Education loans have always acted as a catalyst in facilitating opportunities for ambitious students and help them achieve their academic and career goals. Applying for a loan to fund their education is a tough exercise, which students need to attend very carefully. Information of education loan interest rates, application process and documents required for education loan is crucial to gaining the most beneficial service.

To provide education loans, banks set a number of terms and conditions for applicants. Every aspiring education loan applicant needs to follow these terms and conditions to utilize the maximum services provided by the bank. This includes being ready with the complete authentic documentation (like KYC, marksheets etc.) for the official purposes.

Education loan documents can be broadly categorized under following headers. Each of these headers enlist various documents required to satisfy the education loan eligibility criteria. Details of documents required for loan application are mentioned below:-

Documents required for education loan

Documents required for education loan	Particulars
Identity documents	KYC Citizenship Regional domicile Residence proofs
Academic Records	Last qualification marksheets, score card, degree or diploma Latest admission proofs Basic qualification records (HSC/10th/12th passing records)
Financial documents	Bank Statements Income Tax documents
Collateral documents	Documents of ownership of asset
Generic administration documents	Application form Guarantee forms Subsidy application forms

Although the documents mentioned have their own importance for each stage of loan application. But that’s not the necessary order of documents required for education loan. Following is the chronological order of documents required for education loan by the order of their relevance.

Proof of identity documents for education loan

Importance factor: 8/10

Ease of availability: 9/10

What are the proof of identity documents required for education loan?

Word of caution: It is mandatory to submit a proof of identity while applying for an education loan.

Amidst the common discourse in the banking community about the identity proofs, there are certain documents which are considered as valid proofs of identification. Applicants and Co-applicants both need to submit their respective identity proofs. Identity proofs for education loan application do not only account for photo identity but also residence proofs. Following documents can be included as proof of identity along with education loan application.

Details of identity documents required for education loan

KYC Documents

• Aadhaar card
• PAN card
• Driving License

Address Proof:

• Valid electricity/water/LPG bill
• Valid passport issued by GOI (Government of India)
• Aadhaar Card
• Voter’s ID card (not accepted by all banks)
• Current house lease agreement
• Magistrate/Gram Panchayat affidavit (not applicable for all banks)

Regional/Domicile Proofs:

• Certificate of domicile issued by district magistrate office
• Gazzeted affidavit (not applicable for all banks)
• Permanent residence certificate issued by competent State/UT authority

Some banks have a mandatory ruling of requirement for photo identity proof. Old PAN card without photographs or business PAN cards, or any other ID proof without the verifiable hint of photo identification will be rejected.

Academic Records required for education loan application

Importance factor: 8/10

Ease of availability: 10/10

What are the academic documents required for education loan?

Banks require academic records of education loan applicants, to decide the interest rates offered to them. Students need to provide their past academic records to prove academic merit, so that banks can trust their loan repaying capacity. Not only the past academic records but students also need to present relevant documents of admission, including educational institutional profile. Such documents help students to not only apply for a better loan scheme but also avail various education loan tax benefits and interest rate subsidies.

Education Loan Academic documents list:

Past academic records:

• SSC/10^th Class or equivalent mark-sheet/passing certificate
• HSC/12^th Class or equivalent mark-sheet/passing certificate
• Graduation/3 year or 4 year degree marksheet/passing certificate (if applicable)
• Diploma passing certificate/record of marks/diploma certificate
• Records of past scholarships/awards etc.
• Special education/ Professional courses/Certificate courses passing certificate

Current academic documents required for education loan:

• Proof of admission: conditional offer letter/letter of admission/permanent admission letter/counselling seat allocation certificate/bonafide certificate
• Records/documents of academic fees breakup
• College/University/Institution placement records (not mandatory for all banks)

Foreign Education Academic proofs:

• I-20 form for study in USA academic institutions
• CAS Letter for UK education loan applicants
• Entry permit (if applicable for respective country)
• Admission exam qualification proof (GMAT,GRE,IELTS,TOEFEL, etc.)
• Exchange student form or exchange visitor form of the respective country

Financial documents required for education loan

Importance factor: 9/10

Ease of availability: 7/10

What financial documents do I need for education loan application?

Education Loan applicants need to prove their financial viability to repay the loan in time so that banks can trust to provide them with their services. Sometimes banks allow refinancing of education loan to provide addition of loan amount, extended loan tenure or change in EMIs for ease of loan repayment. Appropriate financial proofs provided by applicants help them avail tax and other benefits.

It is not mandatory for a person to be employed in professional service to provide the requisite financial evidences. Applicants from business background and self-employed sectors can also apply for theses education loans.

Financial Documents for education loan

General financial documents required for education loan

• Bank passbook copy/ bank statement (last 6 months or more)
• Academic fees demand letter (issued by academic institution)

Financial documents required for education loan (self-employed/business/pensioners)

• IT (income tax) returns approved and verified by CA (Charted Accountant): at least 24 months
• Proof of turnover (latest Sales tax/Services Tax/GST return statements of business)
• Audited P&L (profit and loss statement) of business for current and previous financial year
• For pensioners: proof of retirement and pension certificate (from requisite authority)
• For self-employed, proof of qualification (not necessary for all banks)

Financial documents required for education loan (employed/govt.-non govt. service/salaried)

• Salary computation statement issued by employer for current and previous year
• Form 16 and ITR returns for at least 2 years
• Salary slips issued by employer (at least recent 2 months)

Collateral documents required for education loan

Importance factor: 7/10

Ease of availability: 7/10

What are the collateral documents required for education loan? Does every loan applicant need them?

