Credit Score Vs Credit Remarks

Anyone seeking a loan or other type of credit, whether it’s a home loan, vehicle loan, personal loan, business loan or education loan, must have a credit score of 750 or above. Nonetheless, many lending institutions examine the credit report and credit notes in addition to the credit score. Any unfavourable information on a credit report will have a detrimental impact on the borrower’s ability to obtain a loan. It also lowers the possibilities of obtaining a fast loan. In this blog you will get to know more about credit score vs credit remarks.

What Are Credit Score Vs Credit Remarks?

A credit report is only a statement of a person’s financial actions. It could also be a single word, such as ‘written off.’ It is based on your payback history for loans and credit card payments. Some lending companies are interested in more than just a good credit score as credit remarks are equally important to them. If a negative remark on your credit record is discovered, the lender may reject your loan application. It is necessary to have a strong payback history as well as a decent credit score in order to acquire the finest loan and credit card offers.

The Most Common Form Of Credit Remarks


This credit remark appears on the report in case you have partly paid the dues or settled a loan or any of the credit card dues with the lender. The status after settling appears as ‘settled’ in your credit report. Having this remark in your credit report leaves a negative impact and creates hassles in getting a credit application approved as per your expectations in terms of interest rate.


When you find it difficult to make loan repayments and no payments made from the past 180 days. In that case, the status that appears on your credit report is “written-off. It is known as a detrimental status related to your credit card or loan applications.

“Post-Write Off Settled”

This happens in cases of debt settlement after the written off of outstanding dues. It takes place after 180 days of non-payment. If you are making partial payments of outstanding dues, your credit report will reflect the same status. Having these credit remarks will leave a serious impact on credit score and damage credit status. Avoid having such credit remarks to get a quick and best-in-class loan and credit card offers.

“Willful Default”

Any default mark reflecting in the credit report indicates non-payment of loan EMIs. A willful defaulter is the one who is intentionally making loan defaults despite having sufficient funds to repay the loan amount. This scenario is quite different from the ‘write-off’. If the borrower is not making use of the sanctioned loan amount. They are considered a willful defaulter and use the funds for any illegal activities.


This credit remark on the credit report means you have made the loan payment fully, and the account stands closed. Make sure after closing the account, the lender provides you with the no dues certificate or closure letter stating that the loan stands closed from the end of the financial institution. Within 45 days, the ‘closed’ status will start reflecting on your credit report.

How To Remove Credit Remarks Available On The Credit Report?

Borrowers grow anxious when they see derogatory credit marks on credit reports. But there’s no need to be concerned. Obtaining a credit report from each of the bureaus is the greatest way to work on credit remarks. After that, emphasise the credit report’s good parts. If you discover any errors on your credit report, contact the credit reporting agencies to file a dispute. Never forget to include supporting documentation if the credit report contains incorrect information. If the credit remarks are real, you might write the agency a goodwill letter from a different perspective.

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Common Types Of Errors Available On The Credit Report

1. Identity-Related Errors:

  • Identification of mistakes like phone number, address, PAN number, or incorrect name.
  • Mixing of identity with someone else having the same name.

2. Account Related Errors:

  • When a closed account is reflecting open.
  • Account not showing.
  • The Incorrect account is looking like the default.
  • Incorrect date of EMI payment or incorrectly showing late payment.
  • An account listed more than once with different creditors.
  • Showing old accounts or errors related to balance.

Usually, the negative credit remarks like missed payment, late payment, settled, or post settled written-off remarks are reflected in the credit report for seven years.

How Is The Credit Score Generated?

Here are the main factors that are taken into consideration while computing the credit score:

  • Payment History: 35%
  • Credit Utilisation: 30%
  • Credit History Length: 15%
  • Credit Mix: 10%
  • New Credit: 10%

Credit Score Vs Credit Remarks: What Matters More? 

As previously mentioned, you have read the credit score and credit remarks individually in order for you to grasp the significance of both words in obtaining a loan or credit card approval. Please keep in mind that your credit score is important even if you have no credit history. This score is a numerical representation of a borrower’s financial trustworthiness and repayment capabilities.

The credit score is a straightforward way of understanding creditworthiness in comparison to studying credit remarks mentioned in your credit report. If the lenders want to decide the terms and conditions of loan approval, the lender always checks credit score first.

PS: If there’s anything more you’d like us to know about. Add it to the comments section!

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When Is The FAFSA Due For Fall 2022-23?

When is the FAFSA due for fall? Well, to be eligible for grants, scholarships, federal employment i.e, work-study, and federal student loans, you must complete the Free Application for Federal Student Aid, or FAFSA for international students, for each academic year.

However, federal, state, and institutional aid deadlines differ. The 1st of October and the 30th of June are the two most crucial dates to keep in mind. 

When Is Financial Aid Due?

School YearOpen DateDeadline
2021 – 2022Oct 1, 2020June 30, 2022
2022- 2023Oct 1, 2021June 30, 2023

When Is The FAFSA Due For Fall Next Year & When Should I File It?

The FAFSA application opens every year on October 1st. To increase your chances of receiving the greatest grant, scholarship, and work-study aid, submit your FAFSA as soon as possible after October 1st. On October 1, 2020, applications for the 2021-22 academic year opened. The start date for the 2022-2023 academic year is Oct. 1, 2021.

Certain types of help, such as federal work-study funds and many state and institutional grants and scholarships, are given to students who apply first.

Now’s the right time to secure a safe education loan! Fill out the form in this blog TODAY!

