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How Much Salary Do You Need For Education Loans?

How much salary do you need for education loans

While taking an education loan, there are certain things you must take into account, like age, citizenship, university, co-applicant, academic record, etc. Among which, the most important thing that you might probably miss out on is the salary requirement. Based on the salary requirement, your education loan amount might increase or decrease. This is why banks ask for co-applicant’s income proofs to check if they can repay the education loans. You need to understand how much salary you need for education loans and this blog answers precisely that! 

How Much Salary Do You Need For An Education Loan?

The minimum salary required for an education loan depends on the lender’s policy. Most loans require you to make at least Rs. 25,000 per month to qualify, but some lenders may have a higher or lower minimum salary requirement. 

Lenders need to look at salary when approving education loans. Before approving a loan, lenders look at the co-borrower’s income and credit score, the course’s duration and cost, and the borrower’s repayment ability. 

Salary Criteria For Education Loans

Besides good academic scores, admission confirmation from a university, and citizenship, banks have specific salary criteria. If you are an employed student, planning to take a work-study programme, or have a co-applicant for your education loan and are planning to undertake a full-time score, then the bank expects the following: 

  • Each bank or financial institution sets its minimum salary eligibility for co-borrowers or guarantors (typically a parent or guardian). Depending on the lender, this can range from around Rs. 25,000 per month to a higher amount.
  •  More than a fixed salary, lenders assess the overall ability to repay the loan. This includes the co-borrower’s income stability, credit score, existing debt obligations, and the total loan amount.

How To Apply For Education Loans Based On A Bank’s Salary Requirements?

Here are some tips for applying for an education loan, considering your salary requirement:

Before Applying:

  • The minimum salary requirements for co-borrowers/guarantors vary by lender. Make sure you know these requirements. Find out what lenders offer on banks or financial comparison sites like UniCreds.
  • If your salary isn’t enough, having a co-signer with a good credit score and stable income helps. It’s best if it’s a parent, guardian, or close relative.
  • If you’re the main borrower, you need to make timely payments. Your credit score can affect interest rates and loan approval.

Optimising Your Application:

  • If you lower your loan amount, you’re more likely to get approved. To reduce your loan requirement, consider scholarships, grants, or education-focused savings.
  • Some lenders offer better rates for courses with higher employment and earnings potential. Find out what loan options are available in your field of study.
  •  Your application is more vigorous if your co-borrower can demonstrate stable employment and income.
  • Check that all your documents (proof of income, co-borrower details, admission letter, etc.) are accurate.
  • Once you receive offers, compare interest rates and repayment terms. Based on your profile, you can negotiate a more favourable deal with lenders.

Education Loan Repayment Options & Its Impact On Salary

Lenders do consider your future earning potential when assessing your eligibility. Here’s a breakdown of standard repayment options and how they might be affected by your salary:

1) Standard Repayment: This is the most common option, with fixed monthly instalments (EMIs) for a set period (mostly 5-10 years).

Salary Impact: If your salary is lower than expected after graduation, making your EMIs might be challenging. However, some lenders might offer options to:

  • Extend the repayment term: This lowers your monthly payment but increases total interest paid.
  • Defer payments temporarily: This can be helpful if you’re experiencing financial hardship but add accrued interest to your principal.

2) Income-Driven Repayment (if available): This option, offered by some lenders or government programmes, bases your monthly payments on a percentage of your income.

Salary Impact: This option can be beneficial if your initial salary is lower than anticipated. Your payments automatically adjust based on your income, making them more manageable. 

Tips For Meeting Salary Requirements For Education Loans

Since the salary requirement for education loans in India focuses on the co-borrowers income stability, here are some tips to improve your chances of meeting those requirements:

  • Strong Credit Score:  If your chosen co-borrower (parent, guardian, relative) has a healthy credit score (typically above 750), it significantly strengthens your application. A good credit history signifies responsible financial management and makes lenders more comfortable.
  • Stable Employment:  Ensure your co-borrower has a stable job with a consistent income stream. Recent job changes or short-term contracts might raise red flags for lenders.
  • Debt-to-Income Ratio: Encourage your co-borrower to maintain a low debt-to-income ratio (DTI). This means their monthly debt obligations (including existing loans, credit card payments, etc.) should be a small portion of their total income. A lower DTI shows lenders they have the capacity to handle additional debt from your education loan.
  • Multiple Income Sources (if applicable):  If your co-borrower has additional income sources (rentals, investments), it can further strengthen their financial profile. However, ensure proper documentation for these additional sources.


Q1. Can a salaried person apply for an education loan? 

Yes, a salaried person can apply for an education loan. They must submit the proof of ther employment, salary slips, etc.

Q2. Who is eligible for an education loan? 

Indian citizens over 18 years of age with a salaried co-applicant are eligible for an education loan. 

Q3. Which bank is best for an education loan? 

The best bank for an education loan depends on your loan requirement, but to name the best few are- Bank of Baroda, IDFC First Bank, Union Bank of India, ICICI Bank, etc. are the top banks. 

Q4. Is parents’ income required for an education loan? 

Yes, parents’ income is required for an education loan as co-borrowers. 

Q5. What is the minimum salary for parents for an education loan?

Minimum salary of your parents should be Rs. 25,000 and above for an education loan.

Q6. Which bank gives student loans easily?

SBI Bank, ICICI Bank, Axis Bank, etc. give student loans easily if you fit eligibility criteria, salary requirements, and submit proper documentation.

Q7. Is it a good idea to take an education loan?

Yes, it’s a good idea to take an education loan, as these loans have flexible repayment options, lower interest rates, and many government schemes that can reduce the loan rates. 

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How much salary do you need for education loans

How Much Salary Do You Need For Education Loans?

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