Co-applicant requirements for self-employed individuals:
Self-employed individuals are interpreted by banks as persons who are sole proprietors, partners, or directors in business, manufacturing or trading activities. Professional like doctors, chartered accountants, engineers, consultants, architects, company secretaries and MBA's who have their own business entities also fall into this category.
The age of the self-employed co-applicant must be greater than 21 years and his maximum age at the time of loan maturity should not be more than 65 years. In addition to this the banks ask for proofs of the continuity of business. To establish the fact that the business is in good standing they enforce total business experience criteria and minimum time in current business clause. Banks also put a minimum income clause which requires the co-applicant to have at least an annual income ranging between Rs. 65.000 to Rs. 100,000.
The self-employed co-applicant will be asked to provide documents verifying his identity, residence proof, bank statements, and income tax returns as the proof of his income. In addition to it if the co-applicant is a self-employed professional like CA or doctor, he will also have to furnish documents regarding his qualifications.
Co-applicant is an essential requirement for education loans and care should be taken that before you apply for such a loan, you qualify properly as a co-applicant. Also, one should ensure that the collateral requirements are met adequately. This will help tremendously in making the education loan a quick and hassle free process.