When Is FAFSA Due For Spring?

Students have until June 30 after the school year in which they desire aid to file the FAFSA — for example, June 30, 2022, for the 2021-22 school year or June 30, 2023, for the 2022-23 school year — to do so.

However, you must submit the form much earlier in order to satisfy your state’s and college’s financial aid requirements and get your aid funds in enough time for the start of the school year.

To be qualified for all three types of help, you only need to fill out the FAFSA once. Here’s everything you need to know about each of them.

When Is The FAFSA Due For State & Institutional?

State: Individual states and institutions set their own FAFSA deadlines, which are usually far sooner than the federal deadline. To be considered for state and institutional vocational scholarships and grants, you must submit your request by these deadlines.

You may not qualify for state help if you attend an out-of-state institution; check with the state to see if you do. On the Federal Student Aid site, you may find out when your state’s financial aid deadline is.

Federal: Each year, the federal deadline is the last day to submit the FAFSA. You have until June 30, 2022, to apply for financial aid for the 2021-2022 school year.

Work-study funds and most government and institutional help will be the first to run out, but government funds and student loans will still be available.

You can get these grants and loans retrospectively to reimburse what you’ve already spent for the spring and autumn semesters, even if you wait until June 30. Alternatively, depending on your institution, you might be able to use the cash to pay for summer school in 2022.

Now that you know when is the FAFSA due for fall and other seasons, let us see some following steps ahead:

Following Steps:

Track University’s Funding Deadline: Keep track of financial assistance deadlines at institutions. Individual school priority deadlines are generally the earliest, thus they are the most critical to keep track of. Those dates are also the ideal opportunities to receive the most assistance. Look up the deadlines for all of the colleges you’re considering applying to and write them down in one place – your phone’s calendar, a notebook, or a diary dedicated to your college search are all good options.

Fill out any other financial aid applications you may have: To qualify for state or institutional help, many institutions require supplementary or alternative financial aid submissions, such as the CSS Profile. To be considered for financial assistance, you must submit all needed papers before the deadline.

You can make modifications in your form: After you’ve submitted your FAFSA, you can make modifications. You can edit the FAFSA if you find an error or if you need more aid due to a change in your family’s finances. Sign in to, then click “Make FAFSA Corrections” on the “My FAFSA” tab, input your FSA ID, make changes, and resubmit your application.

Above all, keep October 1 in mind: Although it isn’t a deadline, submitting your FAFSA soon after that day will ensure that you cover all of your bases.

Should you apply for FAFSA before applying to any college?

Yes, you should apply for the FAFSA as soon as it becomes available, even if you haven’t applied or been approved by any universities yet. You only have to name one of the universities you’re contemplating applying to when you first fill out the FAFSA, but it’s ideal to include all of them so you don’t miss out on any financial help. Later on, you will be able to add colleges.

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Things You Need To Know About Insurance In An Education Loan

If you aspire to be an international student you may have considered the various ways of funding your education abroad. This is because most countries that accept students from overseas require financial evidence from the candidate to see if they are able to support themselves financially during their study abroad journey. Most students prefer taking up an education loan for this purpose and rely on secure or unsecure education loans. Before you take up an education loan abroad, there are some things you need to know about insurance in an education loan. 

An insurance against your education loan will help you reduce your burden of repaying the loan if any unforeseen situation takes place. In most cases, the burden of repaying an education loan lies on the co-applicant when the primary borrower is unable to repay the loan amount. But before we dive into the main things you need to know about insurance in an education loan, let us first understand what that means. 

What Is an Education Loan Insurance? 

While school loan or education loan insurance is not required, as it is for house loans, banks are requiring borrowers to choose education loan insurance based on the current job market situation. The slowdown in the local economy, along with the uncertainty of global economic conditions, is having a negative influence on the employment market, with poor campus placements and limited career opportunities. In cases where the primary applicant fails to repay the loan in situations of unemployment or death, education loans insurances come to the rescue. 

Now that you have understood the importance of insurance against education loans, let us understand the main things you must know about insurance in an education loan. 

What Are The Things You Need To Know About Insurance In An Education Loan? 

How Helpful Is Education Loan Insurance? 

Purchasing loan insurance guarantees that, in the event of a misfortune, the co-applicants are not responsible for repaying the whole education loan amount plus interest. Borrowers of government bank education loans, for which even retired parents are identified as co-applicants, may find this to be a tremendous comfort. If the loan applicant has a tragedy during their higher education that would likely result in a fatal disease for the student, the insurance company will pay the whole education loan amount, rather than the co-applicants.

Is It Mandatory To Get Insurance Against Your Education Loan? 

The amount of school loan insurance that is required varies per lender. It is not required to get education loan insurance in conjunction with a study abroad loan when applying for a loan from a government bank. Most government banks allow applicants to choose whether or not to acquire loan insurance as part of any of their education loan programmes. While applying for an education loan without a collateral from a private bank or NBFCs, all students planning to study abroad must get their education loan insured. This is a condition that must be met by every student who applies for an education loan without collateral. The major reason why NBFCs require loan insurance is that they do not require students to put up any collateral in exchange for an overseas study loan. In other words, it is mandatory for students to get insurance on education loans for their study abroad journey, if the education loan is unsecured. 

Unsure of which loans to get? Get a FREE consultation by filling the form in this blog!

What Is The Process Of Paying For The Education Loan Insurance? 