Though the central schemes for benefits to economically weaker and minority sections, instruct banks to provide an education loan without collateral, but for other sections of the society with higher demands of loan amount; collateral is required. Collateral does not only acts as physical guarantee for the loan; banks also reduce the education loan interest rate for applicants providing collateral guarantee.

Common collateral documents required for education loans (only applicable for certain loan requests based on loan amount and income proofs of applicant)

• Loan against immovable asset (land/house/property)
  • Property deed/chain of sale deed
  • Allotment letter by Municipal Corporation/Government authority
  • Latest property tax statements, maintenance tax/bill
  • NOC from society/builder
• Loan against deposits
  • Original FD/RD receipts
  • Interest statement of FD/RD
• Loan against securities/shares and debentures
  • De-Mat account statement (last 6 months at least)
  • PAN card copy (mandatory)

Generic Administration documents required for Education Loan

Importance factor: 8/10

Ease of availability: 10/10

What are the other documents required for education loan application?

Education loan application cannot be processed unless the loan application form contains all the relevant details. Apart from a complete application form, students also need to furbish guarantee documents and subsidy application forms for special benefits. Third-part guarantee is required for education loan when the student is applying for education loan without collateral or when the applicant is not a direct customer of the bank from which loan is being taken.

The common additional documents required for education loan application are:-

• Third Party Guarantee application
• Subsidy application forms
• Education loan application form

What is an education loan application form? What details are there in a common education loan application form?

The most obvious document to get an education loan is the application form from the bank. It contains the necessary personal and official details of the loan applicant and co-applicant (required for most in India), required for assessment of the loan application. It contains the following details:

• Name of loan applicant
• Identity verification by passport size photographs
• Personal details like,
  • Date of birth (D.O.B)
  • Permanent and Current address
  • Contact details: phone, email and postal
• Declaration of academic/financial/formal information
• Declaration of beneficiary
• Signature samples of applicant and co-applicant

Government of India and Indian Banking Association (IBA) have stated a few necessary details of education loan application form to organize the loan application process. This helps the students in saving time while filing their loan application. It also helps them to keep check on the least necessary information provided for loan application, maintaining their privacy and financial security. This is the reason why government education loan portal Vidyalakshmi has a ‘Common Education Loan Application Form (CELAF)’.

Education Loan Subsidy Application forms

Education loan tax benefits and subsidy claim forms can usually be found incorporated with the loan application form. However, sometimes banks choose to keep subsidy application and loan application more organized and thus they have separate forms for each of these. There are banks that provide special subsidies to certain applicant categories apart from government education loan subsidies for which they keep separate document and verification forms. A common subsidy application form contains the details of:-

• Applicant’s economic status
• Family Income declaration and breakup
• Age/Gender/Physical health status
• Bank details for subsidy
• PAN card details for tax benefits
• Details of siblings (of applicant) and dependents (of co-applicant)

Post sanction documents required for education loan- Do you even need them?

Out of all the documents that are required for education loan, there are a few requirements of the bank for post-sanction processing of loan. Students need to present these documents in order to get loan disbursements, pre-pay education loan, change loan terms, claim subsidy and transfer education loan (if required). A detailed list of post-sanction documents required are mentioned here:

1. Demand Letter for academic fees (every year/ or every payment cycle as demanded by institution)
2. Copies of receipts for academic fees payments made via education loan
3. Affidavit of extra academic demands (equipment, laptop, two-wheeler, research, academic tour etc.) duly sanctioned/attested by academic authority
4. Transcripts of the applicants’ academic progress
5. Outward remittance request in case of study abroad education loan

Documents that applicants can request from bank

Only banks cannot ask for documents for education loan, even applicants and co-applicants can demand respective documents from the bank for various purposes. Applicants can use these documents for income tax returns and official remittances from their employee benefits. Some of these documents which applicants can avail from the bank are:

• Education loan interest statement
  • For tax deduction/rebate under section 80/E
  • For government interest subsidy claim record
• Education Loan principal statement
  • For tuition fees deduction/rebate from taxable income under Section 80/C
  • For record of due principal amount and number of installments

Education loan documentation might seem very tedious but it is actually very easy based on the kind of loan that you’re applying for. Students only require a handful of the documents mentioned above for their respective loan application. The above stated information is to equip students with most information to have their loan processed very smoothly.

Education Loan and Scholarships

Applicants also have this entitlement of adjusting their education loan margin payment and EMIs with scholarships. They can settle the requirement of margin for every loan disbursement (generally between 5-15% of disbursed amount). No extra documents are required for such transactions.

All this information about the documents required for education loan is more than enough to help you get the best services. For more details on education loan eligibility criteria or interest rates you can search for Buddy4Study Edu-Loans. Happy Learning!