A student loan is meant to help students pay for their higher education, whether that’s the cost of university or an advanced degree program.
Though these loans can be useful, there are some things you may not know about student loans.
For example, who qualifies, what options you have, and how to pay back your loan—that you should know before applying. Here are 10 things you didn’t know about getting a student loan in Pakistan.
Student Loan In Pakistan For Abroad Study | Education Loan
Table of Contents
- Student Loan In Pakistan For Abroad Study | Education Loan
- What is A student loan?
- What Are The Most Common Types of Study Loans?
- How Much Money Can I Borrow?
- Where Can I Find Information About Loans?
- Repayment Plans
- Borrowing From Friends And Family
- Personal Loan (Optional)
- Applying For Multiple Loans At Once
- What Happens If I Don’t Repay My Loan?
- Final Thoughts
- Student Loan In Pakistan FAQs
What is A student loan?
A student loan is a type of debt that’s designed to help you pay for educational costs. In order to receive one, you must first file an application with your lender or financial institution and then be approved.
After that, they’ll decide how much money you can borrow and at what interest rate. Most student loans must be paid back once you graduate or drop below half-time enrollment (roughly 12 credits per semester for undergraduates).
While most loans don’t charge interest while students are still in school, some do; if your loan does, interest will be capitalized—meaning added to your balance—once school ends.
What Are The Most Common Types of Study Loans?
There are many different types of student loans that you can choose from, including subsidized and unsubsidized loans and PLUS loans (in the US). Each type of loan comes with certain benefits.
The three most common types of student loans that you’ll come across include subsidized student loans, unsubsidized student loans, and private education loans.
Make sure to read up on what each loan entails and which one is best for your financial situation before applying. And always compare interest rates so you can choose a low-cost lender!
How Much Money Can I Borrow?
Like with anything, it depends. Each school sets its own financial aid budget, and how much you actually get to borrow from that pool depends on several factors:
Your income, assets, and family size (your parents’ assets are factored into all of these). The bigger concern is what happens if you don’t qualify for enough financial aid—will you be able to pay for college out-of-pocket?
If not, what backup plan do you have? It’s best to fully investigate all your options before enrolling at any college or university, and remember that merit-based scholarships can help offset some costs.
Where Can I Find Information About Loans?
This is one of those questions that can’t be answered with an online search. If you want to know about getting student loans in Pakistan, you need to ask someone who has done it!
After your application, you will also likely be invited to a personal consultation. This meeting is held by individuals familiar with your case and will have information regarding loan options based on your unique circumstances.
If a private student loan doesn’t seem like it fits into your plans, take some time to explore government loans—Pakistan is home to a number of grants and initiatives that can help students fund their education. By doing some preliminary research, you may find something unexpected!
Many people are not aware of the simple fact that student loans are one of the cheapest and most convenient forms of financing.
The interest rates for student loans are very low, which means that you will be paying back your money at a comparatively lower cost. The best part is you have multiple options as far as repayment is concerned.
For example, you can pay off your loan in anywhere between 1 to 30 years. Thus, if your monthly income is very low or if there is any other kind of financial difficulty keeping you from making timely payments.
Then, there will be no problem at all because these loans give you enough flexibility to set up an easy payment schedule that works best for your income and requirements.
Borrowing From Friends And Family
Borrowing from friends and family is a great way to avoid student loans. You might be able to ask for money from your parents, grandparents or other relatives. If you have close friends, they may also be willing to help you out with a loan.
This can save you time and money in the long run because it’s likely that people close to you will have lower interest rates than banks do. Plus, there’s no need for someone else to pay for your education if you don’t want them to!
Just 20% of college students use student loans. Instead, many young people borrow from relatives or friends—and wind up paying higher interest rates as a result.
Personal Loan (Optional)
The amount you will get as a student loan is pretty low. The average limit set by banks and other financial institutions is very low. This may not be enough for those who wish to pursue higher education or do masters abroad.
In such cases, it would be good to go for a personal loan. Most of these loans don’t require any collateral or even a guarantee of income.
This is one reason why they have become very popular among students and recent graduates looking for money to fund their studies and other expenses.
Applying For Multiple Loans At Once
It is possible for students to apply for multiple student loans at once. It is advisable to have a good credit score, a steady income, and good academic history.
Financial institutions that offer study loans are Islamic banks, local commercial banks, and foreign lenders. Some of these financial institutions offer more options than others.
For example, Islamic banks do not offer scholarships or interest-free loans but they do offer the possibility of an increasing repayment scheme while local commercial banks only offer interest-free study loans.
Foreign lenders are the most expensive, but can also be the most flexible with their loan schemes and repayment plans.
Students can end up paying more money by submitting multiple applications for multiple loans at once. The problem arises when one or two of those applications are denied, which generally happens if your credit history is not good.
What Happens If I Don’t Repay My Loan?
It’s important to know what can happen if you fail to repay your loan. In fact, one of the biggest reasons people choose not to pursue a student loan is because they are afraid they will lose their professional license (e.g., doctor, lawyer, etc.).
if they default on their payments. However, there is no such thing as professional disqualification for defaulting on student loans. So let’s explore what does happen when you don’t pay back your loan.
When you fall behind on your payments and do not make arrangements with your lender, here is what can happen: Your wages may be garnished, and/or legal action may be taken against you.
A student loan can be one of your first major expenditures. With no other funds to rely on, it’s important that you do everything possible to know what you’re getting into before signing on the dotted line.
It helps if you ask yourself some questions about what kinds of loans are available, how much money you might be eligible for, and more.
Student Loan In Pakistan FAQs
Who Offers Interest-free Student Loan In Pakistan?
Akhuwat Foundation offers interest-free student loans in Pakistan from 10,000 to 50,000.
How Much Loan Students can get from Pakistani Banks?
Pakistani Banks offer 25,000 to 300,000, depending upon the qualification, duration, and type of degree students are pursuing or going to do.
If you have any questions contact us (email) at Contact@personalloan.pk | Personalloan.firstname.lastname@example.org or leave us a comment, we would love to answer all of your queries. Thanks for reading!