After students have made their decision to purchase education loan insurance, the next question on their minds is whether the lenders would expect payment of the loan insurance costs right away. Now, here comes the exciting part. Education loan insurance costs are not needed to be paid separately by candidates. These costs are calculated based on the total amount of education loans that students have taken out. For example, if you have taken an education loan of ₹ 25 Lakhs, and the insurance amount is calculated as ₹ 50,000, the lenders will calculate a total loan amount of ₹ 30 Lakh and not ₹25 Lakh. Another thing that all students should be aware of before obtaining an overseas study loan insurance policy is that the loan insurance fees are directly proportionate to the length of the education loan term.

The loan insurance fees are cheaper the shorter the loan term.

Is Purchasing Insurance For Education Loan Really Beneficial? 

Borrowing any sort of debt entails taking on a significant financial burden. This is particularly true in the case of an international education loan programme. When students apply for an education loan to pay for their studies abroad, the financial responsibility for repayment rests on their co-applicant/co-borrower until the student achieves financial independence. 

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Which Bank Is The Best For Securing An Education Loan?

The cost of higher education abroad is a key element that dictates the sort of course a student enrols in, as well as the university they choose. The best way to fund your international studies is to take out an education loan. Various financing options are available from Indian banks, depending on the institution and degree of study. 

Most education loan schemes come with flexible repayment options and allow the borrower to plan his/her finances accordingly. Education loans have a moratorium or holiday period, which is highly advantageous since it gives the borrower a time of about six months after the course is completed. Indian banks allow the education loan repayment to be started after this period or as soon as the borrower has found a job. Students can find education loans that cover 100% of their expenses. This includes the cost of boarding, student accommodation, tuition fees, travel and other related costs for the student.

Before we answer the question – Which Bank Is The Best For Securing An Education Loan? Let’s take a look at the salient features of education loans:

  • Anyone between the ages of 18 and 35 can apply for an education loan to study at any authorised university overseas.
  • Management courses, engineering courses, medical, graduate and postgraduate degrees, arts, architecture, pure science, hotel management, and other courses are all eligible for education loans.
  • Tuition, exam costs, lab and library fees, caution deposit, travel, books and equipment, projects, and study tours are all covered by an education loan.
  • For loans obtained for overseas education, borrowers must put in a margin of 5 % – 15%.
  • During the moratorium period, borrowers have to pay the interest, with the principal payment starting when the loan tenure begins.
  • Education loans can be repaid in monthly instalments through ECS or via post-dated cheques to the bank.
  • Generally, banks sanction education loans with tenure of up to seven years, inclusive of the moratorium period.
  • A co-applicant has to be selected for education loans taken for full-time courses. Co-applicants can include siblings, spouse, parents or other family members.
  • Generally, no security has to be submitted for education loans taken up to Rs. 4 lakhs. Third-party guarantee has to be furnished for loans between Rs. 4 lakhs and Rs. 7.5 lakhs and tangible collateral security is required for loans above Rs. 7.5 lakhs.
  • The Central Government has also introduced an interest rate subsidy scheme for repayments done during the moratorium period for the benefit of the weaker section of the society.

Let’s outline your eligibility to secure education loans! Fill the form in this blog!

Top Banks For Securing An Education Loan 

HDFC Credila 

HDFC Credila is the country’s first dedicated education loan provider. HDFC Credila has spent time and money over the years to establish suitable systems, procedures, and know-how in the education business, and it has a number of databases on the subject. HDFC Credila Financial Services provides education loans to study abroad aspirants from more than 1,000 universities across at least 35 countries.

HDFC Credila Education Loan Features – 

Sr No.FeaturesHDFC Credila Education Loan Details
1)Education Loan AmountMinimum Loan Amount – INR 1 LakhMaximum Loan Amount- INR 40 lakhs (without collateral)Exceptional cases – up to 1 Crore
2)Interest Rates 11% to 12.5%
3)Margin MoneyNIL; Finance up to 100% of the expenses
4)Processing Fee1 % to 1.25% of the loan amount
5)Loan TenureUp to 10 years
6)Prepayment ChargesNIL
7)Repayment HolidayInterest to be paid during the moratorium period; EMI starts after the completion of course + 6 months
8)Countries CoveredMore than 35 countries including the US, Canada, France, Ireland, Dubai, Germany, Australia, Singapore
9)Payments During Study PeriodYes, simple interest; For selected good profiles, partial interest repayment is available.
10) Processing Time3-4 working days after documentation

Axis Bank

Axis Bank was founded in 1993 and operates as an Indian private sector bank that offers a wide range of financial services. An Axis Bank Education Loan can help you finance your international studies at extremely low interest rates. Students may now achieve all of their scholastic ambitions with education loans starting at Rs. 50,000 and low-interest rates. Axis Bank Education Loans promise easy documentation, rapid loan disbursement, tax benefits under section 80(E), lengthy payback terms, and more. 

Features Of Axis Bank Education Loan –

Sr No. FeaturesDetails
1)Loan AmountRs 50,000 – Rs.40 lakh (without collateral)
2)Axis Bank Education Loan Interest RateThe exact rate depends on your profile but typically 11% -13% for loans without collateral given to Prime A and B programs. Higher for non-prime programs. Lower with collateral. 
3)Processing FeeFor Loan up to 20 Lakhs, Rs. 15,000 (refundable) + GST.For Loan more than 20 lakhs, 0.75% of (Loan Amount – Rs. 20 lakhs) + GST (Non refundable).For Example, for a Rs. 21 Lakh loan: 0.75% of (Rs. 21 lakh – Rs. 20 lakh) = Rs. 750 +GST.
4)Loan Tenure20 years
5)Margin MoneyNo Margin up to Rs. 4 Lacs, 5% Margin above Rs. 4 Lacs for studies in India and 15% Margin above Rs.4 Lacs for abroad studies.
6)Moratorium PeriodCourse length + 12 Months.
7)Payments during the study periodFull Interest (SI)
8)Processing Time7 days.

