Cash woes? A personal loan to the rescue!

    CIMB Education Loan Review– One Loan for Covering Your Education Expenses

    Have big dreams? Great. But, as you would know it yourself, it’s not enough. You have to invest time and energy to first right-skill yourself for your dream job. But, it’s easier said than done, of course. To upskill yourself, in most cases, you’ll require a formal degree or diploma. If lack of funds is the only thing that’s pulling you from behind, an education loan from CIMB may be your ideal solution. While you remain busy taking care of your assignments, test scores, and job opportunities, the loan can cover your expenses, and give you and your family the much needed peace of mind.

    Convenient Interest Servicing Scheme, Attractive Interest Rate: Make the Most of This Loan

    Wondering if this loan can serve the purpose? A glimpse at the following benefits and features of this loan may help you determine the suitability of this loan:

    • High borrowing ceiling. With this loan, you can borrow up to 8 times your monthly income, subject to a maximum of S$200,000, to fund your education. Even if you haven’t been lucky enough to secure a full scholarship for your studies, there’s no reason why you can’t pursue your dream!
    • Low minimum borrowing amount. You can borrow as little as S$1,000 with this loan.
    • A range of loan tenure options. Flexibility of loan tenures often determine how customer-friendly a loan really is. With this loan, you can choose a tenure that lets you settle the loan in full within 1 year and up to 10 years.
    • Unlimited number of cashier’s orders. Get as many cashier’s orders as you need to maintain your cash flow and convenient loan disbursement.
    • One-for-all! A single education loan from this bank is enough to cover for a range of expenses that you’ll encounter through the entire duration of your course.
    • Low interest payments. Having to worry about grades and job can be exacting on your health. However, you can spare yourself additional worries with this student loan because you can easily manage your interest payments and charges.
    • No hidden fees. Enjoy a low processing fee of 2% of the loan amount. Rest assured knowing that the bank won’t pull unpleasant surprises on you by imposing hidden and arbitrary fees.
    • Convenient interest servicing repayment scheme. With this loan, you’ll enjoy the convenience of paying only the interest during the course of study. The principal and the remaining interest have to be paid after the completion of the course.

    Worried About High Interest Charges on Your Student Loan? Here’s What the Loan Will Cost You

    Under its interest repayment servicing scheme, you’ll have to pay a monthly interest only during the interest servicing period and a monthly instalment that includes both principal and interest charges, after it. The interest servicing period will depend on your course duration, borrowing amount, and total period of repayment. You may, however, also choose the standard-repayment option in which the monthly rest remains uniform throughout the entire duration of the loan.

    Depending on the prevailing processing fee of 2%, and the current monthly rest interest rate of 0.11% p.a., effective interest rate (EIR), and monthly instalment, on a loan amount of S$20,000, for 5 years, will be (standard repayment):

    Tenure EIR Instalment Amount
    1 year 9.18% p.a. S$1,716
    2 years 7.38% p.a. S$881
    3 years 6.75% p.a. S$603
    4 years 6.42% p.a. S$465
    5 years 6.23% p.a. S$382

    [Disclaimer: The figures displayed in this table are for illustrative purposes only and may differ from actual results.]

    Please note that for the interest repayment servicing scheme, the interest servicing period will be determined by the duration of the programme in cases where the period doesn’t exceed 4 years. The interest servicing period will always be rounded up to the next 6-month whole number. For example, if the period is 2 years and 3 months in your case, it will be considered to be 2 years and 6 months. Using the education loan calculator available on the bank’s website, you can calculate the monthly interest payable during the interest servicing period and the monthly instalment after the end of that period.

    Enjoy Substantial Savings on Loan Fees and Charges

    Are you wondering whether the various fees on this loan would reduce its affordability? While such fears may not be completely unwarranted, you may still enjoy significant savings with this loan. Here are the most important fees that you may have to deal with:

    Prepayment Fee 1% of the amount repaid early
    Cancellation Fee 1% of the undisbursed borrowing amount
    Processing Fee 2% of the loan amount granted, payable upfront
    Late Payment Charges S$80
    Fee for Cancellation/Amendment of a Cashier’s Order S$20

    Don’t Forget: You Can’t Apply for a Loan Amount Lower Than S$1,000

    Before you apply for this loan, take some time off to contemplate on the following points:

    • You can’t borrow any amount less than S$1,000.
    • You may not be allowed to apply for any amount that exceeds 8 times your monthly earnings or S$200,000, whichever is higher.
    • Foreigners are not eligible for this loan.
    • Interest will be calculated on a monthly rest case basis.
    • Partial prepayments aren’t allowed.
    • The loan amount approved or a part thereof will only be disbursed by the bank after it receives a notice of drawdown from you and an invoice from your school.
    • If you cancel an order for drawing after giving it to the bank, you’ll be responsible for all the costs borne by the bank including any real or notional losses that it may have faced.
    • In case you default on your payment, the bank will reserve the right to impose interest charges at its absolute discretion.

