PAY YOUR WAY THROUGH MED SCHOOL

Five things a med­i­cal stu­dent should keep in mind to avail a trou­ble free loan from fi­nan­cial in­sti­tu­tions

India Today - - COVER STORY - BY NEERAJ SAX­ENA CEO, AVANSE ED­U­CA­TION LOANS, MUM­BAI

Med­i­cal ed­u­ca­tion is a path that ap­peals to those who are ex­tremely pas­sion­ate about the well-be­ing of the so­ci­ety. How­ever, the process of be­com­ing a doc­tor is long drawn and ex­pen­sive. The grow­ing num­ber of pri­vate med­i­cal col­leges has pri­mar­ily con­trib­uted to the ris­ing cost of med­i­cal ed­u­ca­tion thereby, pos­ing a challenge for stu­dents and their fam­i­lies in paying for it, which in­cludes tu­ition fees, liv­ing ex­penses, books, and sup­plies. Banks and other pri­vate ed­u­ca­tion finance com­pa­nies have come for­ward to of­fer ed­u­ca­tion loans, on easier terms. A stu­dent plan­ning to pur­sue med­i­cal ed­u­ca­tion should con­sider th­ese points be­fore avail­ing a loan Ad­mis­sion con­fir­ma­tion Con­firmed ad­mis­sion in a col­lege or univer­sity is a must to se­cure a loan for one’s med­i­cal ed­u­ca­tion. Len­ders maintain a list of recog­nised ed­u­ca­tional in­sti­tutes for pro­vid­ing loans and rank them on the pa­ram­e­ters of ed­u­ca­tion qual­ity, cour­ses of­fered and place­ments. Len­ders also en­ter into a tie-up with such in­sti­tutes to pro­vide ed­u­ca­tion finance to stu­dents. This makes it very crit­i­cal for stu­dents or par­ents to ap­proach a lender that al­ready has a tie-up with the in­sti­tute in or­der to get loans on easier terms.

Cost eval­u­a­tion Stu­dents opt­ing for a med­i­cal ed­u­ca­tion loan should first de­cide on the amount they can pay from their sav­ings and the amount that needs to be bor­rowed from the fi­nan­cial in­sti­tu­tion. Stu­dents plan­ning to pur­sue their med­i­cal ed­u­ca­tion abroad, on the other hand, should also check cur­rency rates as they may end up paying a higher fee.

Fi­nan­cial his­tory Stu­dents should en­sure they have all the rel­e­vant doc­u­men­ta­tion re­quired be­fore they ap­ply for a med­i­cal ed­u­ca­tion loan. The stu­dent should en­sure that the co-signer (which is usu­ally the par­ent or guardian) has all rel­e­vant in­come and fi­nan­cial doc­u­ments in­clud­ing in­come tax as­sess­ment or­der for the pre­vi­ous two years, a brief state­ment of the as­sets and li­a­bil­i­ties of the co-signer and bank state­ments among others. Ad­di­tion­ally, since most med­i­cal loans are higher ticket sizes and usu­ally re­quire a col­lat­eral se­cu­rity such as prop­erty, the stu­dent must en­sure that all rel­e­vant prop­erty doc­u­ments are in or­der.

Bud­get your­self The stu­dent should un­der­stand the re­pay­ment sched­ule of the loan in­clud­ing any mora­to­rium pe­riod of­fered. Bud­get­ing is im­por­tant and one should be pre­pared to cut costs on unim­por­tant things and fo­cus on re­pay­ing the loan as quickly as pos­si­ble. Loans be­come bur­den­some af­ter a while, so it’s bet­ter to clear it be­fore the toll is felt. The stu­dent should be pre­pared to use ex­tra cash or bonuses to make part pre-pay­ments. Re­search in­ter­est rates Stu­dents and par­ents should al­ways look for an ed­u­ca­tion loan that has longer re­pay­ment ten­ure. This will en­sure lower EMIs. Ma­jor­ity of the new loans are sanc­tioned to cus­tomers with a credit score greater than or equal to 700. There­fore, higher the credit score, bet­ter the chances of the ed­u­ca­tion loan get­ting ap­proved with a com­pet­i­tive in­ter­est rate.

BUD­GET­ING IS IM­POR­TANT. ONE SHOULD BE PRE­PARED TO CUT COSTS ON UNIM­POR­TANT THINGS AND FO­CUS ON RE­PAY­ING THE LOAN AS QUICKLY AS POS­SI­BLE.

SHUT­TER­STOCK

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