Bank of Baroda

The Bank of Baroda was founded in 1908 and is one of India’s oldest banks. BOB provides a variety of local and international services to its retail and business customers. For many years, the Bank of Baroda’s BOB Education Loan has helped thousands of students realise their aspirations of studying overseas. Female students receive a 0.5 percent interest rate reduction through the BOB Education Loan. Also, being a scheduled commercial bank, Bank of Baroda provides various interest subsidy schemes such as Central Scheme of Interest Subsidy (CSIS) for Economically Weaker sections, Dr Ambedkar Central Sector Scheme of Interest Subsidy for abroad studies for Other Backward Classes and Economically Backward classes & Padho Pardesh interest subsidy Scheme for minority communities.

Features Of Bank Of Baroda Education Loan – 

Sr No.FeaturesDetails
1)Maximum Loan AmountListed Universities: Rs.80 lakhUnlisted Universities: Rs.60 lakh
2)BOB Education Loan Rate of InterestListed Universities: 8.1% for boys, 7.6% for girls, Unlisted Universities: 8.85% for boys, 8.35% for girls.
3)Processing FeeRs.10,000 + GST (Rs.10,000 refundable); In case of Real Estate collateral, additional property valuation charge of Rs. 7,500.
4)Collateral/ SecurityLoan amount must be <= 100% of collateral value.
5)Loan TenureUp to Rs.7.5 lakh: Moratorium period + 10 years. Above Rs.7.5 lakh: Moratorium period + 15 years.
6)Margin MoneyListed Universities: 0Unlisted Universities: Up to Rs.4 lakh – 0, Above Rs.4 lakh – 10%
7)Moratorium Period12 months after the completion of the course.
8)Prepayment PenaltyNo
9) Institutions CoveredClick here


ICICI Bank is a major Indian private sector bank that was founded in 1994. ICICI offers a wide range of credit products, as well as banking and financial services, to fulfil the demands of a wide range of customers. The bank is aware of students’ professional aspirations, which is why it has designed its ICICI foreign education loan to ensure that each student succeeds on his or her route to the future. With a collateral-free loan of up to Rs.40 lakh, tax savings on interest paid u/S 80(E), customizable tenure and repayment choices, and competitive ICICI Bank education loan interest rates, students may fulfil their goal of obtaining a world-class education in top universities around the world.

Features Of ICICI Bank Education Loan – 

S.No.CharacteristicsICICI Education Loan Requirements
1)Maximum Loan AmountRs.1 crore (With Collateral)Rs. 40 Lakhs (Without Collateral)
2)ICICI Bank Education Loan Interest RateStarting @ 11.5% p.a. (linked to their benchmark rate)
3)Loan TenureLoan Without Collateral: For UG – Moratorium period + 5 years. For PG – Moratorium period + 8 years. Loan With Collateral: For UG – Moratorium period + 7 years. For PG – Moratorium period + 10 years
4)Repayment HolidayCourse + 6 Months
5)Margin MoneyUp to Rs.20 lakh: NILAbove Rs.20 lakh: 15%
6)Processing Fee1 % of Loan Amount + GST
7)Processing Time7 days
8)Payments during the Study PeriodRepayment during the study period is mandatory, partial repayment options are available depending on the target course and institute.
9)Courses coveredJob oriented degree or postgraduate diploma/professional courses offered by reputed institutes at the Undergraduate and Postgraduate level

How To Apply?

Going to multiple banks to get quotations for your education loans can be a hassle. UniCreds allows you to compare and apply to the best financial institutions that offer the best education loans for your higher education dreams. Here are some benefits of applying for an education loan through UniCreds –

  • Low Time Turnaround

In just a week, UniCreds will get your education loan approved.

  • Doorstep Service

Someone will visit your home to pick up documents for your education loans. To get your loan approved, you need not go to any branch.

  • No Cost to You

Our services are completely free for applicants. We do not charge the applicants any processing fees or commissions at all.

  • Higher Chances of Approval

We approach bank officials immediately to find solutions in the event of any lost records or any roadblocks. This guarantees the quick resolution of problems and dramatically improves your approval chances.

So what are you waiting for? Click here to get one step closer to finding your ideal education loan solution! 

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Everything You Need To Know About EMIs

If you’re a student planning to secure an education loan to study abroad, understanding what an EMI is and how it works would be very helpful for you. An Equated Monthly Installment or an EMI is a very common term associated with loans – whether you’re talking about home loans, personal loans, student loans, or business loans. So what is an EMI and how is it calculated? This article will help you understand everything you need to know about EMIs and how you can plan out your loan repayment process while or upon graduation.

What Are EMIs?

As mentioned earlier, an EMI is an Equated Monthly Installment that is ideally a fixed amount of money that you as a borrower will have to pay your lender to repay your loan easily. Keeping this in mind, there will be a fixed date on which you can pay your fixed amount either via cheques or via online payments on a monthly basis.

