5 Problems You May Face During Education Loan Disbursement

"Your application for an education loan has been approved and your loan has been sanctioned,"

a statement that fills the eyes of overseas study aspirants with cheerfulness and serves as a reason for relief. However, the majority of students are unaware that their higher education journey is still just halfway over. Getting an education loan is comparable to making a MasterChef recipe. Everything needs to be put in perfect quantity to complete the procedure. 

The process of getting an education loan sanctioned by a student on their own is a tough task. On top of that, the post-sanction loan disbursement issues make it even more challenging.

In this article, you will find the various disbursement problems of the education loans that students face, also, we will tell you the solutions to deal with those issues so that you can avoid the bumps in your journey of getting the best education loan for yourself.

What is Disbursement in an education loan?

Disbursement in an education loan refers to the transfer, or release of the loan amount from the lender to the university, or the student’s account to cover the educational expenses, according to the loan agreement.

You can get a complete or partial disbursement depending on your lender and the loan agreement. It is the final step in the education loan process.

Issues in the Disbursement of an Education Loan

Here are the 5 common disbursement issues that you could face during your education loan process.

1. Pre-visa Disbursement issues

   Countries such as Germany, Australia, Canada, and New Zealand require a disbursement of funds from the loan to pay the tuition fees, or living expenses, before the visa application process. This is called a pre-visa disbursement. 

   Many lenders refuse to disburse the funds before visa approval. This is because not every official at every bank is aware of the pre-visa disbursement requirements and policies. But without a pre-visa disbursement of funds, you cannot secure a visa for these countries.

2. Untimely, or delayed Disbursement

   Your dream of pursuing higher studies in a foreign land can become a nightmare if you are left out of funds and cannot even ask for help from your friends or family. Imagine yourself in such a situation when you have to pay your tuition fees within a week and manage your everyday living expenses abroad. But your lender, even after promising you a disbursement on a particular date, doesn't fulfill their commitment on time.

   This is true, as we have heard from many students who have taken loans from anonymous lenders and later had to face issues due to untimely disbursement of the loan amount.

3. Unresponsive Lenders

   An education loan sanction letter is an assurance for students that now they will get a disbursement whenever they need it. But little do they know, the lenders will not respond to their calls or emails as quickly as they used to before loan sanction.

   Because of this, the disbursement of loans gets delayed. As a result, many students miss their university's tuition fee payment deadline. Think of a moment when you are stranded abroad,  your survival is at stake, and your lender is not responding to your calls, this is certainly the worst nightmare for any student studying abroad. 

4. Issues in third-party wire transfers

   Most universities generally do not accept payment of tuition fees directly from student accounts. Instead, they partner with third-party mediators, like Flywire, who receive tuition fees and other university expenses from students and accept them on the university's behalf. (and then transfer the funds to the university's account as a whole). That is why students can not afford to get their disbursement delayed.

   Often, lenders delay or refuse to disburse tuition fees through third parties due to reluctance. As a result, students can face late payment penalties, cancellation of admission, or visa application issues. 

5. Reimbursement issues

• • Most students pay the university application fees or seat booking tokens out of their own pockets when applying for an education loan. They do not know that the amount they have given to the universities can be reimbursed.
  • Also, if the student has incurred any expenses that would otherwise have been covered by their education loan, the student can get a complete reimbursement for those expenses as well.
  • Students just have to provide proof of expenses and inform the lenders about the reimbursement.
  • Yet, oftentimes the lenders do not reimburse the entire amount and the students have to settle with no reimbursement, or a lesser reimbursement amount.

How WeMakeScholars Can Help

By now you must have a detailed idea that getting an education loan sanctioned from a lender is just not enough, to celebrate your study abroad plans. You still have to go through a lot of hurdles without letting them affect your studies.

This is where WeMakeScholars comes into the picture as your saviour. We are partnered with more than 15 public and private lenders. When you take an education loan through us, you will be assigned a dedicated Financial Officer, who will take care of your entire loan process. They will make sure to help you not to come across such issues and even if you do, your financial officer will contact the bank on your behalf to resolve your issue in no time. 

So what if you face any issues while abroad? You don’t have to worry and bother your family or friends to contact or visit the branch in such a case. Your financial officer can get it resolved as they are already handling your application. We also have a dedicated post-sanction team to resolve all your issues till your repayment ends. To solve any disbursement issues you face, get in touch with our experienced Financial Officers by requesting a callback now.  

Conclusion

This article contains key information about various issues one can face in the disbursement process of an education loan and how to resolve them. This information can help you avoid such issues and make the right choices when you are planning for an education loan to pursue your higher education.

We here at WeMakeScholars have only one goal: to make your dream of studying abroad come true by providing you with the best education loan support in terms of rate of interest and other loan terms & conditions by analyzing your profile in detail. So that you can excel in your career. We are here to help! Simply Request a Callback on our website, and one of our expert loan officers will get to you at the earliest.

If you are interested in learning more about studying abroad and student life abroad, then I highly recommend you to read:

• Effect of Repo Rate on Education Loan Interest Rate
• Interest Rate, Loan Sanction & Disbursement Issues with Solutions
• 15 scholarships for Indian Students planning to study in the UK
• 7 tips to save money while studying abroad in recession time