Benefits of an education loan you should exploit.

An education loan can help you come up trumps, especially when you’re down on money and finding it hard to take your aspirations to the next level. Just approach a lender, fill in the application and get the funds you need to get moving towards your goals. However, most students only exploit one feature of a student loan – the financing. They forget that there are numerous other benefits you can use to your advantage. This article will highlight some of these benefits and ensure you make full use of your loan.

1. Tax benefits.

Many aren’t aware that an education loan can provide you handsome & extremely helpful tax benefits. How? Well, the interest you pay towards a student loan gives you an easy way to avail equal deductions on your annual taxable income.  This is made possible by sections 24 the Indian Income Tax Act respectively. Unlike similar providing made for home loans that caps the amount that can be claimed at Rs. 2 lakh, there is no limit on amount you can claim for deductions with an education loan. You can claim the entire interest amount paid in a year without any limit.

2. Moratorium period.

Some students start repaying their student loans right from the get-go. They find part-time jobs and juggle work with studies to cover their EMIs. This is great as long as it doesn’t obstruct your academics. However, if it is affecting your ability to study, it makes sense to drop the job and concentrate on building your future. This is very much possible as every education loan in India comes with a feature known as the moratorium period. During this period, you get complete freedom from EMI payments. You can extend this period from the day you borrow until 6 months after you’ve found a job or finished your course, whichever event comes first. 

3. Score based benefits.

Most lenders will offer higher loan amounts or reduced interest rate or even waive off processing fees if the applicant has a really good academic history. However, most students who have always done well in school & college aren’t aware of this fact and fail to make use of these benefits. However, one must keep in mind that, even if you’ve excelled in your entrance exams, it makes sense to ask for a reward; most lenders will oblige and if yours doesn’t, it’s best you look for a lender that does!

Using these features can help you maximize the support of an education loan. It will ensure that your loan does more than just finance your education and also help ease your journey to a higher education. If you have any doubts regarding any of these pointers or feel like they will be helpful for you, it makes sense to speak to your lender before signing your name on the application form.

Hope this has been helpful for you, good luck and all the best and remember to study hard!