Securing a personal loan as a student can be a practical solution to manage unexpected expenses or cover various personal costs. While most traditional loans require a steady income, there are ways for students to qualify with the help of a guarantor or alternative sources of income.
In this article, we will explore how students can apply for personal loans, the eligibility requirements, necessary documents, and key considerations to ensure responsible borrowing. Whether you're facing immediate expenses or need extra financial support, understanding the ins and outs of student personal loans can help you make informed decisions.
A personal loan is unsecured, meaning it offers a lump sum to cover a multitude of personal expenses. They're not secured loans in which you would pledge your cash or real estate to collateralize the loan, but unsecured loans, just like mortgages or auto loans are. So, you do have flexibility in taking the loan to manage unwelcome costs.
Indian banks and fintech companies often do not offer student personal loans. In addition, most lending agencies require a steady source of income to approve personal loans. Here's how to still qualify if you're an unpaid student:
Under some conditions, students without income can still obtain personal loans. Such as, if a parent or sibling acts as a guarantor for them or they are making money through freelancing or part-time employment. Students without a steady source of income may be eligible for immediate personal loans from some financial institutions.
No, student loans are not education loans:
The loan limit of a student is determined by several factors such as his income, credit score, and the restrictions of the lender. Most Indian financial institutions offer students without income personal loans up to ₹5 lakhs as long as the guarantor supports the loan.
These are some of the common paperwork requirements, but they are different for the lender.
In conclusion, there is a long list of the paperwork involved in securing a personal loan. With such expenses on the student's head, it could help them out with these expenses and let their path continue smoothly toward academics. But borrowing requires a prudent approach. A personal loan may bring you the money you will need to focus on fulfilling your academic goals if planned and borrowed responsibly.
(Note: Raising a loan comes with its own risks. So, due caution is advised)
Catch all the Instant Personal Loan, Business Loan, Business News, Money news, Breaking News Events and Latest News Updates on Live Mint. Download The Mint News App to get Daily Market Updates.