Wondering why your education loan got rejected?
It gets really disheartening when you face loan rejection while pursuing your study abroad dream. After fulfilling so many difficult requirements of overseas admission, loan rejection can lead to a complete turnaround. Your study visa approval greatly depends on your ability to produce a solvency letter. In such a situation, loan rejection can complicate things further. Not being able to present the proof of funds can lead to the rejection of a visa application.
What can lead to loan application rejection?
There can be more than one reason!
Discrepancies in the application are not the only reason for loan rejection. There are other factors too that decide the fate of your loan request. Read on to know the most common reasons for loan rejection.
Weak Academic Background
Your academic record matters!
A poor academic record can lead to loan application rejection. Financial institutions prefer to lend education loans to students with a good academic record. Therefore students with backlogs and academic gaps stand fewer chances of procuring the loan. Average academic performance in the past is taken as a sign of less student employability. Considering such lendings as high-risk loans, banks may decline your study abroad loan request.
Admission to an Unrecognized University or College
The choice of the education institution also makes a difference in the approval or rejection of your study abroad loan. The QS ranking of the academic institution you want to study is one of the deciding factors for education loan approval. If the overseas university or college is not listed with the lender, the odds of getting an education loan are quite low. You must apply to a recognized university or college to get an education loan without rejection.
Choice of Course
The choice of the program plays an important role in getting an educational loan. Banks easily approve STEM (Science, technology, engineering and mathematics) courses because there are high chances of getting lucrative employment after completing these programs. It isn’t easy to procure loans for medicine, arts, and commerce programs. So, the choice of the program can lead to the rejection of your loan application if the financial institution finds it a risky investment.
Poor CIBIL Score
A poor CIBIL score is a result of poor credit history. Your credit history is one of the most important factors the financial institution considers before lending you an education loan. Moreover, positive credit history is an indicator that the applicant is capable of repaying the loan. The guarantor’s credit history is also a deciding factor while approving education loans.
When procuring an education loan, numerous documents must be submitted to the bank. The chances of an education loan getting denied are quite high if you have not filed the required documents correctly. Financial institutions reject such applications where the documents submitted are not genuine.
Absence of letter of acceptance
If you have not received a letter of acceptance from the university, it decreases your chance of getting an education loan. An admission letter or acceptance letter from your university is needed before applying for an education loan.
Choice of Country
Loan lenders give countries with renowned education systems and high employment potential more weightage. If you have chosen a country that is not very popular for its quality of education, it can be hard to procure an education loan. Even after getting accepted by the university, you may face loan rejection because banks maintain a list of countries and programs for which they are ready to provide a loan.
Is there a solution to tackle all these aspects?
Undoubtedly, Yes. There is a solution!
ForeignAdmits can help you with thorough guidance and real-time assistance while applying for an education loan. You can get a 0.25% lower interest rate on the loan even if you already have your loan approved. We make the complex loan procurement process easy by offering the following tools-
- Loan Finder- Our loan finder tool helps you connect with our banking partners who offer education loans at reasonable interest rates. The decision lies with you! We help you connect!
- Loan Eligibility– This tool can help you know your chances of getting the loan!
We allow you to track your application status and know real-time progress. We focus on building long-lasting relations and meeting your overseas requirements most pertinently by maintaining complete transparency. Sign up now at ForeignAdmits to avail our exclusive post-admission services.