Education Financing Options to Study in Germany
There has been an increased interest to study abroad, especially in Germany, in Indian students, and this does not come as a surprise at all. The world-class education facilities in Germany are indeed remarkable and quite worth the hype and drool. The quality of education delivered by professionals as well as the impeccable research environment created in the education sector has been attracting education enthusiasts from all over the world to take admissions in German universities, especially for their Masters. Minimal education fees and great placements add to the pros of studying in Germany and have simply continued to spike interest in more and more international students. Indians too have been attentive to these benefits and interestingly are the 3rd largest group in the world to prefer Germany for their higher education.
What is the cost of studying in Germany?
The first question to hit you, when you think of studying in Germany is the cost that your pocket will have to bear, which can be a very daunting thought. Well, on the upside, most universities in Germany are state-funded and thus charge a minimal/affordable tuition fee. Additionally, most international students interested in studying in Germany usually find suitable scholarships to fund their education abroad. The State provides plenty of them for various courses. However, it is difficult to get scholarships for private universities which also charge comparatively higher tuition fees. This fee varies from institution to institution, primarily depending upon the services and facilities provided. Listed below are the 4 most esteemed German universities and their respective tuition fees. Have a look to gain an estimate of your probable average expenditure.
The Technical University of Munich:
The Technical University of Munich is estimated to charge an average of 258 Euros/Year from international students as the fees.
Ludwig Maximilian University of Munich (LMU):
Interestingly the Ludwig Maximilian University of Munich charges a nominal semester fee of 258 Euros from international students, besides which they do not charge any tuition fee for most courses. However, they do have tuition fees for a few English-taught specialization courses so it is imperative to glance through the details of your respective course carefully.
Heidelberg University:
The Heidelberg University is estimated to charge an amount of 1,500 Euros per semester from non-European students as their semester tuition fee for any bachelor’s as well as Master’s program.
The Humboldt University of Berlin:
The Humboldt University of Berlin does not have any tuition fee, however, it charges an estimated semester fee of 300 Euros from international students which is also inclusive of their public transportation in Berlin.
Accommodation charge is another important aspect that needs to be taken into consideration while estimating the expenditure of studying abroad. Even though it is not very costly to survive in Germany, a student must keep aside a minimum of 10,300 Euros to secure the costs of living in Germany.
Having noted the above-mentioned estimates of the semester and living charges in Germany, despite the minimal cost, it can still be taxing and difficult for some students to meet these financial requirements. In such cases, education loans can help you bring your dream of studying abroad to reality. They are student-friendly, easily accessible, and simply exist to overthrow financial burdens that create hurdles between students and their dreams.
What are the types of education loans that can be availed to study in Germany?
There are two types of education loans available in the market for students interested in studying abroad. Namely – Secured Education Loans and Unsecured Education Loans both of which are explained in brief, below.
Secured Education loan to study in Germany:
Secured Education Loans demand collateral for security. In such cases, students must attach collateral (which can be an asset, for example – property, mutual funds, FDs, etc) along with the loan application which is then introspected by the bank and may be used by the bank to retrieve the loan in case the student fails to repay the loan in future.
Unsecured Education Loan to study in Germany:
Unsecured Education loans are simply loans without any collateral/security. The student need not attach any collateral while applying for the loan. Since there isn’t any asset kept in security, most banks do not sanction unsecured loans of more amounts than INR 7.5 L. For amounts more than that, private banks/NBFCs can be approached.
Some other aspects such as the period of loan processing, the expenses included in the loan, the repayment period, etc. are crucial and vary from institution to institution. Find details about the same, below –
- The loan processing time: NBFCs take the least time to process loans and usually sanction them within a short period of 4-5 days. Unsecured loans, on the other hand, require 7-10 working days to be sanctioned by a private bank while secured loans take much longer to be sanctioned/processed because of the involvement of collateral; it is only after the introspection and verification of the pledged collateral that a secured loan is sanctioned.
- Expenses included: NBFCs and some public sector banks cover 100% of student’s education-related expenses. Some public banks and most private banks cover only 90% of the student’s education-related expenses. A student must chart out the possible expenses and produce the list before the lenders to get the required remuneration.
- Co-applicant’s income details: Secured loans do not require the co-applicant’s income details. However, it is to be produced mandatorily for the sanctioning of unsecured education loans. The requirement varies between lenders.
- Repayment process: The repayment process and period vary between institutions and lenders. Most public banks offer a repayment period of 10-15 years, wherein the student is required to begin paying his/her EMIs after 6 months of course completion. Private banks offer a comparatively shorter repayment period wherein the student is required to begin his/her EMIs after a year of course completion. Similarly, NBFCs offer a further short repayment period and require a student to begin paying his/her EMIs soon after the sanctioning of his/her education loan.
- Common reasons for loan declination: There are innumerable reasons that can factor in loan refusal, some of which can be poor CIBIL score, incomplete documentation, low co-applicant’s income, etc. However, proper counseling and support can help you increase the probability of loan approval.
Listed below are the most common documents that are required for a secured/unsecured education loan to study in Germany
- Proof of citizenship and residence of the applicant as well as the co-applicant
- Student’s education mark sheets
- Letter of Admission from the university in Germany
- Co-applicant’s bank statement as well as income tax returns for unsecured education loan
- Documents related to the pledged collateral for secured education loan
- Details of the student’s education fee structure
- Applicant and co-applicant’s customer document
Note – The above-mentioned documents are the most commonly asked. Document requirement, however, differs from lenders to lenders.
How to secure an education loan to study in Germany?
Directly applying to a loan sanctioning institution can be tempting but is a tiresome and lengthy process. You are most likely to feel clueless and lost during the entire loan sanctioning process. It is advised to approach a marketplace like GyanDhan. They have partnerships with top government banks such as SBI and BOB, private-sector banks such as Axis and ICICI, and several NBFCs. What’s more! Their education loan assistance service is totally free of cost. For both secured and unsecured abroad education loans to study in Germany, you can get in touch with them.
