Decoding Overseas Education Loan Process for United Kingdom
The United Kingdom is one of the top three study abroad destinations and every year thousands of students migrate to this beautiful country for pursuing their higher education. Known world-wide for its high quality of education, globally reputed universities, ample part-time work and post study work visa opportunities, UK offers everything that an study abroad aspirant wishes for.
A bachelors degree in the UK is of three years whereas the duration of a masters program is of 1 to 2 years. The tuition fee for bachelors and masters degree falls somewhere between 10 to 30 lakhs per year. However, the tuition fee defers from one university to another depending on the factors like university ranking and location of the university.
To fund an international degree in the UK, Indian students opt for a foreign education loan. We know that the process of an education loan for higher studies abroad is quite confusing for a lay man. But fret not as in this article, we will discuss everything relating to an overseas education loan to fund an international degree in the UK. So, without further ado, let us begin!
Eligibility criteria for an Overseas Education Loan for United Kingdom
To avail an education loan for UK, students are required to meet both academic and financial requirements. Read on to know.
Academic Eligibility: Students should have a decent academic qualification with less backlogs and no academic gap to get the education loan sanctioned from financial institution.
Financial Eligibility: If the student is availing a Secured Education Loan, there is no income criteria for co-borrower whereas in the case of Unsecured Education Loan, the minimum income criteria for co-borrower should be more than 6 lakhs with no liabilities.
Acceptable Sponsorer: As per visa immigration norms for both secured and unsecured education loan, only parents, siblings and grandparents are considered as sponsorer.
Acceptable Financial Institutions: The banks regulated under Reserve Bank of India are only accepted for overseas education loan.
What are the expenses covered in an Overseas Education Loan?
For Secured Overseas Education Loan and Unsecured Overseas Education Loan, following are the things that are covered:
Tuition fees, examination fees, library fees
Expenses of books, laptops, uniform and field visit if any
Living expenses, travel fare and other expenses required for the completion of the program.
Flowchart - Overseas education loan process for United Kingdom
To get a clear idea relating to an education loan for UK, here is the step-by-step guide right from university application process, to getting loan letter sanctioned till visa approval.
Step 1: Students must submit the application for admission at the desired university.
Step 2: Student will receive the conditional offer.
Step 3: On fulfilling the steps involved in conditional offer, students will receive the unconditional offer letter.
Step 4: Based on offer letter, student will approach the financial institution and submit the overseas education loan application.
Step 5: After approval of the loan, students will be required to pay the initial deposit for the tuition fees to block the seat.
Step 6: On initial payment, students will receive the Confirmation of Acceptance of Studies (CAS) from the university.
Step 7: Based on CAS, students are required to apply online for the Tier 4 Student Visa to study in the UK.
Step 8: Students will be allotted a specific time and date for their biometric and medical document submission.
Step 9: Within a span of 10-15 days, students will receive a visa via courier, or they will be required to collect it in person.
Step 10: Fly to UK
Tier 4 Student Visa Guidelines for Education loan in UK
On receiving the offer letter from the university, students availing education loan will be required to meet the following visa requirements:
Student must have applied for proper education loan as home loan, gold loan, personal loan, loan against property (LAP) will not be accepted.
The education loan should be in the name of the students only. If the parents are co-borrower then it should be clearly mentioned on the education loan letter.
As per the latest UKVI rules, the following text needs to be included in the loan letter- “This is to confirm that <Name of The Bank> is regulated by the Reserve Bank of India (RBI)”.
The condition for the loan amount disbursement should be as follows:
“After procurement of successful tier 4 VISA, Loan funds will be available to student before he/she travels to UK”
“Tuition Fees will be disbursed to University and Living expenses will be disbursed to student before he/she travels to UK”.
Students are required to pay the deposit amount to secure the seat before applying for a student visa. After the successful payment of an education loan, students will have to avail a disbursement letter.
The education loan should be unconditional and must be printed on a letter head with the bank logo and the date of issue.
As per the visa norms, students are required to show only one-year of tuition fees and living expenses for both bachelors and masters program.
Education Loan availing via NBFCs
Private institutions like Avanse, Auxilo, InCred does not provide an education loan sanction letter in the UK-VI Format except Credila. Hence, students applying for education loan at any of the above mentioned NBFCs, following are the steps for getting a loan approved for higher education abroad:
Step 1: Apply and get the education loan sanctioned from the NBFC.
Step 2: Get the loan amount disbursed in student saving’s account.
Step 3: Maintain the balance in saving account for 28 days as per the visa norms.
Step 4: Take bank balance certificate and update the passbook for the processing of the visa application.
Living Expenses while studying in the UK:
International students studying in the United Kingdom comes under Tier 4 (General) student visa and they will be required to show the monthly living expenses needed while studying in the UK.
If the students are studying in London city, they are required to show the living expenses of £1,265 in London and £1,015 outside London for per month.
National Health Insurance:
The National Health Insurance is the UK’s state healthcare system that provides a wide range of health care services ranging from the appointment with the doctors, emergency hospital treatments, diagnosis and treatment of certain communicable diseases and dental care.
It is compulsory for all the students to get the national health insurance for studying in the United Kingdom. For that, they are required to pay a healthcare surcharge of 470 GBP per year before visa application.
What is the right time to apply for an overseas education loan in the UK?
Once you get an offer letter from the university, you should proceed to apply study loan for abroad studies at the earliest as the validity of the loan letter is of 6 months. Hence, do check the commencement date and apply accordingly.
How ELAN Loan will speed-up your UK education loan application process?
At ELAN Loans, we will assist you in everything right from applying for education loan, getting the loan letter in the UK-VI format, coordinating with the financial institution, and getting your UK education loan sanctioned.
In short, we will assist you in overall education loan process for your UK application. So, book a free appointment with us today.