 "How your education loan affects your credit score")
While an education loan today has almost a necessity, given the high cost of education, don't let the loan overburden you.
Good way to build credit history
An education loan is a good way of building good credit history. Usually, it is the first loan that the student is availing and, hence, most of them do not have any credit history of their own. However, by repaying on time, students can build their credit history for the future loans that they may avail, such as automobile, home, credit cards etc.
Can open the way for other loans
Impact of delayed repayment
In case of default or delayed repayment, not just the student's, but the co-borrower's (parent/guardian or third-party) credit history and record also will be impacted negatively. So, be regular with your repayment. And in case of larger loans, where banks take collateral, such as property, the bank can attach the property to recover its dues.
Good way to build credit history
An education loan is a good way of building good credit history. Usually, it is the first loan that the student is availing and, hence, most of them do not have any credit history of their own. However, by repaying on time, students can build their credit history for the future loans that they may avail, such as automobile, home, credit cards etc.
Can open the way for other loans
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Those who are regular with their education loan repayment can get pre-approved loans for other requirements based on impressive credit scores from the same bank.
Impact of delayed repayment
In case of default or delayed repayment, not just the student's, but the co-borrower's (parent/guardian or third-party) credit history and record also will be impacted negatively. So, be regular with your repayment. And in case of larger loans, where banks take collateral, such as property, the bank can attach the property to recover its dues.