Ibrahim Gardner
International students often need to secure additional financial aid to fund their studies in the US, as they cannot receive federal student loans from the US government. Private student loans are available to international students to help cover these costs, but they usually require a cosigner – a US citizen or permanent resident with a good credit score and income history. However, some universities and colleges offer no-cosigner loans, and there are lenders such as MPOWER Financing that offer international student loans without a cosigner or collateral. Aside from loans, international students can also apply for scholarships, grants, and cash payment plans to fund their education.
| Characteristics | Values |
|---|---|
| Who can get a loan? | International students studying in the USA |
| Who provides the loan? | Private lenders |
| Who can be a co-signer? | A permanent resident or a US citizen with a good income history, good credit rating, and has lived in the US for at least two years |
| What is the loan amount? | Up to the total cost of school minus any other financial aid received |
| What is the repayment period? | 10–25 years |
| What are the repayment options? | Full deferral, interest-only, immediate repayment, full deferment |
| What can the loan be used for? | Tuition, books, fees, insurance, room and board, transportation, health insurance, travel expenses |
| What are the interest rates? | Variable, depending on the credit of the borrower and/or the co-signer |
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What You'll Learn
International student loan requirements
International students looking to study in the US can apply for international student loans, which are private education loans. These loans are available to international students as they are typically unable to receive federal student loans from the US government.
- Valid visa: A valid visa is typically required, with an expiry date that is at least six months after the end of the enrollment period for which the loan is being requested.
- Cosigner: Most international students need a US cosigner to apply for a loan. The cosigner must be a permanent US resident or citizen with a good credit rating and income history. They must also have lived in the US for at least two years. The cosigner is legally responsible for repaying the loan if the borrower fails to pay. If you cannot find a cosigner, there are a growing number of universities and colleges that offer no-cosigner loans.
- Credit history: The borrower's credit history will be considered. In some cases, a cosigner with a good credit score can help secure a loan and even result in a lower interest rate.
- Loan amount: The loan amount can vary and is typically determined by the total cost of education, minus any other financial aid received. The school's financial aid office can help determine the maximum loan amount.
- Interest rate: The interest rate is calculated using a benchmark rate (Prime Rate or SOFR) plus an additional percentage based on the creditworthiness of the borrower or cosigner.
- Repayment plan: Understanding the repayment plan is crucial. International students typically cannot work while studying in the US, so they must consider the monthly payments, when repayment begins, and the deferral period. The standard repayment period ranges from 10 to 25 years.
Sources of International Student Loans
International students can use loan comparison tools to find eligible lenders that provide loans to international students. These tools allow students to compare terms and conditions to find the best option for their needs. Additionally, schools may offer financial aid in the form of scholarships, grants, and payment plans, which can reduce or eliminate the need for loans.
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Loan repayment plans
International students looking to study in the US often require loans to cover their expenses, including tuition, books, transportation, and living costs. While international students cannot receive federal student loans from the US government, they can access private student loans from various lenders. These loans typically require a cosigner who is a US citizen or permanent resident with a good credit score and steady income. However, some universities and colleges offer no-cosigner loans.
When it comes to loan repayment plans, there are several options available to international students:
Full Deferral
With this option, students can defer loan payments until six months after graduation, as long as they maintain full-time status. The maximum deferral period is usually four years, which aligns with the typical length of an undergraduate degree.
Interest-Only Payments
Under this plan, students only pay the interest on the loan while they are still in school, for up to four consecutive years of full-time study. They can defer the principal amount until 45 days after graduation. However, if they drop to part-time status, they may need to start repaying the principal immediately.
Extended Repayment Periods
The repayment period for international student loans typically ranges from 10 to 25 years. This extended period provides flexibility for students who may not be able to make large monthly payments immediately after graduation.
It's important for international students to carefully consider their loan options and understand the repayment terms, including monthly payments, the start of repayment, and the possibility of deferring payments. Additionally, exploring cash payment plans offered by some schools can help minimise debt after graduation.
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Finding a cosigner
International students often need a cosigner to secure a loan. This is because international students typically don't have a long US credit history or income in the country, which lenders use to assess whether a loan can be repaid.
A cosigner is someone who agrees to share legal responsibility for your student loan. If you miss a payment or can't repay the loan, the cosigner becomes responsible for the remaining balance. Cosigners can be anyone from a close friend or relative to a mentor, religious leader, or former professor, as long as they meet the lender's criteria. The cosigner should be someone you know and trust, and who trusts you to pay back the loan in full and on time.