EMI Components

EMIs have 2 major components, namely:

  • Principal
  • Interest

The initial stages of your loan tenure are when you pay your interest amount which at that moment would be higher than your principal repayments. However, towards the end of your repayment period, a bulk of your payments will be contributed towards the principal component.

What Are The Factors That Impact Your EMIs

There are 3 major factors to consider when looking at EMIs which happen to impact/affect your payments and they include:

Loan Amount: The primary factor that determines your EMI value would be the amount you’re borrowing. This is directly proportional in the sense that the higher your loan amount is, the higher your EMI will be.

Interest Rate: Another critical factor affecting the EMIs would be the interest rate on the loans. The interest rate for your loans is calculated by the lenders based on several factors such as your income, repayment capacity, credit history, the prevailing market situation, and many more. 

Can Your EMI Change During Your Tenor?

EMIs do not usually change in a regular tenor period unless there are certain situations or circumstances that may prompt your EMI to change. We’ve mentioned a few of them:

Floating Interest Rate:  These types of interest rates influence your EMIs based on the market dynamics. So when the interest rates fall, do your EMI, and vice versa.

Loan Prepayment: If you prepay a certain portion of your loan amount, your EMI changes. When you prepay a certain amount, your principal amount comes down, consequently reducing your EMI.
Progressive EMIs: You have an option of paying progressive EMIs, particularly if you’ve opted for a long-term loan and if your lender agrees to it. This means that you pay a certain EMI amount initially, which can progressively increase as your salary increases. That way, you can pay off your loan faster.

Let’s outline your eligibility to secure education loans! Fill the form in this blog!

What Is A Moratorium Period?

An education loan usually comes with a moratorium period. This period usually denotes the time in which you as a borrower need not make any repayment. It was designed ideally to facilitate students to start paying upon the commencement of their earnings. 

On a general note, your interest rate is calculated on a compound interest basis, but within the moratorium period, it will be calculated on a simple interest basis only.

How Can You Better Your Chances Of Lowering Your Interest Rate?

Your interest and the EMI payments are directly proportional to the interest rate your lender gives you. While your lender may have the upper hand over this variable, you can secure a great interest rate –

  • if you have a guarantor with a handsome credit score
  • If you’ve secured admission to a reputed college with promising job prospects to follow

Towards the end of your moratorium period, you will begin your EMI payments. As stated earlier, your interest rate post this period will be calculated based on the compound interest. To compute your monthly dues in your total outstanding amount, you simply add up the principal amount + your total simple interest. The future interest rate and the EMI amount to be paid next will be calculated using the compound interest formula. 

Since this can be a complicated process to understand, it is easier to use an education loan EMI calculator to determine the monthly cost of your loan and the total interest you incur. On that note, you should know about UniCreds which is an online education loan platform that helps fuel the dreams of students who wish to study abroad by providing funding opportunities by way of education loans. If low-interest rates and collateral-free loans are what you’re looking at, this is the right place for you, and now is the perfect opportunity for you to secure a loan with UniCreds.

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Best Practices To Pay Off Your Education Loan Earlier

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To pay off your education loan earlier, you must follow a certain set of practices that will decrease your loan payment period and help you achieve your financial goals faster. Getting a job after graduation is your first step to start the repayment of the loan in the form of Equated Monthly Installments also called EMIs. An education loan can take more than 10 years to get completed, including the interest liability that comes with it. It may look difficult at first but when you plan your loan repayment, the process can be a lot faster and easier. 

Before understanding how you can pay off your education loan earlier, let us first understand why it is important to pay it earlier and how it must benefit you.

Recommended Read: Student loan grace period extension ways

Why Should You Pay Off Your Education Loan Earlier?

When you start your loan repayment, it takes a significant amount out of your monthly salary. This amount can be exercised and used correctly to attain your other important financial goals. Imagine if you end up changing your job, it will hinder and become very hard for you to manage the entire payment. Delay in payments can be a serious problem that will further burden you and jeopardize your credit history. The fewer years you take to repay a loan, the more deduction you see in the rate of interest. This saves you a significant amount of money. 

How To Pay Off Your Education Loan Earlier

Let’s take a look at various methods and ways in which you can plan and implement to pursue an early repayment.

Begin Early

One of the main reasons why many take added years to repay the loan is that they start late. When you take your education loan make sure you consider repayment calculation correctly. Start repaying in the moratorium period. A moratorium period is a time where you enjoy a holiday from your loan EMI’s before you start paying it. Starting then will save you a concession of 0.50% in ROI. Yes, it’s true depending on your lender the relaxation can be given on the payment of education loan if you start early in the moratorium period. 

Create Different Ways Of Income

Before you start with your actual job that will contribute marginally to paying the loan, you can start earning part-time early and save a lot of money before your repayment period starts. The saved money will help you prepay the borrowed amount. One way to plan your repayment and schedule everything as per your convenience is by using an EMI calculator. When you choose to opt for part prepayment, the lender will offer you paying the same EMI. Should you do so? Well, if you want to decrease the loan tenure and save more on the interest then this option is great for you! By keeping the EMI number intact you can repay the loan by cutting more than 6 months in your payment. 

Choose A Shorter Loan Tenure

An easy and smart way to pay off the loans early is to pay more regularly. You can do so by going for a shorter payment tenure. EMI tends to go higher when the tenure is shortened so don’t go to an extent where you will be unable to make that many monthly payments. Choose a shorter tenure that will support paying early by keeping in check with your interest payments. 

