Education loans have come to play a significant role in the lives of students who wish to pursue higher education from world-class educational institutions in India and abroad. Education loans help students acquire quality education while easing the financial burden on their parents. Owing to their many benefits, education loans have become a preferred choice over self-finance. These benefits include tax savings, up to 100% finance, easy and flexible repayment terms etc.
Some of the ways in which education loans are better than self-finance are:
Education loan offers significant savings in the form of tax benefits under Section 80E. Under Section 80E of the Income Tax Act of India, an assessee, who takes an education loan for self, spouse, children, or a student of whom the individual is a legal guardian, can claim deduction during repayment of interest on the education loan. This deduction can be claimed for a total of 8 years (the year in which the borrower starts repaying the interest and for 7 succeeding years) or till the interest on the education loan is fully repaid, whichever occurs earlier.
Moreover, there is no upper limit on the amount of interest that can be deducted from the taxpayer’s taxable income. Hence, the loan applicant can claim tax benefits on the entire interest paid on the education loan.
In addition to tuition fee, there are various other costs that are associated with higher education. These additional expenses may include living expenses, library & examination fee, college deposits, cost of books/uniform/equipment and travel fare etc. Hence, the complete cost of education goes high above the tuition fee. Self-financing higher education may cause you to lose a large portion of your savings. Whereas, education loan covers all these expenses while you keep your savings intact for contingencies.
Key reasons that make HDFC Credila a trusted source of funding higher education are:
HDFC Credila is the only NBFC which gives education loan applicants tax benefits under Section 80E of the Income Tax Act of India, 1961. Tax benefits lower the effective rate of interest and make your education loan cost-effective. Hence, HDFC Credila gives you the privilege to save money with your education loan. The Gazette Notification of HDFC Credila can be viewed at https://www.incometaxindia.gov.in/communications/notification/920110000000000492.pdf
Most banks require borrowers to pay a certain percentage of the complete cost of the education which is known as Margin Money. In some cases, this can be as high as 15-30% of the complete cost of education. HDFC Credila offers education loans that cover up to 100% of the complete cost of education.
HDFC Credila is the only financial institution that lets students apply for loan even before their admission is confirmed. This helps students in knowing their loan eligibility in advance and also avoids the last minute hassle of arranging funds once the admission is confirmed.
Other unique benefits offered by Education Loan from HDFC Credila are:
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To know more about HDFC Credila’s Education Loan, visit our website www.hdfccredila.com or call at our toll-free number 1800-209-3636.