activities. Approval of loan depends on the terms of banks, Most banks refuse to grant loan on agriculture land, as the recovery proceeding against the agriculture land cannot be proceeded in case of default.

What is the interest rate on collateral education loan?

The interest rate on Collateral Education loan is usually between 9.4\% to 10.3\%. There are three types of collateral that the bank accepts for the abroad education loan. Immovable Property: The independent house, flat, or land is accepted as security by the Bank.

Can I get an education loan using agricultural land as collateral?

Yes, you can get an education loan using agricultural land as collateral. It is the value of the land that is more important. You can only get a loan amount which is less than the value of the land.

Can I get an education loan with an LIC policy as collateral?

You can get an education loan with an LIC policy as collateral with the condition that only the surrender value or a matured policy can be used as valid collateral for an education loan. If these collateral assets are not available then you could also try for non-collateral loans from many private banks or NBFCs.

What kind of collateral is required for an abroad education loan?

There are three types of collateral that the bank accepts for the abroad education loan. Immovable Property: The independent house, flat, or land is accepted as security by the Bank. Non-agricultural open land with clear defined boundary lines is also accepted as collateral. Agricultural Lands are not accepted as Collateral.