Indian students are traveling abroad in recent years to pursue higher education. Students have been drawn to popular study abroad destinations because of the top-tier universities and exciting career opportunities. These students borrow money to pay for their other expenses as well as their education. It can be difficult to apply for student loans. This process involves numerous steps. The co-applicant is one of the key players in this group. The co-applicant’s profile is given more weight when taking out an education loan for study abroad without collateral, especially when working with private banks and NBFCs
This article will concentrate on the co-applicant’s role in the education loan. Let us go through the details of the Co–applicant.
Who is a Co-applicant?
An education loan co-applicant is the individual who signs and assumes the loan applicant’s obligations. In the event that the applicant is unable to repay the loan, the co-applicant will be accountable for making the repayment. Family members of the loan applicant are required to be co-applicants. An ideal co-applicant would be the candidate’s parents.
You now know the definition of a co-applicant, so let us know about the different kinds of co-applicants.
Types of Co- applicants
A co-applicant can be either a primary co-applicant or a financial co-applicant. Let’s look at how the two differ from one another.
- Primary co-applicant
The primary co-applicant is the applicant’s parents. This type has no impact on the financial profile. - Financial co-applicant
The loan applicant may financially be a co-applicant with any blood relative. Siblings, maternal uncles, maternal aunts, paternal uncles, and first cousins are among the family members who are eligible to submit a financial co-application.
Who can be the Co-applicant?
Listed below is the list of co-applicants who meet the eligibility requirements and have been approved by these lenders.
- Government banks – Parents, Parents-in-law, Siblings, Parent’s siblings, Spouse, First cousins.
- Private banks – Spouse, Parents, Siblings, and Parent’s-in-law
- NBFCs – Parents, Parents-in-law, Siblings, Spouse, Parent’s siblings, First cousins.
What is the role of a Co- applicant?
The secondary applicant in the loan process is a co-applicant. If for whatever reason the applicant is unable to repay the loan, it is their responsibility to repay the amount. The co-applicant’s function as the bank’s point of contact is especially important because the applicant will be leaving for the study abroad location.
Eligibility criteria of the Co- applicant
Both secured and unsecured overseas education loans have a significant role for the co-applicant. Examining the co-applicant’s eligibility requirements will help us.
- CIBIL Score
For profile analysis, the co-applicant’s CIBIL score is an essential requirement. For this loan to be approved, the co-applicant must have a high CIBIL score. - IT Returns Documents
Co-applicants must provide documentation of their IT returns from the previous two fiscal years. - Proof of Income
Proof of Income like salary slips if the co-applicant is employed or Business Registration Certificate and bank account statements if the co-applicant is self-employed should be submitted to the lenders.
We have made every effort to include a co-applicant’s details. You can ask any of the top overseas education loans questions if you’re thinking about pursuing higher education abroad and you’re not sure how to apply for an education loan for studies abroad.