Educational
loans include commercial educational loans and state
educational loans with fiscal interest discounts. Commercial
educational loans refer to consumer loans granted by the
lender to borrowers to finance the tuition and miscellaneous
fees (including the traveling expenses for going abroad) of
the borrowers or the persons under their legal guardianship
in studying at domestic secondary schools or ordinary higher
learning institutes or for master's or doctor's degree, or
studying at universities or for master's or doctor's degree
outside the territory with approval. State educational loans
refer to educational loans granted by the lender to
borrowers that are given fiscal interest discounts by the
central financial authorities or local financial sector, and
are used for the tuition and miscellaneous fees, lodging and
living expenses of the borrowers in studying at domestic
higher learning institutes for full-time undergraduate,
professional or graduate courses.
State
educational loans belong to credit loans and enjoy a 50%
fiscal interest discount, and their applicants must meet the
condition that the involved schools have access to state
educational loans. Loans for studyingd abroad are currently
limited to commercial loans.
Commercial
Educational Loans
Prospective
Borrowers
1. Natural
persons with full capacity for civil conduct;
2. Having
permanent residence or valid residence permit, and holder's
own passport or border pass if studying at a college abroad;
3. Having
the enrollment notification or letter of offer from the
school for study, student's identity card, and having the
materials of certification on necessary tuition and
miscellaneous fees during the period of study provided by
the school for study;
4. Providing
asset mortgage or pledge that is accepted by the lender or a
guarantee provided by a third party guarantor that has the
capacity of repayment by subrogation and also holds joint
and several liability;
5. The
borrower already has a certain proportion of the money
needed by the educated persons.
Length
of Maturity
•
The length of maturity of an educational loan is
usually one to six years, with the longest not exceeding ten
years inclusive. The specific length of maturity depends on
the study conditions of the borrower and the nature of
guarantee.
Lending
Rate
•
The interest rate for loans of the same grade stipulated by
the People's Bank of China applies to the lending rate for
educational loans. If the length of maturity is one year or
shorter, interest shall be computed in accordance with the
contracted interest rate, and the contracted interest rate
shall remain unchanged in case of adjustment of the legal
interest rate; if the length of maturity is over one year,
in case of adjustment of the legal interest rate, the
interest rate shall be subject to the adjustment by the
People's Bank of China.
Lending
Currency
•
Renminbi.
Borrowing
Limit
•
The ceiling of an educational loan shall in principle not
exceed 80% of the total amount of tuition and miscellaneous
fees.
Loan
Guarantee
There
are three loan guarantee modes, namely, mortgage, pledge and
guarantee.
1. If
a loan is applied by mortgaging a house or other real
estate, the rate of mortgage is 70% of the evaluated value,
but the loan may not exceed 80% of the total amount of
tuition and miscellaneous fees.
2. If
a loan is applied by pledging certificates of deposit or
registered treasury bonds, the rate of pledge for
certificates of deposit or registered treasury bonds is 90%,
and for certificates of deposit issued by other banks or
other pledged security, the rate of pledge depends on the
value of the pledge security, but the loan may not exceed
80% of the total amount of tuition and miscellaneous fees.
3. If
a loan is applied in the mode of third party guarantee, the
ceiling of borrowing may not exceed 70% of the total amount
of tuition and miscellaneous fees. But it may be raised to
80% in case of joint and several liability guarantee
provided by a bank or an insurance company.
Loan
Application
In
applying for an educational loan, the borrower shall file a
written borrowing application to the lender, fill in related
application forms and also present the following documents
and certification materials:
1. I.D.
cards of the borrower, the original of valid residence
certificates, , or the original of passport or pass of the
educated person and its duplicate for file keeping in case
of studying abroad;
2. Enrollment
Notification of the school for study or student's identity
card, and materials of certification drawn by the school for
study on the total amount of tuition and miscellaneous fees
needed by the educated persons during the period of study;
3. If
property is used for mortgage or pledge, necessary id
provision of a detailed list of the mortgaged or pledged
property and the commitment or statement agreeing to the
mortgage or pledge by the person entitled to the disposal
(including co-owner of property) with his/her signature
thereon. For mortgaged property, an evaluation report issued
by the competent department and the insurance document
issued by the insurance company shall be provided, and for
pledged property, a document of ownership or entitlement
certification shall be provided. If a guarantee is provided
by a third party, a written document of the guarantor
agreeing to guarantee and the related credit certification
materials shall be provided;
State
Educational Loans
Borrowing
Conditions
1. Having
full capacity for civil conduct (for a minor, a written
letter of consent provided by his or her legal guardian is
necessary);
2. Having
a valid residence permit;
3. Reaching
the study and conduct criteria required by the lender,
without any act of bad credit;
4. The
school for study has signed a bank-school cooperation
agreement with the Bank of China;
5. With
recommendation by an reference and also with a witness to
provide a written certificate of his or her identity;
6. Agreeing
that if the loan is overdue for one year and an extension is
not approved, the lender is to make public his or her name,
the number of his or her I.D. card and the act of default at
the higher learning institute where he or she studies or on
related media.
Length
of Maturity
•
The length of maturity of a state educational loan usually
does not generally exceed eight years. If a student granted
the loan further studies for a graduate or a second
bachelor's degree after the undergraduate course ends, the
length of maturity during the period of study is extended
accordingly, and the principal and interest of the loan
shall be repaid up within four years after graduation from
the graduate or the second bachelor's degree.
Lending
Rate
•
The interest rate for loans of the same grade
stipulated by the People's Bank of China applies to the
lending rate for state educational loans.
Borrowing
Limit
•
The amount of a state educational loan shall in principle
not exceed RMB6000 per person for one year.
Loan
Application
In
applying for a state educational loan, the borrower shall
file a written borrowing application to the lender, fill in
related application forms and also present the following
documents, certificates and materials:
1. Original
and duplicate valid personal certificates of residence
permit and identity;
2. Enrollment
Notification of the school for study and its duplicate, or
student's identity card and its duplicate;
3. Certificate
of tuition and miscellaneous fees and living expenses of the
student during the period of study drawn by the school for
study;
4. Letter
of recommendation and a certificate agreeing to the
borrower's access to 50% interest discount of state
educational loan drawn by the school for study.