Private Educational Loans

There are two parts when we say “Private Educational Loans”, one is “Education” and another is “loans”. Inspired kids, always look up to their role-models and start to dream about their own identity and that’s when they start exploring the world of opportunities alongside cutting a niche in this intellectual world.

In today’s time it is necessary to have a butt-load of money in order to afford ‘premier education’. It can just be even said ‘education’ instead, taking ‘premier’ out of the question. There are actually too many financial hurdles which shatter the dreams into pieces leaving behind ‘numbness’. No doubt, parents/guardians do everything in their control to acquire a ‘Govt. Loan’ but then the no. of applicants for this is always too much that “Private Educational Loans” come as a ladder to next level.

At times when one qualifies for ‘Govt. Loan’, the amount differs from the tuition fee and other expenses. (These days the tuition fees is increasing at a rapid rate but Loan amounts are not)  However, Private Educational Loans stretch as far as requirements are foreseen. And which is why they become a preferred choice.

These Private Loans are easy to acquire as there are several companies providing the same. It’s a systematic process for application to such loans and the candidates/parents are strongly advised to understand the process thoroughly to avoid any unseen circumstances later on. It’s as good as booking an air-ticket with a band of airlines available for the destination of choice. Prepare an itinerary with various companies providing these loans and especially go through these four vital things:

  1. Monthly Payment Terms
  2. Interest Rates
  3. Rate-Reductions
  4. No Repayment Penalties 

Having done this, it is also crucial to investigate on the company’s credibility & reputation as a Private Loan Lender.

 

Unlike, Govt. Loans, Private Educational Loans will require a signing-authority/guarantor, just in case the person taking the loan is unable to pay back the loan, it will be on-to that guarantor to pay back the same. It’s also important to have a guarantor who has good credit-ratings of his/her own so as to generally avoid the rejection of the loan application.

 

There can be “School-Channel Loans” or “Direct-Loans”. As the name suggests, some schools have their own policy of Loaning or have an association with one of the Loan companies’ in-order to facilitate the large crowd at one place. And direct loans anyway are provided directly to the person with no-third party involvement except the guarantor.

 

There can be several trade-offs in between the loan options. For example, there can be a ‘home-equity loan’ or an ‘insurance-policy’ tagged along with the Private Educational Loan, so as to provide benefits in various formats of business.

 

Commercial Loans

The Commercial Loans are the loans given to companies from financial institutions for the expensive upfront costs and regularization of many things such as infrastructure cost, employee salaries, bank-debt, equity investments etc. These loans are generally sufficed for the large investment or capital expenditures which the company or business may not afford at that very moment.

Commercial Banks servers on dimensions to respective domains with a wide range of product-line including Non-Fund Based Lines, Overdraft facility, Secured Term Loans etc. The entire financial requirements are taken care by these loans so that the business houses or the companies keep moving ahead and grow in their own trail. There can be perky coupons attached with such loans in the regard of making them more attractive which may or may-not be confined to the ‘unique benefits’, ‘business analysis’, ‘deals & discounts’, ‘rewards’ etc. These can generally be on, large businesses houses perks.

Finding the right party to lend you such a loan is not an easy task. It is sometimes co-related to the choosing of a “wall-color” for your house. It looks ‘white’ but has too many shades of the same which makes it hard to choose from. Especially when talking about the real-estate sector, these loans are given to commercial property owners at a rate significantly less than the property that is used as collateral.

The Commercial Loans are designed in many formats for different domains. It’s similar to the designing of a savings account, like its different for mass-markets, different for middle layer and then comes the premier tier accounts. Similarly, for SME, loan plans differ for those of big-corporate houses and Too-Big-To-Fall houses. The actual financial capacity of the company requesting for the Commercial Loans is measured & only after that they are fit in to a designed plan.

Below mentioned are a few plans for Commercial Loans provided by one of the banks:

  1. Secured Term Loans:
    1. Loans against stock and book debt & against property
    2. Commercial Property Purchase allowed up to Rs. 4.8 crores*
    3. Maximum LTV (Loan to Value) of 80%* for property backed lines
    4. Ideal for MSME sector requirements
  1. Quick Loans:
    1. Loans up to Rs. 25 Lakhs, especially designed to suit the needs of MSME Segment
    2. No Collateral Security
  2. Overdrafts:
    1. Short-term loans
    2. Annual renewable lines
  3. Dropline Overdrafts:
    1. Combination of Term Loan & overdraft
    2. Interest charged only on the amount which isn’t utilized.
  4. Import-Export Finances:
    1. LIBOR denominated rates on Buyer’s Credit, Pre/Post Shipment Finance

The above plans have their own requirements of documentation and purposes, in the major calculation are: letter of credit, bank guarantee, forward contracts etc.

Overall, to apply for a Commercial Loan, one needs to be on his toes while choosing the right plan into the right segment and according to the needs at that moment.