A significant financial investment is required to pursue higher education in India or abroad. The financial constraints of the majority of students force them to abandon their goals. Despite the fact that education loans were intended to fill this gap and allow students to complete their education, most do not take advantage of this option due to widespread misconceptions and misinformation. These misperceptions typically prevent deserving students from taking that first step toward a brighter future. These misperceptions can range from concerns regarding high interest rates to difficulties with repayment and eligibility. A significant financial investment is required to pursue higher education in India or abroad. The financial constraints of the majority of students force them to abandon their goals. Although education loans were intended to fill this gap and enable students to pursue their studies to fulfillment, most refrain from pursuing this alternative due to prevalent myths and misinformation. These misperceptions typically prevent deserving students from taking that first step toward a brighter future. These misperceptions can range from concerns regarding high interest rates to difficulties with repayment and eligibility. Immediately assess your loan eligibility!
Here are the 10 Education loan Myths busted with facts for each point-
Myth: It’s hard to pay back an education loan
False: You can easily pay back your education loan on time because not all loans require repayment immediately following course completion; a small amount is paid as an EMI, avoiding financial burden and debt.
Myth: An education loan requires an asset or collateral
Fact: No, many banks and NBFCs offer both collateral and non-collateral loans. The only difference between an education loan with collateral and one without is how much it covers.
Myth: Taking out loans for college hurts your credit.
Fact: Although taking out a loan early in life can hurt a person’s CIBIL score, paying it back on time builds credit history. This makes it easier to get loans in the future, such as for a car, house, or business. Describe how credit bureaus view student loans as low-risk, and how paying back even a small amount of interest each month can improve your score. Include the fundamentals of the CIBIL score and how to monitor credit after a loan.
Myth: Loan Disbursement takes too much time
Fact: The long and slow process of the education loan. Yes, this does occur from time to time, particularly when students lack guidance or a clear understanding of the loan procedure. Now, a lot of things have changed. Applicants can easily connect with lenders through digital platforms. Students can simplify the entire procedure with the assistance of companies like EpiCred, which partners with leading financial institutions. Depending on the documents and the type of loan, education loans can typically be approved within two to seven business days. In addition, these websites walk applicants through the application process step by step, from uploading their documents to learning about interest rates, repayment schedules, and moratorium durations. Pursuing higher education in India or abroad requires a good a significant financial investment. Most students are compelled to abandon their aspirations purely on account of financial limitations. Despite the fact that education loans were intended to fill this gap and allow students to complete their education, most do not take advantage of this option due to widespread misconceptions and misinformation. Ranging from anxieties over high rates of interest to difficulties in repayment and eligibility, these misapprehensions usually discourage deserving students from taking that initial step towards a brighter future.
Check your Loan Eligibility Now!
Here are the 10 Education loan Myths busted with facts for each point-
Myth: An education loan is hard to pay
Fact: False, you can easily pay the education loan timely because not all loans are required to pay just after the completion of the course; a small amount of money goes as an EMI, which avoids the financial burden and the occurrence of debt.
Myth: An education loan requires an asset or collateral
Fact: No, many banks and NBFCs offer both collateral and non-collateral loans. The only thing is that an education loan with collateral covers a bigger amount than without collateral.
Myth: Taking out loans for college hurts your credit.
Fact: Many people believe that taking a loan early in life ruins their CIBIL score, but when repaid on time, it helps build their credit history. This makes it easier to get future loans (like car, home, or business loans). Explain how student loans are considered low risk by credit bureaus, and responsible repayment of even small monthly interest can boost your score. Include the fundamentals of the CIBIL score and how to monitor credit after a loan.
Myth: Loan Disbursement takes too much time
Fact: The long and slow process of the education loan. Yes, sometimes this is true, especially when students have no guidance or clear understanding of the loan process.
Now things have changed significantly. Applicants can easily connect with lenders through digital platforms. Students can simplify the entire procedure with the assistance of companies like EpiCred, which partners with leading financial institutions. Usually, education loans can be approved within 2 to 7 working days based on the documents and type of loan.
These websites also walk applicants through step by step from document upload to learning about interest rates, repayment schedule, and moratorium duration, so that it is a hassle-free experience.
Connect with your counselor for education loans!
Myth: Private lenders and NBFCs are unsafe and unreliable for a study loan
Fact: Many people lend only to public sector banks like SBI, because of the prejudiced thought that private and NBFCs are not safe. Here are the facts that private banks and NBFCs are regulated under the RBI norms to make the process safe and convenient.
Myth: Female students don’t get any extra help with their student loans.
Fact: Many banks provide lower interest rates, processing fee waivers, and extra subsidies for girl students. E.g., SBI offers 0.5% lower interest for female applicants. Also, government programs like Padho Pardesh and Vidya Lakshmi help girls get into college. Emphasize the gender-inclusive policy shifts in India’s education financing landscape and how families can take advantage of them.
Myth: Repayment starts just after starting the course or after completing the course
Fact: Most loans offer a moratorium period, which includes your course duration plus an additional 6–12 months post-study. You don’t have to make full EMI payments during this period. Explain how the repayment start date is calculated by various banks. Make terms like “interest subsidy,” “simple interest during the study period,” and “EMI holiday options” more understandable. Add tips on how to plan finances during the grace period.
Myth: Education loans only cover tuition fees
The fact is that tuition and living costs are covered by an education loan as well. The cost of living includes accommodation, living expenses, books, and travel. Insurance for health care, transportation, etc.
Myth: Getting an education loan requires good grades.
Fact: No, but having a strong academic record and a background in academia is advantageous for scholarship applications. Education loans are granted based on multiple factors, including the course, university, future earning potential, and the financial background of the co-applicant.
Myth: Education loan terms are fixed and rigid
Fact: The terms and conditions of an education loan aren’t always fixed and rigid. In terms of interest rates, repayment terms, and how interest is handled during the moratorium, many lenders offer negotiation and flexibility. When it comes to international and non-cosigner loans, lenders are well aware that no one size fits all. That’s why most of them are willing to tailor terms according to the student’s profile, course, and prospects. Most of the time, students can choose between fixed and variable interest rates, giving them more control over how they want to set up their loans.
Myth: Education loan process is too lengthy and hectic
Fact: Getting an education loan for higher studies or loan for abroad studies is not lengthy once you know the process and the right guidance. It generally takes a maximum of 30 days for the loan disbursement. Make your all the documents are ready and updated.
Financial Assistance by Education Consultants
From choosing the right lender for the education loan to the disbursement process, EpiCred supports you at every stage. We help you compare loan offers, understand terms clearly, prepare the right documents, and make sure the funds reach your university on time, without stress or confusion.
