Taking an education loan? You have to furnish name of guarantor

Taking an education loan? You have to furnish name of guarantor

You have to furnish name of guarantor for education loan
I am taking a joint loan with my wife. Is it mandatory to give the name of a guarantor for the loan?
– Ketan Goptu
Most loans from banks these days do not require guarantors. Only in specific situations, usually in education loans, they will require a guarantor, whose net worth is at least good for the loan being given. Typically for a home loan, car loan, etc., there is no need for a guarantor.

I have some spare money. Should I repay a part of my home loan instead of investing in bank fixed deposits?
—Varun Chug
Look at the interest rate differential. If you can make at least 2% per annum more than what your bank is charging you on your loan, then you should go ahead and invest. Otherwise, it is advisable to reduce your liability.

I want to send my son to London for higher education and we need a loan of `1 crore. Is there any limit on education loan for studying abroad?
—KR Ravi
Most scheduled banks in India will give you a loan of `20-50 lakh for study abroad. Axis Bank does not have an upper limit. Also, there are a few NBFCs (Avanse, Credila) which specialise in education loans, who do not have a maximum limit, provided other criterions are met.

I plan to purchase a car for `8 lakh. I need a loan of `5 lakh. Should I go for a three-year or five-year tenure?
—Gautam Rajput
Maximum tenure of an auto loan is seven years. Ask for prepayment charges and the period in which prepayment is not allowed, before availing the loan. Then decide to go for a longer term loan with the flexibility to pay off earlier, as and when you have extra funds. This way your monthly obligation of EMI will be lower.

I applied for PMAY in LIG category but it got rejected due to no women owner-ship. Since there are no women in my family, what should I do?
—Pravin Vijayraghavan
Under PMAY LIG, ownership of the house should be in the sole name of the female member of the household or joint ownership with the wife. However, under Credit Linked Subsidy Scheme (CLSS)- MIG, an adult earning member, irrespective of marital status, may be treated as a separate household and can avail subsidy under CLSS independently.

The writer is founder, AZUKE Personal Finance Advisory (Website: www.azukefinance.com). Send your queries to [email protected]