Guide To Taking Up Education Loan In Singapore

Education loan Singapore is a serious financial commitment you should consider if you are planning to further your higher education studies in Singapore. This unsecured loan helps you continue your studies with more ease in mind and lesser worries about financial stress, because it helps with upfront payment for your education. Unless you can qualify for the governmental loans of CPF Education Scheme or MOE Tuition Loan (read more - https://www.moe.gov.sg/financial-matters/government-loan-schemes/study-loan), chances are that the education loan is a necessity.

There are a few factors in play when getting an education loan in Singapore. Before we delve deeper into the factors, let us look at the education loan avenues in Singapore.

Banks are financial institutions that disburse various education loans. Among the banks that offer the loans, DBS and OCBC are some of the popular choices of interests. If you take up $20,000 in education loan as principal loan amount, you can pay 4.5% interest rate per annum for 5 years. To ensure you qualify for the loan, you must hit a minimum age of 21, or else you need your parent to be the guarantor.

Interest rates, repayment terms, loan tenure and late charges are also important factors of the education loan from the banks. They are all in accordance with the Monetary Authority of Singapore for education lending purposes.

The banks are not the only avenues of education loans. Licensed moneylenders are another viable approach in Singapore. They are better than banks as they are faster and more convenient with a hassle minimality in approval process. Swift and easy, the education loans from licensed moneylenders are often borrowed by people in Singapore.

However, borrowing from licensed moneylenders for education loans is better to be properly understood. 2 types of education loan in Singapore apply - monthly repayment and interest only loans.

For the monthly repayment type, you must make repayments on the education loan every month to service. This includes the interest rates and other fees. For the interest only, you only need to make payments on the education loan after your studies end. Should you do not graduate, this may not be worth taking.

When taking up education loan in Singapore, please ensure the ability to make repayments. Yes, you will be met with many challenges such as failing the exams or financial inadequacies. You may not be able to repay the licensed moneylender on time. But then your guarantor may face legal actions from the moneylender even through court actions. They will chase for payment from them.

It is extremely advisable that you utilise the education loan wisely upon approval and disbursement. You must not only use it to finance your daily living and accommodation expenses. You should ensure you can graduate out of the study program happily with good results so you can secure a job in future with the paper qualifications and make repayments on the education loan. Singapore is costly to live in, so do make use of the education loan properly.