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Save More | Pay Off Your Education Loan Earlier

From the money that you earn before you start the repayment, save as much as you can. You can open a savings account or a fixed deposit to save money from your salary every month. It is strongly recommended that the borrower save as much as possible to limit their expenses for a period up to the beginning of their loan tenure. This will make it easier for you to repay the loan before the anticipated close. 


Choosing the right lender for your education is very important. Try to borrow from loans that have the lowest interest rate because it is the ROI that digs a hole in your pocket compared to the actual loan amount. 

Followed by using the combination of the above-mentioned tips, it will help you get debt-free sooner without going broke at the end of each month. Moreover, having a good repayment history comes with a reward of a boost in your credit score. That will help you a lot in the future. Good luck! 

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Here Are Some Student Loan Relief Options

Most college students leave with a substantial amount of debt. According to the Federal Reserve, adults in 2019 who had college debt owed between $20,000 and $24,999. For those struggling with student debt, student loan relief options can sound like a dream come true. However, these programs are only available for federal student loans, not private ones, and the qualification requirements can be rigorous.

What Is Student Loan Relief?

The U.S. Department of Education offers several forgiveness and discharge programs for federal student loans. You may qualify to have some or all of your loans forgiven or discharged in certain situations. While the terms student loan forgiveness or cancellation and loan discharge are often used interchangeably, they’re very different from one another. You may qualify for student loan relief options, based on your qualifications, such as your career path. You may even be eligible for loan discharge based on circumstances beyond your control, such as becoming totally and permanently disabled.

Student Loan Relief Options

With student loan forgiveness programs, you typically make payments for a set period. After you meet the forgiveness programs’ requirements, the remaining loan balance is cancelled.

1. Income-Driven Repayment Forgiveness

Income-driven repayment (IDR) plan forgiveness is a good option if you cannot afford your payments under a 10-year standard repayment plan. With this approach, you enter into an IDR plan, which bases your monthly payment on your family size and disposable income. Depending on your situation, you could qualify for a much lower monthly payment than you’re making now. Your repayment term may be 20 or 25 years, depending on what plan you choose. If you still have a balance at the end of your repayment period, the remaining amount is forgiven. However, the cancelled loan amount may be taxable as income.

You can apply for an IDR plan online or by contacting your loan servicer. To be eligible for the IDR plan student loan relief options, you must qualify for one of the following IDR plans and have a balance after making payments for the full repayment term:

2. Perkins Loan Cancellation and Discharge

If you have Perkins loans, the last of which were issued in 2018 and work in public service. You may be eligible for partial or full loan student loan relief options. Depending on your position, you could have up to 100% of your loans forgiven within five years. To apply for Perkins loan cancellation, you must contact the school that made the loan.

3. Public Service Loan Forgiveness

Under Public Service Loan Forgiveness (PSLF), some federal loan borrowers can have their loans forgiven after 120 monthly loan payments. To qualify, you must work for an eligible non-profit organization or government agency full-time while making 120 monthly qualifying payments. Payments made under an IDR plan count as qualifying payments for PSLF. The loan balance forgiven through PSLF is not taxable as income. You can use the PSLF Help Tool to find out if your employment and loans qualify for forgiveness.

4. Teacher Loan Forgiveness

With the Teacher Loan Forgiveness Program, you can qualify for up to $17,500 in loan forgiveness if you teach full-time for five full and consecutive academic years in a low-income elementary or secondary school or educational agency.

Eligibility For Borrowers Based On The Type Of Loan:

  • Federal direct unsubsidized (alternatively referred to as unsubsidized Stafford loans)
  • Federal direct subsidized (alternatively referred to as subsidized Stafford loans)

Only teachers of certain subjects, such as mathematics or science, are eligible for the full $17,500 of forgiveness. Teachers of other subjects may qualify for $5,000 of forgiveness instead. To apply, submit the Teacher Loan Forgiveness Application to your loan servicer after completing five years of service.

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Federal Student Loan Forgiveness And Private Student Loan Relief Options

U.S. Department of Education Resources: Student Aid On The Web 

  1. Income-Based Repayment Plan

Information on the IBR Plan for federal student loans, including eligibility requirements and an IBR payment calculator. 

  1. Public Service Loan Forgiveness Program

Details on the Public Service Loan Forgiveness program, which forgives federal loans after ten years of eligible employment and eligible payments.

  1. Pay as You Earn Repayment Plan

If your student loan debt is high relative to your income, you may qualify for the Pay As You Earn Repayment Plan. Most Direct Loans (except for Direct PLUS Loans for parents and Direct Consolidation Loans that repaid PLUS loans for parents) are eligible for Pay As You Earn.

National Consumer Law Center: Loan Repayment Assistance Programs (LRAPs)

  1. Law School-Based

LRAPs are offered to graduates from over 100 law schools. Eligibility for most, but not all, of these programs is based on the level of your income and public interest employment.

  1. Statewide Loan Repayment Assistance Programs (LRAPs)

LRAPs from states that provide repayment assistance to public interest attorneys. Eligibility and assistance levels vary.

  1. Repayment Assistance for Federal Employees

Repayment assistance for federally insured loans to employees of some federal loan services.

  1. Additional Options for Government and Non-Profit Employees

Military service, AmeriCorps service, and other public service programs provide specific assistance with educational debt.

  1. Lowering the Stakes: How Law Schools Can Help Next Gen Lawyers Take Gamble Out of Hefty Tuition

In this audio program, ABA Journal Podcast moderator chats with our guests about tuition, disclosure and what could and should change about legal education to train the next generation of lawyers without saddling them with crushing debt

PS: If there’s anything more you’d like us to know about. Add it to the comments section!