When asking someone to be your cosigner, it's important to be prepared. You should explain why you need the loan amount and show them a breakdown of your expenses and budget. Create a solid repayment plan that includes your job prospects and anticipated income after graduation, and let them know what you would do if you couldn't make a payment. It's also helpful to let them know if there's a cosigner release option, which many lenders offer after a certain period of on-time payments.
If you're unable to find a cosigner, there are lenders that offer no-cosigner loans, such as MPOWER Financing. These loans are based on criteria such as your school, program of study, academic performance, and career and income prospects. Alternatively, many schools offer cash payment plans that allow students to pay tuition and fees directly, reducing or eliminating the need for loans.
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Private student loans
International students usually require a cosigner, who is a joint applicant on the loan and takes responsibility for repayment if the primary borrower misses any payments. The cosigner should be a US citizen or permanent resident with a good credit score, a steady income, and proof of employment. They must have lived in the US for at least two years. Family members or friends can act as cosigners. If you are unable to find a cosigner, there are a growing number of universities and colleges that offer no-cosigner loans.
There are several private student loan providers that cater specifically to international students, including MPOWER Financing, Prodigy Finance Student Loan, and Citizens Bank. It is important to compare different lenders and loan options to find the best interest rates and repayment terms that suit your needs.
Before applying for a private student loan, it is recommended to explore other financial aid options, such as scholarships, grants, and fellowships offered by your country's embassy or governmental educational office. You can also use scholarship search engines, such as the one provided by the U.S. Department of Labor, to find applicable scholarships, fellowships, grants, and financial aid awards. Additionally, many schools offer cash payment plans that can help reduce or eliminate the need for loans.
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Scholarships and grants
IEFA is a comprehensive database of scholarships, grants, and loans for international students. It has partnered with leading providers of international student loans, enabling talented students to pursue their dreams of an international education.
InternationalStudent.com provides a free, up-to-date, and comprehensive list of scholarships, grants, and other awards available to international students from around the world. Students can search for awards by location, subject of study, student origin, or award name.
EduPASS also provides a list of scholarships for international students, including the Aga Khan Foundation International Scholarship, which provides scholarships to students from select developing countries who have no other source of financial help for their graduate studies. The American Association of University Women offers fellowships for non-American women seeking a Master's or doctorate in the USA, with priority given to those committed to advancing women and girls. The Civil Society Leadership Awards offer full scholarships for Master's students from specific countries dedicated to fostering social change. There are also scholarships specifically for Mexican and Colombian students pursuing postgraduate studies abroad.
InternationalStudent.com also offers a scholarship search for international students, with a comprehensive and searchable database of grants, scholarships, and loan programs. Fastweb provides access to 1.5 million scholarships worth $3.4 billion. Students can create a profile and keep track of their applications on the website. Buddy4Study is a scholarship search engine for Indian students applying to schools in the USA and other countries.
Additionally, the Foreign Fulbright Student Program offers scholarships for graduate students from around the world, as well as young professionals and artists, to study in the USA. The Joint Japan/World Bank Graduate Scholarship Program provides comprehensive financial coverage, including tuition, a monthly stipend, airfare, health insurance, and travel allowance, to students from developing countries who have supported their home country's development and are applying for a development-related Master's program. MPOWER Financing offers scholarships for international and DACA students through its Global Citizen Scholarship Program, with broad eligibility criteria and niche scholarships. For students from Central America, the MPOWER/InternationalStudent.com Central America Scholarship Program offers up to $3,000 toward international education.
Many schools also offer scholarships and grants specifically for international students. For example, Post University offers a range of financial aid options, including scholarships, grants, payment plans, and unique on-campus and online international student scholarships that do not require a separate application.
It is important to note that scholarships and grants may have specific eligibility criteria and application processes, so be sure to carefully review the requirements and instructions for each opportunity.
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Frequently asked questions
International student loans are private loans that can be used to cover education-related expenses such as tuition, books, fees, insurance, and room and board.
The requirements for an international student loan vary depending on the lender. However, most lenders require a cosigner who is a US citizen or permanent resident with a good credit score and income history. Some lenders, such as MPOWER Financing, offer loans that don't require a cosigner.
When choosing an international student loan, it is important to compare different lenders and their borrowing requirements, interest rates, fees, and repayment terms. It is also crucial to consider how much the monthly payments will be and when repayments will begin.
To apply for an international student loan, you will need to select your citizenship and school, review the eligible loan options, and choose a lender that suits your circumstances. You may also need a temporary US address and an F-1 student visa. The application process typically involves completing an online application, which may take 2-6 weeks for initial approval.
In addition to private student loans, international students can explore scholarships, grants, and cash payment plans offered by their schools. Programs such as the Fulbright Foreign Student Program and AAUW International Fellowships provide scholarships specifically for international graduate students.
