Good Credit for a Good Future

It is All About Give and Take:

If you’ve set your sights on the university of your dream, and if it is time to decide to take a loan here are a few things Avanse wants you to keep in mind: An education loan is a consumer loan. It is designed to bridge a financial gap and in the process help you pursue your dream. But, borrow only what is needed to cover your educational expenses, and only after you ascertain your loan amount. If possible, plan your entire potential-expenses. Make a realistic budget and most importantly stick to it.

If you are planning on taking a loan, do your research well before time. Knowing differing requirements of universities and the places they are based in, as well as loan disbursement policies of different financial institutions, only help you make educated decisions. Just because you are eligible to borrow does not mean you should avail of the maximum that the lender will disburse. No matter what, remember that you have to pay back your principal amount AND the interest.

Repaying your loan on time helps in multiple ways. Most of all, it will help you to establish a good credit rating. Select a lender that provides easy application procedures, quick processing of your application, fast notification, and special student services such as toll-free telephone numbers for information and advice interest. Your chances of getting one with the most favourable terms and conditions are better. Ask questions. No question is a stupid question. Pay off your loan instalments as and when they are due. Don’t forget to keep the lender aware of progression or change in your correspondence address if any.

Once you have taken an educational loan, paying it back is a legal obligation. See that you do your repayment in time. Delay or any hitch in paying back leads to unwanted credit related situations.

Importance of good credit

At Avanse we believe in equipping our customers with the right information. An education loan is probably the first step that the student takes on his road to financial independence; hence we believe that a good understanding of one’s credit is important.

A credit history is a collection of all the pieces of financial information that relate to your life. It contains information on how long you have been maintaining your accounts, the limits associated with it and how good your payment history has been.

This is vital to future and current creditors as this shows the merit of the credit they advance you i.e. the probability that you will repay. Because you have handled your credit well in the past, is proof enough of your credit behaviour in the future. The credit report gives a snapshot of your financial life. This arms financial institutions with the information they need to decide whether they should lend or extend credit to you or not. Learning how to establish and maintain good credit will help you achieve your financial goals.

Benefits of inschool repayment

Avanse understands that loans are often necessary for many families, to help meet the cost of higher education for their children. Though the cost of education is ever rising it is important to know and understand how to balance these debts. If not done responsibly, managing this after graduation can become an overwhelming task. Education loans do accrue interest while the student is in school and this continues to compound over the duration of enrolment. Avanse offers you the following in-school payment options:

  • EMI Payment during course
  • Interest Servicing during course
  • Partial Interest Servicing during course

In-school payments allow the student to make an EMI payment or a standard minimum monthly payment towards the interest of the loan, thus developing a healthy debt repayment habit. Not only do you greatly reduce outstanding debt, you also lay a foundation to good credit history for future loans after graduation. The ability to make a payment towards loans while in school has been ignored by the public at large, giving rise to serious credit consequences that affect the student’s future borrowing capacity.

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