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Foreign Exchange Loan for Studying Abroad

Name

Foreign Exchange Loan for Studying Abroad

Introduction

I. Purpose

The borrower can only use the loan for the tuition fees, living expenses for studying abroad with approval in foreign middle schools or universities, and pursuing master's degree or doctor's degree, or for obtaining relevant credit certification.

II. Term

Terms of the loan shall be one to six years, ten years at most (including ten years) according to the actual study and guarantee nature of the borrower.

III. Loan Currency： USD (more currency types will be applied at the appropriate time)

IV. Maximum Limit of Loan

In principle, the maximum limit of loan is not allowed to be over 90% of the total amount of the tuition fees and living expenses of students and accompanying persons.

V. Interest Rate

Loan interest rate is set according to foreign exchange loan interest rate (floating).

VI. Guarantee

The loan can be guaranteed by mortgage, pledge, third party guarantee, insurance and many other means.

VII. Loan Issuing

The loan can be transferred directly to the accounts of overseas branches of Bank of China, and to the schools or university (college) (for tuition fees) and the student borrower (for living expenses) seperately on customers' demands.

VIII. Repayment Method

In China, repayment may be entrusted to any other person; in other country, repayment may adopt remittance.

IX. Grace Period of Repayment

The lender may give a certain grace period to the borrower, which is limited to period when the student borrower studies in school or university (college) and during which only the interest rather than principal is paid; the educated person shall renew repayment schedule with the lender, i.e. repayment of principal with interest on monthly basis since the second month after the educated person receives graduation certificate. The grace period is 4 years at most.

Target Customers

All Chinese citizens with full civil capacity and permanent residence in China can apply to Bank of China for foreign exchange loan for studying abroad. And customers may choose students themselves or their parents or statutory custodians as borrowers according to their needs. As for the actual funds user less than 18 years old, their statutory custodians may act as borrowers.

Required Documents

1. ID card, Hukou book or other originals of other valid residence certificates of the borrower or all parties involved, and valid identity documents of the educated person as well as copies of all proof certification above;

2. Proofs of permanent job and regular income of the borrowers or their family members approved by the lender;

3. Admission letter or enrollment letter issued by the schools or universities (colleges) of the educated person and relevant documents on total amount of necessary tuition fees and living expenses (or relevant proof documents provided by cooperative intermediate institutions) during the study of the students in schools or universities (colleges);

4. As for mortgage (pledge) with assets, valid proofs of mortgage (pledge) objects and statement of commitment and declaration on consent of mortgage (pledge) signed by person with disposal rights (including co-owner(s) of the assets) should be provided. For mortgage object, valuation report should be issued by competent authorities; for pledge object, rights certification; for guarantee by the third party, written documents and relevant credit proof documents on the fact that the guarantor agrees to bear irrevocable joint and several liability;

5. The borrowers, co-repayers and guarantors shall issue and sign in person written authorization documents in person to allow the bank to inquire about their credit reports;

6. Other proofs or documents required by the lender.

Case

For proposed studies in the United States in September, the Student, Miss Wang, plans to apply for 3-year loan to Bank of China to help her complete academic pursuit abroad. After inquiry about situation with Miss Wang, the sales account manager recommends Bank of China's foreign exchange loan for studying abroad to her. This loan can ensure direct lending of foreign exchange and effectively avoid exchange rate risk. Meanwhile, procedures of the loan are so simple that Miss Wang only need to provide identity documents, income proof of her parents, admission letter of the target university and relevant assets proof documents. Compared with RMB loan, foreign exchange loan for studying abroad can also save much interest.

Take Miss Wang as an example,  she needs a loan of USD 100, 000 (appr. RMB 680,000); and under matching the principal and interest repayment, interest payments between RMB Loan for studying abroad and foreign exchange loan for studying abroad are compared as follows:

* Foreign exchange rate in the case refers to the quotation on July 9, 2009, and the effective exchange rate is subject to the current quotation.