Who is eligible for medical education loan?[Step-by Step Guide]

Getting an MBBS degree in India can be costly, whether you are a graduate or an undergraduate student. To help with these expenses, many banks offer special education loans for MBBS students. Here is a quick overview of the top five banks providing these loans, including important details and eligibility requirements.

Interest Rates and Conditions of Repayment

In India, the interest rate on loans for medical education is 7.95% annually, with a maximum 15-year repayment period. These loans, with their minimal documentation requirements, online application processes, and moratorium periods, are an excellent method to finance your MBBS studies.

Top 5 MBBS Education Loans Comparing in 2024

The salient features of the top five education loan programs in India for MBBS students are as follows:

1. Axis Bank

• Interest rate starting at 13.70% per annum
• Amount of Maximum Loan: Rs. 50 lakh
• Maximum Period of Tenure: 15 Years
• Fees for processing: 2% of the loan principal

For More Info: HDFC Bank

2. Baroda Bank

• The annual interest rate is 8.55%. onwards
• Maximum Loan Amount: Rs.1.50 crore
• Maximum Tenure: 15 years
• Processing Fees: No processing charges up to Rs.7.50 lakh; 1% of the loan amount up to Rs.10,000

For More Info: Bank Of Baroda

3. Canara Bank

• Interest Rate: 9.25% p.a. onwards
• Maximum Loan Amount: Need-based
• Maximum Tenure: 15 years
• Processing Fees: Refer to the bank’s website

For More Info: Canara Bank

4. Federal Bank

• Interest Rate: 12.55% p.a. onwards
• Maximum Loan Amount: Rs.10 lakh (India), Rs.20 lakh (Abroad)
• Maximum Tenure: 15 years
• Processing Fees: Nil

For More Info: Federal Bank

5. HDFC Bank

• Interest Rate: 9.50% p.a.
• You can borrow up to one crore rupees.
• You have up to fifteen years to repay the loan.
• Processing fees depend on the bank's rules.

For More Info: HDFC Bank

Eligibility Criteria for MBBS Student Loans in India

• Citizenship: Indian
• Admission: Secured through an entrance test or merit-based selection process after 10+2
• Academic Performance: Minimum of 50% marks in Higher Secondary Certificate (HSC) or graduation level

Common Documents Required for Education Loans

• KYC Documents: Identity and address proof
• Academic Records: Mark sheets for SSC, HSC, and degree-level courses
• Financial Documents: Bank statements or passbooks, income proof of co-applicant, guarantor form (optional)
• Admission Proof: Admission letter from the institute, fee schedule
• Collateral Documents: If applicable, property documents, valuation reports, and other collateral-related paperwork

Overview of Education Loan for MBBS in India

1. Loan Limit: Up to Rs.40 lakh (unsecured), up to Rs.2 crores (secured)
2. Covered Expenses: Tuition, examination fees, books, equipment, uniforms, living expenses, insurance, travel expenses, computers or laptops
3. Interest Rate: Starts from 8.55% for collateralized loans and 9.55% for non-collateralized loans
4. Repayment Duration: Up to 15 years including moratorium period
5. Co-applicant: Parents, spouse, siblings, parent-in-law

Education Loan for MBBS Abroad

1. Loan Limit: Up to Rs.75 lakh without collateral, up to Rs.1.5 crores with collateral
2. Covered Expenses: Tuition fees, books, uniforms, equipment, living expenses, insurance, travel expenses, computers or laptops
3. Interest Rate: Starts from 8.55% for collateralized loans and 9.55% for non-collateralized loans
4. Repayment Duration: Up to 24 months moratorium period
5. Co-applicant: Parents, spouse, siblings, parents-in-law

Education Loans for MBBS Without Collateral

• Loan Limit: Up to Rs.45 lakh
• Covered Expenses: Living expenses, books, uniforms, laboratory, tuition fees, accommodation charges, library fee
• Interest Rate: Starting from 9.55%
• Repayment Duration: Up to 15 years including moratorium period

Education Loans for MBBS with Collateral

• Loan Limit: Up to Rs.2 crore
• Covered Expenses: Tuition fees, living expenses, books, uniforms, laboratory, library fee
• Interest Rate: Approximately 8.55%
• Collateral Value: Immovable property valued at 1.25 times the loan amount, liquid security valued at 1.1 times the loan amount

Financial Aid for MBBS Students

MBBS students are eligible to apply for various scholarships to help cover the costs of their education, living expenses, and other fees. A variety of factors are taken into consideration when awarding these scholarships, such as financial need, national or ethnicity, and academic achievement.

How to Complete an Online Indian Education Loan Application

1. Visit the bank's official website to submit an online application for a student loan.
2. Fill out the form with the relevant information.
3. Once the bank receives your application, it will get in touch with you.
4. Send in supporting documentation at your neighborhood branch or online.

Application Offline

• Go to the bank branch that is closest to you.
• Fill up the application and send in the necessary paperwork.
• After examining your application, the bank will get in touch with you to complete the loan.

Typical Issues Candidates Deal with Information Gaps:

• High Interest Rates: High-interest rates can make it challenging to repay the loan.
• Credit History: Students may have difficulty getting loans if they lack a credit history.
• Insufficient Loan Amount: Sometimes, the loan amount is not enough to cover all expenses, making the course unaffordable.

To learn more about MBBS education loans, including eligibility criteria and required documents, check your credit score now and apply for the loan that best fits your needs.

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Author- Ayush Naik 

Ayush Naik is an expert in personal finance with an MBA in Finance. With over five years of experience working alongside stock market traders, Ayush has a deep understanding of market dynamics and investment strategies. His practical insights and analytical skills have helped many individuals navigate the complexities of financial planning and investment. Ayush’s professional background and commitment to educating others make him a valuable contributor to our personal finance blog.