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July 22, 2023
To understand the moratorium period in education loans, we must understand the term moratorium. It means simply a break by an official agreement .so the moratorium period in an education loan is the period before the borrower starts repayment. During this period borrower is not charged the EMI but interest is being charged and it is being compiled year on year, usually, it lasts until one year after the completion of your studies. However, many private banks and NBFCs charge partial interest from the borrower during this period.
Students can make the best use of this period by paying EMI’s in advance so that they are not burdened by them later on it is best to finish the loan before the completion of tenure as an education loan has no closure charges i.e. If the loan tenure of borrower was10 years and he completed his payment in 8 years the borrower would not be charged an interest of remaining two years by the lender and neither will the borrower have to pay anything extra amount, to close the loan