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Tips To Cope With Your Student Loan Stress

If you are just out of college and living on a limited budget, paying off your student loans can be very stressful. Debt related stress can feel very overwhelming at times, but with some planning, you can stay on top of that stress and make progress towards paying down your debt. Before we get into tips to cope with your student loan stress, let’s talk about the causes of student loan stress:

Student Loans and Mental Health

Financial Pressure Creates An Environment For Mental Health Issues

Two factors that create financial and emotional stress on young adults. First, many young people have a poor understanding of the long-term effects of financial decisions like a student loan. Hence, they tend to take greater risks in their finances than any other age group. Second, over a third of college freshmen suffer from at least one mental health problem. Many of those suffering from mental health problems have experienced its effects right from their school days.

In addition to the responsibilities of job and family, college students facing student loan payments, have an emotional and psychological attack. While budgeting can immediately help put a student back in control, cost-saving measures applied to monthly expenses can help relieve financial pressure and stress. Financial satisfaction is an important component of life satisfaction, and it is closely related to one’s overall psychological well-being.


Anxiety is a natural reaction to stressful situations. Our bodies inflame to provide higher levels of focus to meet a challenge, whether it be a college test or job interview. However, an abnormal level of anxiety, or anxiety that persists long after the immediate challenge has passed, is an unhealthy state and constitutes a mental health issue. Sustained anxiety is a major cause of social phobias and panic disorders. For some people, anxiety becomes the norm, in what is known clinically as a Generalized Anxiety Disorder (GAD). 

Nearly one in three U.S. households currently live with student loan debt. Financial stress is often a contributing factor to anxiety. When an individual has recurring anxiety related to finances (often the case with student loans) it can lead to an emotional and mental environment that leads to depression and other health issues.

Anxiety and stress rank highest among mental health complaints of college students. A study by the American College Health Association (ACHA) of college students found that stress and anxiety were the top non-academic factors determining a student’s academic success. Students in the study reported periods of feeling overwhelmed and exhausted, both of which are linked to anxiety. Students described their symptoms as damaged memory and an inability to process one’s thoughts. On the emotional side, students compared the inability to relax and have a good time and a tendency to procrastinate to more serious emotional problems like depression. Physical symptoms associated with anxiety include rapid heartbeat, nausea, and dizziness. This can be curbed with a few tips to cope with your student loan stress.

Although anxiety is generally associated with personal, social or financial triggers, factors in one’s environment can also play a part. Lack of sleep or disturbed sleep patterns, diet, neurochemical imbalances, and chemical pollutants in the atmosphere can also factor as triggers or accelerators of anxiety. Coping with anxiety is not a very easy task, here are some tips to cope with your student loan stress.

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Four Tips to Reduce Student Loan Debt Stress

  1. Settle Your Monthly Payments

 One of the best tips to cope with your student loan stress is deciding on how much you will be able to pay every month. If your budget is being eaten up by your student loans, you may want to renegotiate the amount of money you pay each month. This won’t be an option for every loan, but it’s worth asking your loan provider if you can lower your monthly payment amount slightly. Yes, it will take longer to pay the loan off, but it also means that you’ll be able to manage a more realistic budget each month. If your income increases in the future, you can increase your monthly payment amount to the bank.

  1. Debt Forgiveness

Depending on what type of loans you have and what type of work you do, you may be eligible for some form of student loan forgiveness. If you have federal student loans, you can qualify for student loan forgiveness by going into certain public service professions, such as teaching. It’s worth checking to see if you fit the criteria for student loan forgiveness, as it can significantly lower the amount of money you pay in the long run. 

  1. Don’t Hold Back Too Much

While applying these tips to cope with your student loan stress, don’t cancel out on having fun. When you feel like you’re drowning in debt, it can seem like the only solution is to cut out expenses for ‘fun’ activities. And while it’s important to cut back, you shouldn’t completely cut out the things that make you happy. If you love to go out to eat with friends and you completely stop, you might start feeling more stressed. Instead, look for an affordable substitute to party, like having a dinner party at home or going to an affordable happy hour instead of a trendy new restaurant.

  1. Ways To Unwind If You’re Stressed About Student Loans

There are many other ways on how to reduce student loan stress or stress in general. For example:

  • Try breathing exercises for relaxation.
  • Soak in a warm bath.
  • Listen to soothing music.
  • Practice mindful meditation.
  • Write.
  • Use guided imagery.

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What Are Variable Rate Student Loans?

Often, private money lenders offer a scheme of variable rate student loans to loan borrowers who are taking on a new education loan or refinancing their existing loan. These loans, unlike fixed-rate loans which stay the same till repayment, fluctuate over the course of time. 

Since variable rate loans have a tendency to keep changing or fluctuating, they pose a higher risk than fixed loans. However, they also have the scope of saving you hundreds or thousands of dollars in interest.  Whenever you take out a new student loan or set out to refinance your old one, you will be given the option to choose between variable rate student loans and fixed-rate student loans. 

What Are Variable Rate Student Loans? 

How do variable rate student loans work? A variable rate loan is defined by how its interest rates are determined or set. Only private student loans have variable interest rates as all federal student loans come with a fixed interest rate. 

A variable interest loan implies that the interest rate charged on the loan will change and vary over time. If the interest rate changes, your monthly repayment plan can happen to fluctuate too. 

