The United Kingdom is a veritable cornucopia of world-class educational facilities and job prospects – but as we know such world-class schooling comes at a price. With undergraduate courses comfortably hitting £20,000, studying in the UK is considered to be expensive (and that doesn’t even take into account rent and other living expenses!). Owing to the exorbitant tuition of overseas universities, students find it impossible and unaffordable to pursue their higher education in those colleges. In certain cases, students seek education loan to the UK. Many banks and non-bank financial companies have different education loan schemes for students studying abroad. Here are three simple steps to help you get through the process of how to get an international student loan in the UK.
Application for an Education Loan to the UK
You can apply to either of the banks and NBFCs based on your needs (loan amount, secured or unsecured loan, etc.) by filling out a comprehensive application form and supporting it with the verified KYC papers, admission letter, and collateral needed for student loans for international students the UK.
The Submission is Reviewed by a Bank or an NBFC
The bank checks the borrower’s application, his/her co-credit applicant’s history, the worth and verification of collateral, and his/her background after all records have been submitted (academic and financial). The bank then determines whether to accept or deny their case based on this information. Banks need joint borrowers (co-applicants) with a clean credit background if parents have a poor credit score. If the student loan UK is issued, the bank may determine the interest rate, which is negotiable based on the college and course chosen.
The loan interest rate issued by banks to tier 1 and tier 2 colleges is lower than the interest rate offered to the rest of the colleges. Banks and NBFCs provide a wide range of interest rates. Private banks and NBFCs always have marginally higher interest rates (11-14 per cent) than public banks (9.2-11.75 per cent).
Education Loan to the UK Disbursement
The following measures are taken to disburse the education loan to the UK:
- The applicant provides the bank with the acceptance letter and fee information issued by the college.
- The bank verifies the details and estimates the amount needed at the start of the course and during it.
- the creditor must disclose the precise money requirement with the bank, and the bank may disburse the balance to the account or directly to the connected college/institute after all the terms and conditions are fulfilled.
- Few banks and NBFCs can however levy remittance charges (currency conversion charges). As a result, it is preferable to consult with the bank beforehand.
- Some NBFCs pay the entire tuition fee, leaving no margin revenue. Public and private institutions, on the other hand, leave a margin of 15-20% that must be financed by the applicant.
- While a loan approval letter from a nationalised or private bank may be presented to the Embassy or High Commission as proof/source of financing for visa purposes, loan approval letters from NBFCs may not be accepted. Under any scenario, it is preferable to cash out the whole loan amount at once and hold the funds in your bank account. It is essential to apply for a visa if the student will be studying for more than 6 months under tier 4 of the point-based scheme.
Here is a list of the documents required at the time of application in order to speed up the process.
- Completed application form for education loan
- Mark sheets certifying the last qualifying examination
- Proof of enrollment in the course, an acceptance letter.
- Copies of scholarship confirmation letters, if any
- Expense layout for the applied course
- 2 passport-sized photographs of the applicant
- Copies of all applicable foreign exchange permits
- Statement of the borrower’s bank account over the previous six months.
- A brief summary of the co-applicant’s assets and liabilities.
- Proof of Income (e.g., salary slips, Form 16s, etc.)
- Documents confirming the applicant’s nationality and place of residence
- Proof of age.
- Financial documents (all of the following)
- Salaried individuals: most recent salary slip and income tax assessment orders over the previous two years.
Pre-Conditions to be Fulfilled in Order to Opt for an Education Loan to the UK
How to get a student loan UK? As mentioned at the outset of this post, many students who wish to study in the United Kingdom use education loans to finance their higher education. Although the UK government does not need applicants for higher education to present proof of funding, a CAS/ATAS certificate is needed for a UK student visa.
As soon as students get their university admissions, one of the first things they should do is request a CAS certificate from their respective institution. Students must pay a certain sum as token money in order to receive this certificate.
The value of the token money ranges from university to university. If you believe that the token money cited by your university is excessive and that you will need to add this as a cost in your education loan application, you must account for this in time (1 month prior to your visa process) taken to receive the CAS certificate from your respective university before applying for an education loan to the UK.
Here’s some extra chunk of information for you. The UK government has compiled a list of 23 colleges that do not need students to provide evidence of financial support. It is advised that you review them before applying for an education loan to the UK.
Don’t forget to read: Things To Know About The Student Loan Repayment For The UK
Considering many of the various processes involved with the UK admission process as well as the UK education loan process, it is advisable that you apply for a UK education loan at least 1.5 months before you need the funds. If you have set your heart to study in the UK, you can look for all the options to ensure that you end up at the country and university of your choice.