Can I take an education loan on floating rates? For a two-year course with course fees of about Rs 20 lakh, what would be the advantage of taking a floating loan, irrespective of which bank I get it from?
Anshul Chaturvedi, Delhi
The difference between floating rate education loans and fixed rate ones is less than 1 per cent per annum. Thus, unless you are sure about paying off the loan very quickly after finishing your course, it might be advantageous for you to plump for the relative safety of the fixed interest rate, especially since interest rates are widely expected to have already bottomed out and are likely to rise over the next few quarters. In any case, this is not a one-time decision; you need to continuously review it based on the changes in the marketplace, and switch from your choice to others, if the markets move against your choice.