These changing interest rates are not determined by the will or whims of your lender but instead it is the prevailing market conditions in the finance market that determine the variable interest rate. 

Most often, private loan lenders set and increase or change variable rates in direct proportion with the London Interbank Offered Rate (LIBOR). This rate is the average of the rates prevailing in the loans exchanged between banks or financial institutions themselves.

A variable interest rate loan varies from the fixed-rate loan because it can either increase or decrease during the course of the repayment period. It is made up of 2 parts- a fixed margin and a variable interest rate index.

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Fixed Margin

The fixed margin is the only part of variable rate student loans that do not vary over time. It is based on the lender’s analysis of your capacity to repay the loan. How does this work? When you are applying for a private student loan, the lender will analyze the creditworthiness of you and your co-signer. While a variety of methods are used for this analysis, a general rule usually used is if you have a higher credit score, you may get a lower fixed margin.

Variable Interest Rate Index

The second component of a variable interest rate loan is the interest loan index that makes the loan “variable” in nature.  The variable interest index is based on a predetermined benchmark that decides the question of how do variable rate loans work? The lender can decide which index to use but they cannot control its use. The most commonly used index is the LIBOR index that we mentioned earlier. As this index rate changes, so does the index part of your variable interest rate. The fixed margin plus the variable interest rate index make up the total amount of interest rate that you are charged with. 

Why You Should Opt For Variable Rate Student Loans 

Very often, variable interest loans start with a lower monthly payment and can thus save you a lot of money immediately in the short term. 

If you are seeking a new education loan or refinancing your old student loan, here are some of the reasons to watch out for variable rate student loans-

  • If you anticipate that the interest rate will remain low for a while
  • You are seeking cheap initial repayments- one of the main reasons to watch out for variable rate student loans.
  • You are opting for a short repayment period 
  • You are going back to college and want to refinance your old private student loans. 

We hope you enjoyed this blog on What Are Variable Rate Student Loans? To know more about related fields, do check out our other blogs. 

Ways To Cleverly Finance Your Final Semester In College

It happens a lot of times. The aid that helped you with your finance last year is not available this year or you don’t know how to finance your final semester in college. For many students, when they receive the financial aid for the next semester, there is a difference between the tuition now and the budget you have. Here, you don’t have to set your educational goals and process back by taking off a semester.

Remember that using your money wisely is a responsibility that comes with college. It all changes when you are on your own. Here you have the freedom to decide but at the same time, you need to be compliant towards your actions. And above all, you experience the consequences of your own judgments, whether good or bad.

4 Ways You Can Cleverly Finance Your Final Semester In College 

1. Merit-Based Or Private Scholarships

Even though many scholarships are available only once a year, don’t miss the ones that are available year-round. Many scholarships give out aid several times a year. Some scholarships are entirely merit-based, depending on your academic excellence and other merits like sports and extracurricular activities. 

Then there are also need-based scholarships which aim to help the students who are needful and lack funds to achieve their goals. If you belong to a lower income group and need an endowment to help you with your final semester, then look out for such scholarships. You can also apply for outside scholarships about which your school’s financial aid office will guide you and find a way to finance your last semester in college. 

2. High Paying Part-Time Jobs

Believe it or not but it is possible to find a high-paying part-time job while you are studying. Depending on your curriculum through the two or four years of course time, your extracurricular activities can land you a high-paying part-time job. When you become a part of the college society or lead a sports team, that contributes immensely to amplifying your CV and your interpersonal skills. For example; if you have polished your speaking skills along with good academic performance, becoming an academic tutor for instance can make you $20-$40 an hour. 

The job can upskill your portfolio while making a reasonable amount of money. Once you know how to balance work with your studies, you can make a handsome amount. Additionally, keep a lookout for on-campus jobs, many universities have admin jobs and internships that pay well.

3. Savings And Crowdfundings

Do not overlook personal savings as an option, it can become a great way of funding. This is especially for people who have time in their hands, start saving now as they can be very reliable in later stages. Crowdfunding is also a great option for students who want to cleverly finance their last semester of college. Sites like GoFundMe and Crowdfunder have helped students with tuition fees and added expenses. For two-year programs, fellowships and apprenticeship programs have also helped cover expenses. 

4. Private Loans

If nothing works out in your favour then private loans are still an option to cover your balance. If the loan is in the student’s name and you hold no credit history then your parents might have to co-sign for the loan. Proceed with caution as private loans can come with higher interest rates. These loans also do not allow flexible repayment methods as compared to other federal student loans. Read over the terms and conditions so you understand what you will be getting yourself into. Try to look out for reputable lenders who give loans for the lowest rate of interest.

If you’re an Indian student who requires financial aid and wishes to apply for an education loan, make sure you fill out the form in this blog.

Final Thoughts:

There are scholarships, loan providers, college students aids; all designed to help you cover the cost of your daily living expenses as well as education. But apart from that, the trivial details that a student must pay attention to right from the start are cutting costs, saving on food and books, planning your budget, and tracking your expenses. If you feel you must be running out of money amid a semester then take control of your time and how you spend your money. Protect your budget by identifying where the money is flowing more, how much are you spending on tuition, books, accommodation, food, and other social activities. One way of keeping track is by using apps available online or by maintaining a simple spreadsheet.

Instead of being unaware of your daily expenses, figure out how much you spend daily and hence through each semester. And even if your financial circumstances switch, take the help of the above-given steps to cleverly finance your final semester in college.

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