Student Loans for Canada A Complete Guide on How to Obtain a Study Loan in Canada 2023

Canada is a defining destination for international students from all over the world. The best universities provide a wide range of experiences and opportunities. However, this is the cost of Apart from the tuition fee and living expenses, the student is also required to fund CAD 10,000 for a Guaranteed Investment Certificate (GIC) at banks such as CIBC and SBI Canada. One option to pay for your education within Canada is to take the study loan option there. The education loan in Canada is a great alternative to receiving financial aid for higher studies in Canada. In this post, we go over everything you should know about the study loans available in Canada and their various kinds, eligibility requirements, the best loan providers, and much more.

Different types of loans for education in Canada

Collateral Loan (Secured Loan)

Non-collateral loan (unsecured loan)

Let’s go over it in detail:

1. Collateral Loan in Canada

This kind of student loan in Canada will require the borrower to offer some form of collateral to secure the loan. The collateral is given to the lender in the amount of the loan. The collateral for this type of education loan in Canada includes the following:

tangible assets such as land (non-agricultural) or houses, flats, houses, or similar structures.

Intangible assets like life insurance, fixed deposits, government bonds, etc.

The government banks of India mostly lend secured educational loans to students studying in Canada. The maximum amount of loan given under any bank’s government education plan is contingent on the amount of collateral security.

2. Non-collateralized loans in Canada

This is the second kind of education loan available in Canada. The applicants don’t have to make a pledge of any security to be eligible for the loan. There must be a co-applicant with income, which is the determining factor for loan sanction. If you are looking for a student loan to Canada in India,Keep in mind that private lending institutions and a handful of international lenders offer student loans that are not secured. Unsecured education loans are generally offered by NBFCs and private banks such as ICICI Bank, Axis Bank, and others.

How can I get a study loan in Canada?

The process of approving a loan for education within Canada is a long-winded procedure. You should begin the process about 7 to 6 months prior to when your course starts. Here’s a step-by-step guide to getting a loan for students in Canada:

Find out which banks provide loans for international students from Canada, as well as the eligibility criteria and the documents needed.

Calculate the amount of money required to study in Canada for the programme you want to pursue.

Find the acceptance letter from the institution you are attending in Canada.

Do a thorough comparison of the various loan options provided by different banks, and then choose the right option.

After choosing the bank, the next step is to determine the amount of the loan and complete the credit application.

If your bank approves your loan request, it will issue a loan certificate. You should read the document carefully before signing it.

After the institution has agreed to all the terms, the company is then able to release the amount of the loan.

What are the expenses covered in an education loan?

When the bank has accepted your loan for education to study in Canada, it issues a loan agreement. Once you have signed your loan contract for Canada, the bank will pay the amount. The bank pays you either in instalments or lump sums, as agreed upon. In some cases, the bank will give the tuition fee to a specific Canadian university. After you have accepted your payment, you can use it for necessary expenses, such as books, tuition fees, laptops, lodging, and more.

Why should you study in Canada?

Can one get a student loan for diploma courses in Canada?

For programmes like MS in Canada, it is possible to access both secured and unsecured loans. When you need a loan for education in Canada to pay for a UG diploma, you can only get a secured loan.One of the main reasons is the absence of job opportunities in Canada following the completion of UG diploma courses. Banks want to put their money into a portfolio that guarantees a yield, so they choose bonds instead.However, it is not comparable to a PG Diploma education loan in Canada.Students have a hard time finding the study loan they need in Canada to obtain a PG diploma.

This is due to the fact that banks are not aware that educational loans are available to students to help pay for the cost of their PG Diploma within Canada. Furthermore, only Canadian colleges offer a PG diploma, and the programme is not recognised by the majority of Indian banks.

The Best Courses to Pursue in Canada

The eligibility criteria for a study loan in Canada

A loan for education in Canada for international students has certain conditions and requirements that must be met by the prospective applicants. A few of them are:

You must present acceptance letters from a reputable Canadian institution to be enrolled in an all-day program.

You must be over 18 years old. If the age of the applicant is less than 18 years, parents are required to submit an application for the education loan to Canada.

A high academic score is not a prerequisite, but it will certainly help you get the study loan you need for Canada.

The course you choose to apply for has to be career-oriented or have a good chance of advancing your career.

If you want to get a secured loan, you need to provide collateral in order to give them a study abroad loan in Canada.

