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Education Loan Disbursement Process for Abroad

Education Loan Disbursement Process for Abroad

Preparing for a foreign education course can be an exciting process. And a crucial part of this is an education loan. These convenient credit vehicles help you finance your educational dreams without compromising your financial stability. What’s more, leading financial institutions offer these at competitive interest rates and flexible tenures, making them even more attractive to students.

However, a common ambiguity surrounding education loans is their disbursement process. As the last leg of the journey, this involves receiving the loan amount and can be confusing for some. If you’re looking to gain clarity on this, you’re in the right place.

Here, we discuss everything you need to know about the education loan disbursement process for abroad, from what it is to how long it can take.

What Is the Education Loan Disbursement Process for Abroad?

An education loan disbursement process for abroad refers to the release of the education loan amount into the applicant’s account. This is the final stage of your loan application process. After this, you are required to repay the loan post the completion of your studies.

The total loan amount is usually disbursed at periodic intervals at the beginning of a fresh academic year or semester. Generally, the lender coordinates this with the university or college and is responsible for the timely release of the loan amount.

Education Loan Disbursement Process for Abroad

Here are the stages involved in the education loan disbursement process for abroad:

1. Receive the Loan Sanction Letter

Your chosen lender will issue a loan sanction letter once your application and documents have been verified and approved. Be sure to pay all charges, such as processing fee, stamp duty, etc., if applicable, for a smooth process.

2. Sign the Education Loan Agreement

Next, you will be required to sign the loan agreement prepared by your chosen lender. Your co-borrowers or guarantors will also be required to sign it. Make sure all relevant parties are present to prevent delays in the disbursement. The loan agreement is a formal contract that includes all crucial details regarding the loan, such as interest rate, tenure, repayment terms, etc.

3. Provide All Disbursement Details

Once you and your co-borrowers or guarantors have signed the loan agreement, you must provide your loan disbursement details. This involves informing the lender about when you need the loan amount. This is usually after you receive your visa or the final date of course fee payment. Be sure to inform the lender whether you need partial or full loan disbursement.

4. Specify the Mode of Disbursement

Lastly, you need to inform your lender about the mode of disbursement. The lender will typically pay the tuition fee to the university or college directly. Alternatively, they might prepare a demand draft as per your instruction. Some educational institutions in America might prefer tuition fee payment via third party services such as Globalpay, Flywire, etc. Be sure to inform your lender of the same.

What is an Education Loan Disbursement Letter?

An education loan disbursement letter is a formal document that is provided to you by your lender. This letter must be submitted to your educational institute as proof of financial support. Further, you can initiate the disbursement process only after receiving your loan disbursement letter.

How Much Time Does the Education Loan Disbursement Process for Abroad Take?

The time that the education loan disbursement process for abroad courses will take depends on your chosen lender’s process. Lenders can typically take anywhere between 7-15 business days or up to a month to verify your loan application and documents. The loan is usually disbursed within 4-7 days after you receive the sanction letter.

To Sum Up

As you’ve read above, the education loan disbursement process for abroad is pretty straightforward. All you need to do is submit the duly filled application form, attach all documents and wait for your loan to be approved. Once done, you can collect your sanction letter, sign the loan agreement, share disbursement details, and specify the mode of disbursement.

If you’re looking for a reliable financial partner for your education loan, consider Tata Capital. We at Tata Capital offer education loans at attractive interest rates, flexible loan tenures, easy eligibility, hassle-free documentation, and quick application processes.

Add wings to your dream. Apply for an Education loan!

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