Role of Co-applicant in Abroad Education Loan
Indian students are now frequently traveling abroad to complete their higher education. The best colleges and a thriving job market have been cited as reasons why students prefer to travel to well-known study abroad locations. These students borrow money to pay for their education as well as other costs. Applying for student loans can be time-consuming. This method involves numerous people and steps. The co-applicant is one of the other individuals who is significant. When applying for an education loan without collateral for studies abroad, NBFCs and private banks place a premium on the co-applicants profile.
The role of the co-applicant in the education loan will be the main topic of this article. Let’s look over the co-applicants information.
Who is a Co-applicant?
The individual who signs and assumes responsibility for the loan application is known as a co-applicant. It will be the co-applicants responsibility to repay the loan amount if the applicant is unable to do so. Family members of the loan applicant must be co-applicants. The applicant’s parents make a good co-applicant. Co-applicant is another word for co-borrower or co-signer.
Since you now know what a co-applicant is, please describe the different kinds of co-applicants.
Types of Co-applicants
Primary co-applicant and financial co-applicant are the two different categories of co-applicants. Let’s examine how these two differ from one another.
- Primary co-applicant
The applicant’s parents are the primary co-applicant. In this category, the financial profile is irrelevant.
- Financial co-applicant
For any blood related the loan applicant may apply as a financial co-applicant. Siblings, paternal uncles, paternal aunts, maternal uncles, maternal aunts, and first cousins can all be financial co-applicants.
Who can be the Co-applicant?
Various lenders have varying requirements for co-applicants eligibility. The list of co-applicants that these lenders accept is provided below based on the qualifying requirements.
- Government Banks: First cousins, siblings, parents’ siblings, spouses, and parents-in-law are all eligible to use government banks.
- Private banks: parents, in-laws, siblings, and spouse
- NBFCs: NBFCs, such as parents, in-laws, spouses, parents’ siblings, first cousins, and siblings.
What function does a co-applicant serve?
In the loan application process, a co-applicant is recognized as the secondary applicant. The applicant’s responsibility is to guarantee repayment of the loan sum in the event that the applicant is unable to do so. Since the applicant will depart for the study abroad location, the co-applicants position as the bank’s point of contact is also crucial.
Eligibility criteria of the Co-applicant
An important consideration for both secured and unsecured overseas education loans is the co-applicant. Let’s examine the co-applicants eligibility requirements.
- CIBIL Score
An important criterion for examining the co-applicant’s profile is their CIBIL Score. For the co-applicant to be approved for the loan, they must have a high CIBIL score.
- IT Returns Documents
Co-Applicants must present documentation for their IT Returns from the last two fiscal years.
- Income Verification
Lenders will need to see proof of income, such as pay stubs if the co-applicant is employed or a business registration certificate and bank account records if the co-applicant is self-employed.
We did our best to cover all of a co-applicant’s information. If you want to pursue higher education abroad and you have questions about how to apply for an education loan for international studies, you may get in touch with any of the top companies offering foreign education loans.