  • Cost of studying in Canada
  • Documents required to get a Study Loan for Canada
  • There is a list of documents needed for a study loan in Canada, which includes the following:
  • Acceptance letter/proof of admission
  • Application for student loans
  • Photographs of passport size
  • Identity evidence (valid passport, voter ID, driver’s licence, Adhaar card)
  • Age evident
  • Academic transcripts and certifications
  • Exam scorecards (GMAT, GRE, TOEFL)
  • Permanent residence certificate for both the student and the guarantor
  • Bank statements from the last year
  • Guarantor’s evidence of income Examples: Salary slip
  • Other documents, if any, are optional.
  • Minority Caste Certificate
  • Extracurricular and Co-curricular Activities Certificates
  • Infirmity or Disability Certificate
  • Keep in mind that these are the most fundamental documents. Each bank will require a distinct set of documents to be used for loans to students in Canada.
  • The Grading System of Canada
  • The Top Loan Service Providers for Study Loans in Canada

There are a variety of banks (both public and not-for-profit) that offer loans for education in Canada from within India. A few of them include:

1. HDFC Credila Study Loan for Canada

This HDFC study loan for students in Canada provides the possibility of a 100% amount for tuition and fees. Additionally, it has a shorter turnaround time than a student loan available for international students who are studying in Canada and provides the flexibility of repayment choices as well. HDFC Credila study loans for Canada will cover the costs of international tests like IELTS and TOEFL, as well as SAT, TOEFL, GMAT, GRE, and many more. Depending on their academic program, Indian students can borrow up to 36 lakhs through HDFC Credila loans.

2. SBI Ed-Vantage Student Loan

The SBI Ed-Vantage Loan is another well-known student loan designed specifically for international education in various nations, including Canada. The study loan at Canada’s interest rates through SBI Ed-Vantage can be a minimum of 8 percent. It can cover 90 percent of total tuition and other expenses. SBI offers education loans of up to 1.5 crores to Indian students, with interest rates starting at 8.50 percent for students studying in India and 11.25 percent for students studying in Canada.

3. ICICI Study Abroad Education Loan

ICICI student loans for study abroad allow students to obtain loans to complete further education in Canada as well as aid with buying GIC. This includes the following: student loans, GIC, and savings accounts, as well as the university fee payment system. Additionally, it offers additional in-flight expenses, travel card services for forex, as well as outward transfers of funds. ICICI provides funds as high as Rs. 1 crore with the “iSMART” version to study around the world. Their interest rates start at 11.40 percent to 14.00 percent.

Repayment of Education Loans in Canada

You are able to repay your educational loan to Canada at any point during the course of your studies or after 6 months after the course has ended. If you are able to complete the repayment prior to the completion of your program, your bank will not be able to charge you any interest. After the grace period of six months, students are provided with a report from the government stating the rate of interest and the amount of repayment due. If the student takes out a credit line from CIBC, it will be transformed into personal loans following the completion of the program. Students have the option to extend their repayment term up to a maximum of twenty years.

The most lucrative jobs in Canada

Students typically decide to apply for education loans in Canada to finance their studies. These loans can be a fantastic source for many students who want to go abroad to pay for their education at a higher level and make their dreams of studying abroad a reality. Check out our blog on the cost of living expenses in Canada to find out more about the cost of living in Canada for students from abroad. For more details about Canadian universities, contact the Yocket Professionals and clear your doubts.

In Canada, the Most Commonly Asked Questions About Student Loans

Ques. Can international students get a loan for their education in Canada?

Ans. Yes. There are a variety of options for financing international students studying in Canada. Student loan debt is one of them.

Ques. What are the conditions for being a student loan applicant in Canada?

Ans. To be eligible for student loans, you must first obtain an acceptance letter from the Canadian university and start the application procedure. When applying for a student loan in Canada, you must provide identification, proof of age, and proof of financial status (in the case of secured loans).

Ques. Should you give an international student loan to students studying in Canada?

Ans. The main distinction between loans and other types of financial aid, such as scholarships and grants, is that grants and scholarships do not require repayment, whereas loans musts must. It is a fact that taking out a loan to finance your studies puts a heavy burden on you. This is why loans are the last option for funding your education.

Ques. Which bank is the best choice for Canada’s education loans? banks that do not have collateral?

Ans. Certain non-banking finance companies (NBFCs) and private banks offer collateral-free or unsecured education loans in Canada.These include Incred, Avanse, Auxilo, ICICI, etc.

Ques.: What are the student loan repayment conditions in Canada?

Ans. The terms of repayment for your student loan will be determined by the agreement between the loan provider and lender. Prior to granting the loan, the lender establishes the repayment schedule.

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