Are you deciding between HDFC Credila and Avanse for your overseas education loan? Beyond the interest rate, the differences in processing fees and GST can save or cost you over a lakh in upfront expenses. We’ve compared the fees from both lenders side-by-side to help you save on your application and visa costs. Check out the details below to see which loan fits your budget best.
Understanding Charges in an Abroad Education Loan
Let’s talk about the money you’ll need to have ready before you even get your loan.
- The Speed Factor: HDFC Credila is the go-to for speed. If your visa appointment is coming up fast, their quick approval process is worth considering.
- The Fee Trade-off: Credila usually takes a small percentage (around 1%) as a fee. However, Avanse might offer a flat rate for “A-list” schools, it’s worth asking both to see which saves you more.
- The GST “Hidden” Cost: Because GST is 18% of whatever the bank charges you, a high fee can lead to a big tax bill. This is cash you have to pay out-of-pocket, so factor that into your flight and deposit budget.
- Avoid Penalties: Lenders can be strict about dates. If you’re late with paperwork after the loan is approved, you might get hit with “late compliance” fees. Staying on top of your schedule is the best way to save.
Processing Fees in HDFC Creadila Overseas Education Loan
Unlike some public banks that offer flat fees, Credila’s charges are customised to the student’s profile:
- Processing Fees: Typically ranges from 5% to 1.25% of the sanctioned loan amount. For a ₹50 lakh loan, this means an upfront out-of-pocket expense of ₹25,000 to ₹62,500.
- Mandatory GST: An additional 18% GST is levied on the processing fee.
- Customised Pricing: Fees are not fixed; they fluctuate based on the country (e.g., US vs. UK), the university’s ranking, and whether you are providing collateral (property/FD).
- Non-Refundable Nature: Once a loan is sanctioned and the fee is paid, getting a refund is extremely difficult, even if you choose not to take the loan later.
Cost Structure of Avanse Abroad Education Loan
GST is a non-refundable tax that directly affects the cash flow planning of the middle, class.
- GST (18%):Both lenders are imposing a mandatory 18% GST on the processing fee.
For instance: A loan of 50 lakh with a fee of 1% (50, 000), you will have to pay an extra 9, 000 as GST.
- Administrative/Legal Fees: Avanse is introducing a fixed charge for legal and technical valuation (approx. 5, 0006, 000) besides 0.25% stamp duty on the sanctioned amount.
Credila, on the other hand, is bundling these with their processing fee, however, they may give you a separate invoice for property valuation if you are taking a secured loan.
Comparing Long-Term and Hidden Costs
An Overseas Education Loan might look like a fine offer, but because of the reworking fees, changes in the grace period, and extension charges, it can become very costly quite fast.
While comparing HDFC Creadila Overseas Education Loan vs. Avanse abroad education loan, students must consider:
- Sanction letters that show the charges clearly
- Flexibility in prepayment or part-payment
- Costs that come up when the length of a lesson is changed
- Help during visa delays or processing deferrals
Navigating education loans can be tricky, and without the right advice, it’s easy to get stuck with a plan that doesn’t fit your needs. Our loan managers help you structure a repayment schedule that respects your university’s specific dates and your graduation. Plus, they help you beat the Fall rush, making sure your financing is settled well before your visa interview so you can focus on your studies instead of your debt.
Making an Informed Decision
When comparing HDFC Credila and Avanse, the most important factor is not the brand name, but which lender offers the right features for your specific study abroad needs. Students who are planning to take out an Abroad Education Loan need to know about processing fees so they can keep their savings for living and settling down costs abroad.
A clear comparison allows students to move forward confidently, without unexpected financial stress.
Conclusion
To accurately compare education loans and avoid unexpected financial gaps, students must factor in processing fees from the start. Having a clear breakdown of these costs allows for precise budgeting of visa and admission expenses.
EduLoans simplifies international education by providing transparent advice and streamlined comparisons to accelerate your application process.
FAQs
Yes. Lenders often categorise universities and countries by “risk levels.” If you are admitted to a top-ranked university in a low-risk country (like the US, UK, or Canada), you may qualify for lower processing fees and better interest rates.
They are typically collected during or immediately after loan sanction.
Some flexibility may be available during peak admission seasons or through partners.
Yes, delays can sometimes lead to reprocessing or administrative charges.
Missing a university deadline can be more expensive than a slightly higher fee.