Can a friend become guarantor for education loan?

This impacts both the guarantor’s and student’s CIBIL score. You can be a guarantor in an education loan to help your friend or family to meet the loan eligibility. This means the non-payment of the student loan can lower your CIBIL score whether you are the original borrower or not.

Can a friend be a guarantor for a loan?

And all that is required is for you to sign on the dotted line in a loan application form. Signing up as a guarantor is a huge responsibility and is best avoided unless the loan is taken by your spouse, a close family member or a friend whose financial credentials and repayment capacity you are absolutely sure of.

Who can be your guarantor for education loan?

As most students have no previous credit history, the parent or guardian has to co-sign for an education loan as a guarantor. Moreover, education loans also require key lender approved collateral such as property documents, fixed deposits, etc.

Can a friend be my co applicant for education loan?

The financial co-applicant can be anyone who is related to the loan applicants by blood. Students are also allowed to name a third-party as their financial co-applicant, just in case if they do not have any relatives.

Can a sibling be a guarantor?

Who can be a guarantor? Guarantors are typically parents wanting to help their kids get a foothold in the property market. As well as a parent, a guarantor can also be a parent-in-law or a step parent and grandparents, siblings, spouses and de facto partners will also be considered by many lenders.

What are the risks of being a loan guarantor?

Know the risks of going guarantor

• You may have to pay back the entire debt.
• It could stop you getting a loan.
• You could get a bad credit report.
• It could damage your relationship.
• Loan amount.
• Loan security.
• Loan term.
• Business loans.

Does education loan require collateral?

Collateral Required for Education Loan Guidelines show that loan taken up to Rs. 4 lakhs does not require collateral security. It is only when the loan exceeds a specified amount as set by the bank that collateral will be required as well as third-party guarantee.