| What is the maximum loan amount? |
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| The maximum amount of loan sanctioned would be Rs. 10 Lakhs for studies in India and Rs. 20 Lakhs for studies outside India. Under our special education schemes, maximum of Rs. 20 Lakhs can be sanctioned for studies in India. |
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| Who can be the co-applicants for the education loan? |
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| Parents (either father or mother) can be the co-applicant. In case both parents are not there, the guardian can become the co-applicant. In case of married applicants, the spouse can become the co-applicant. |
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| What are the loan tenure options? |
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| The repayment period is maximum of 7 years, after the moratorium period. |
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| What are the applicable rates of interest? |
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| Please click here for information on rate of interest. |
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| What are the processing charges? |
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| Please click here for information on processing charges. |
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| How is the interest charged/calculated? |
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| Interest will be applied in the account on the basis of reducing balance method at monthly rests. During moratorium period compounding interest would be charged. |
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| What is a Monthly Reducing balance? |
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| An Equated Monthly Installment (EMI) has 2 components, interest and principal. When the interest is calculated on monthly rests, the principal on which the interest is charged goes down every month. This results in a significant saving for the customer over the tenure of the loan. |
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| How do I repay the home loan? |
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The loan shall be repaid in equated monthly installments (EMIs).
You can pay the EMI in any of the following ways
- Through standing instruction to your Union Bank of India savings account to directly remit the EMI amount to your loan account
- Through internet banking facility available on your Union Bank of India savings account
- ECS (Debit) facility
- Post Dated Cheques (PDCs)
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| Can I prepay my education loan? |
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| Yes, you can make your prepayment. There is no charge on pre payment if the loan is adjusted by the borrower from his own verifiable legitimate sources. However, a charge of 2% on the average balance of the preceding 12 months if the loan is taken over by any other Bank/ FI or adjusted by the borrower in lumpsum from any third source/party (except genuine sale). |
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| What security/ collateral do I have to provide? |
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The security required is as mentioned below.
| Loan amount |
Security |
| Upto Rs. 4 Lakhs |
Nil |
| Rs. 4 - 7.5 Lakhs |
- No collateral security required
- Third party guarantee is needed
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| Above Rs. 7.5 Lakhs |
- Collateral security of suitable value is required
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| Is a guarantor a must? |
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| The parent / guardian of the student who is availing loan have to join-in as co-borrower. |
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| What are the tax benefits I get from my education loan? |
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| Tax benefits can be claimed on the interest component of the education loan as per the Income Tax Act, 1961. An amount equal to the interest amount paid can be claimed for deduction under section 80E. |
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| Do I need to open an account with Union Bank of India for availing and/ or servicing the education loan? |
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| Although opening of account is not mandatory for availing a loan, we would recommend to bank with us in order to benefit from other value added services. |
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| What documents do I need to submit to avail an education loan? |
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Please see the Forms & Documents Tab above for information on the list of documents required
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| How much time will it take for my education loan to be approved? |
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| It takes 5 days for your loan to be sanctioned, after you have submitted all the documents. |
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| What are the stages involved in taking a loan? |
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There are three main stages -
- Application - Whereby you submit a completely filled in application with all necessary documents
- Sanction - Whereby you get an approval for a specific loan amount based on the value of your property and repayment capabilities
- Disbursement - Whereby the loan amount is disbursed
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| How do I approach Union Bank of India for a education loan? |
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You can approach us in any of the following ways
- You can visit any of our special retail lending branches called Union Loan Points (ULPs). To locate a ULP, click here
- You can visit any of our branches. To locate a branch, click here
- Request for a contact online
- You can also contact our 24 x 7 Call Centre
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