    Do You Satisfy the Eligibility Requirements?

    In order to be eligible for this education loan, you must:

    • Be a Singaporean citizen or permanent resident (PR).
    • Be aged between 16 years and 50 years.
    • Earn at least S$24,000 per year, if you’re the principal applicant (for individual applications).
    • Bring along a guarantor who earns at least S$24,000 per year, if applicable.

    A guarantor may be required in case of one of the following factors or a combination of the following factors:

    • You’re aged below 21 years.
    • The loan amount you have applied for, exceeds 8 times your monthly income.
    • You have applied for the Interest Servicing Scheme.
    • You’re about to take up a full-time course.
    • Your minimum monthly income is less than S$2,000.

    Ensure Smooth Application Processing by Furnishing the Mandatory Supporting Documents

    Here is a list of documents that you’ll have to submit along with your completed application:

    Common Documents:

    • Provide a copy of NRIC for both the applicant (you) and the guarantor.
    • Wherever applicable, establish proof of relationship between the principal applicant and the guarantor for the loan.
    • The completed application must bear the signatures of the guarantor and the principal applicant.
    • Provide a letter of acceptance from the institute where you plan to pursue your education. The letter should mention the type of course, the duration of the programme, and the total course fee that you’ll have to pay.

    In addition, you’ll also provide the following income documents (where applicable) depending on your employment category:

    Salaried Employees
    Commission-Based/Variable Earning Employees
    Computerised payslip for the last 3 months OR A statement of CPF contribution history for the last 1 year OR The latest Notice of Assessment (NOA) received from the Income Tax Department.
    Income Tax NOA for the last 2 years.
    Salary/commission computerised statements for the last 2 years OR Income Tax NOA for the last 2 years.

    Ready to Submit Your Application? Here’s What You Can Do

    In order to apply, use any of the following channels:

    • Submit your application online.
    • Fill in the contact form and wait for the bank to get in touch with you.
    • Visit a CIMB branch closest to you.
    • Send an email to the bank and receive a response within 1 business day.
    • Call the bank for more information and guidance from Monday to Sunday between 9:00 a.m. and 9:00 p.m.

    What Else Should You Know? Delve into This Section for Commonly Asked Questions

    Q. What are the monthly-rest rates under the Standard Repayment scheme and the Interest Servicing scheme?

    A. Under the Standard Repayment scheme, a monthly rest of 0.11% p.a., depending on CIMB’s prevailing prime lending rate (currently at 5.5% p.a.), would apply for the entire duration of the loan. The monthly rest currently for this scheme is 5.5% p.a. - 0.11% p.a.

    For the Interest Servicing scheme, however, a rate equal to the sum of the prevailing CIMB’s prime lending rate and 0.49% p.a. would apply during the interest servicing period (the first 4 years) and the difference between the prime lending rate of the bank and 0.11% p.a. would apply thereafter.

    In other words, the monthly rest interest for the first 4 years of the course duration will be 5.5% p.a. + 0.49% p.a. and post this period, it will be, 5.5% p.a. - 0.11% p.a.

    Q. Will the bank reimburse me from the credit facility (education loan) for the tuition fees that I have already paid?

    A. No. This loan may not be used to reimburse tuition fees and related charges, once settled.

    Q. What is the monthly-rest basis for interest computation?

    A. Under this method, the outstanding balance on the loan from the previous month, is used to calculate the loan interest and the monthly instalment.

    Q. Do I have to give the bank a formal notice for early redemption of the loan?

    A. Yes. You may prepay the loan by giving the bank a formal, written notice at least 1 month before the date of prepayment. Don’t forget to mention the date in your letter.

    Q. Is there a time limit within which I must notify the bank of any error I find in the statement?

    A. Yes. If you spot any errors in the statement issued by the bank, you must inform them within 14 days from the date of statement generation. Otherwise, you may have to forfeit your claim for a grievance redressal.

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