HDFC Credila's unique education loan offers the flexibility of paying only simple interest (PEMI) during the course period and principle plus interest (EMI) after the completion of studies and grace period.
The repayment periods are generally driven by our evaluation of the student's potential earning capability and risks we perceive in extending any particular loan.
At HDFC Credila, we understand that students want to start repaying loans immediately after they get a job. However, they may find higher EMI's (due to shorter repayment periods) at the start of their careers, very challenging. Thus we offer longer tenure to facilitate smooth transition of student from campus to corporate. This way they can start their earning and professional lives with positive credit histories that help them to take other loans in future.
Interest may be calculated on daily, monthly or yearly reducing principle basis
Education loans are structured with either complete moratorium during the course or only principle moratorium. Usually, 6 months to 1 year of grace period is also extended after the course for the student to search for a job
Yes, based on the genuine reasons it can be. We can review this on a case to case basis.
He/she will have either close the loan by paying full amount or keep repaying monthly installments on time to avoid becoming a defaulter and ruin their own credit history
It's for the benefit of students and parents. HDFC Credila offers simple interest rates. Compounding of interest adds financial burden and unnecessarily parents and students have to bear a large burden of interest on interest. HDFC Credila thinks that it's helpful for the students not to pay interest on interest. Therefore, HDFC Credila products require at least the interest payment on the loan during the study period.
HDFC Credila charges simple interest rate. HDFC Credila also believes that this reduces the burden on students and parents. It's very important to set in financial discipline for the students. HDFC Credila has noticed that once interest on interest is avoided, students and parents feel quite comfortable dealing with the EMIs of the loan. It helps students also since there are many other expenses to take care of after the student gets the first job.
Yes. There is an option available for upfront interest also depending upon the course and underlying demographics of the student.
HDFC Credila allows students and parents to make part payments or foreclosures on the education loans. HDFC Credila's funds come in from various sources such as Commercial Paper or Term Loans etc. Depending on the conditions of these sources, decisions about the pre-payment charges etc. is taken depending on the type of the loan product and the time when the loan is pre-paid. If someone takes the loan just to get some short term objective, then HDFC Credila discourages that by charging some pre-payment charges in such cases. HDFC Credila is compliant with all NBFC related guidelines.
Yes, normally the pricing is designed to encourage at least simple interest repayment during the course period. This helps the students/parents:
The simple interest repayment, which is a relatively smaller amount per month, starts immediately. And post the course and grace period (time given by lenders to student for searching a job after course), the regular repayment starts in the form of equated monthly instalments (EMIs).