What are the Pros and Cons of Education Loan for student?
If you were born lucky, paying for a master’s, doctorate, or college is probably the easiest thing on this planet for you.
However, if you are living in the real world, the cost of tuition for “the school of your dreams” may be sky high and this could be an impediment to continue growing in the professional field.
The good thing about it is that when one can no longer pay exorbitant monthly payments, “educational credits or financing” enter the removal.
They throw unemployment in case we do not have enough money to support (month after month) the expenses of whatever we are studying.
What is an educational loan or financing?
Basically, it is that which will help you pay for your university (master’s, doctorate, or whatever you have in mind).
Financing is not synonymous with “my studies will be free forever”.
The reality is that all that wool that the financial company is lending you, you will have to pay later and with extra interest.
Like it or not, that’s right, that’s why we made a list of pros and cons to consider if you want to contract financing or educational credit.
“A financing allows to lower the monthly tuition fee. They pay the university the amount that the student cannot cover and at the same time, they are offered a payment plan ”.
The most basic requirements in the world to apply for a student loan
- Be Citizen
- Have a guarantor between 18 and 65 years old who has a good credit history (this is essential) and who can prove your income.
What you should never forget in this life
- Check well which financial institution you are trusting. Many times, the school where you want to study has agreements with some educational loan companies, ask your school what agreements exist before looking for it outside.
- Hiring financing is not a game. ” You should contact an educational loan/financing only if:
- The career you want is little known, it is very expensive and few schools offer it
- You are flat out not enough to pay it
- You are sure that you will be able to pay for it once you finish studying
- It is the law to read everything, everything, the entire contract. We are talking that they will finance you a good amount of money, so you do not have to be so confident in life. Any questions you have, any strange word, percentage, or clause that you do not understand, let us know and clarify the doubt. It is not going to be that after a while you end up paying much more than you thought.
- Ask if the interest rate you will pay is fixed or variable. Most financial companies take care of your total debt and once you finish university (or whatever you are studying) you will begin to pay the monthly payments agreed in your contract. But anyway ask.
- What does the financing cover you? Suppose you have a scholarship and sadly you fail and lose it, what would happen? Does the finance company absorb that extra expense? Confirm if they will also take charge of registrations, qualifications, extraordinary exams and other expenses that are coming out …
- Check when you will start paying the finance company (usually, it starts when you finish your studies), how much money and until what year your debt will be dissolved.
The advantages of having an educational loan
- If you pay on time, we promise that your credit history will be stuck in the honor roll of the Credit Bureau.
- The financier will ask you your income, expenses and together they will reach an agreement to defer payments and specify your payment date.
- Having such a large financial commitment makes your brain focus on being much more orderly with your personal finances.
- Being a student it feels good father not to have to worry about the next semester that you have to pay. Now the financing ones are the ones who will take care of that.
The disadvantages of contracting an educational loan
- It is common for interest rates to go up and up over time.
- If you stop paying, your credit bureau record will be spoiled.
- If you do not have money to pay to finance (no matter how minimal) it is better not to risk it.
- There is no other way, all that money that they are lending you will have to be paid at some point in your life.