Lana Oconnell
International students often need additional funding to cover college costs, and many lenders require a co-signer who is a US citizen or permanent resident. Some banks and companies that offer international student loans include Citizens Bank, MPOWER Financing, Prodigy Finance, SoFi, and Ascent. These lenders offer a range of loan amounts, interest rates, and repayment options to meet the diverse needs of international students. It's important for students to carefully consider their options and choose a loan that best suits their financial situation and eligibility.
| Characteristics | Values |
|---|---|
| Lenders | Earnest, Citizens Bank, MPOWER Financing, Prodigy Finance, Ascent, SoFi, Nelnet Bank |
| Interest Rates | Earnest: Competitive APRs; Citizens Bank: Average APRs; MPOWER Financing: 9.99% interest rate (11.16% APR); SoFi: Low APRs |
| Credit Score Requirements | Earnest: Minimum 650; Citizens Bank: 700 for non-cosigned loan, 733 for cosigned loan; Ascent: Low minimum credit score requirement |
| Loan Amounts | Citizens Bank: $1,000 to $99,999; Prodigy Finance: Up to $220,000 |
| Cosigner Requirements | Earnest: Cosigner required; Citizens Bank: Cosigner must be a U.S. citizen or permanent resident; MPOWER Financing: No cosigner required |
| Fees | Earnest: No fees; Citizens Bank: No origination or late payment fees; SoFi: No origination or late payment fees |
| Repayment Options | Citizens Bank: Multi-year loans; MPOWER Financing: Flexible repayment options; Earnest: Multiple repayment terms, ability to skip one payment per year |
| Eligibility | Citizens Bank: Available in all 50 states; MPOWER Financing: Available for students in the U.S. and Canada |
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What You'll Learn
Banks offering loans without a cosigner
International students often face challenges in securing traditional financing for their education in the US or Canada. Most lenders require a cosigner—someone who is a US citizen or permanent resident and has good credit history. However, there are a few banks and lenders that offer loans without a cosigner for international students.
MPOWER Financing is one such lender that offers an innovative approach to educational loans for international students. MPOWER focuses on the student's future potential rather than their financial history or the need for collateral. They offer loans ranging from US$2,001 to US$100,000 to students from over 200 nationalities enrolled in more than 500 schools across the US and Canada. Their interest rates start at 9.99% (11.16% APR), and they also provide the opportunity to build a US credit history.
Earnest is another lender that offers fee-free private loans without origination or late fees. They provide undergraduate and graduate loans, loans for half-time students, and parent PLUS loans. They have low minimum interest rates and support both fixed and variable rates.
Ascent is a good option for students with low minimum credit score requirements, while Citizens Bank offers the highest loan maximums, with undergraduate and graduate students able to borrow up to $225,000 lifetime.
It is important to note that loans without a cosigner may have higher interest rates, and eligibility requirements vary among lenders. Students should carefully compare lenders and their criteria, considering interest rates, repayment terms, and potential for future earnings.
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Variable interest rates
For example, SoFi offers variable-rate loans where the interest rate for a given month is calculated by adding a margin to the 30-day average SOFR index, published two business days before the start of the month. This rate is then rounded up to the nearest 0.01%. SoFi's average APRs for variable-rate refinance loans are the lowest in our data. They do not have a fixed maximum amount for refinancing; instead, they will refinance up to the total amount of your qualified student loan debt. Additionally, SoFi offers an autopay discount of 0.25% and a SoFi+ membership discount of 0.125%.
Earnest also offers variable interest rates, which can be as low as a minimum or as high as a maximum among the lenders reviewed. They also provide several types of loans, including undergraduate and graduate loans, loans for half-time students, and parent PLUS loans.
Prodigy Finance is another lender that offers variable interest rates for international students. Their rates vary depending on whether a co-signer is involved. For example, an Indian resident student with a co-signer can expect a representative APR of 11.24% variable, based on a total credit amount of USD 41,600 (including a 4% admin fee). This loan is repayable over 180 months at a variable interest rate of 10.23% (5.90% fixed + 4.33% variable), with a monthly repayment of USD 536.46.
When considering variable interest rates, it is important to keep in mind that while rates may decrease, they can also increase, impacting the overall cost of the loan.
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Eligibility criteria
International students looking to secure a loan to study in the US will need to meet a set of eligibility criteria. These criteria vary depending on the bank or lender and the type of loan. Here are the common eligibility criteria for international student loans:
Citizenship and Residency Requirements
International students must usually be enrolled at an eligible US college or university to qualify for international student loan programs. Some lenders may require students to be enrolled at least half-time in a degree-granting program. Additionally, international students typically must have a creditworthy co-signer who is a US citizen or permanent resident. The co-signer often needs to meet specific criteria, such as having a good income history, a good credit rating, and sometimes residency requirements, such as having lived in the US for a specified period.
Credit Score and Income Requirements
Lenders may set minimum credit score requirements for international student loans. For example, Earnest, a lender recommended by Forbes, requires borrowers to have a minimum credit score of 650 and at least three years of credit history. Additionally, some lenders may require borrowers to demonstrate positive income. While there may not be a minimum income requirement, borrowers must show proof of income.
Loan Amounts and Interest Rates
International students should consider the loan amounts and interest rates offered by different lenders. Some lenders, like Citizens Bank, offer higher loan maximums to cater to students with significant borrowing needs. Additionally, lenders may provide interest rate discounts under certain conditions, such as having an existing account with the bank or enrolling in autopay.
Additional Considerations
International students should also be aware of any additional eligibility criteria or requirements specific to the lender or loan program. For example, some lenders may require borrowers to have no prior student loan defaults. It is essential to compare multiple lenders and loan options to find the best fit for your financial needs and eligibility.
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Repayment options
Other lenders, like Earnest, offer fee-free private loans with no origination or late fees. Earnest also provides multiple repayment terms and a nine-month grace period for graduate students, which is longer than the typical six-month grace period.
For international students without a cosigner, MPOWER offers loans with a 10-year repayment tenure and interest-only repayments during school and for six months after graduation. Ascent, on the other hand, offers tenure options ranging from 5 to 15 years and postpones full principal and interest payments for up to nine months after graduation.
Sallie Mae provides loan repayment options ranging from 10 to 20 years with three repayment plans, while College Ave and SoFi offer four different repayment options with tenures of 5 to 15 years.
It is important to note that most international students will require a cosigner with good credit who has lived in the US for at least two years. However, some colleges and universities do offer no-cosigner loans for international students.
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Loan amounts
The loan amount that international students can borrow varies depending on the lender and the student's circumstances. For example, College Ave Student Loans offer loans ranging from $1,000 to the cost of attendance. Similarly, Ascent offers loans from $2,001 to $200,000 per year, with an aggregate loan limit of $200,000. Citizens Bank offers loans from $1,000 up to $99,999, while undergrads and grad students can borrow up to $225,000 for their lifetime, and some medical school students can borrow up to $400,000.
Most lenders require international students to have a co-signer with good credit who is a US citizen or permanent resident. This person is jointly responsible for the loan and makes payments if the primary borrower is unable to. Some lenders, such as Earnest, do not require a co-signer but have other requirements, such as a minimum credit score of 650 and a minimum income of $35,000 per year.
International students should carefully review the loan details and eligibility requirements of different lenders to find the best option for their needs. It is also worth considering other sources of financial aid, such as grants, scholarships, and federal student loans. Additionally, the college or university you plan to attend may offer financial aid for international students, so it is worth checking with their financial aid office.
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Frequently asked questions
Some of the banks that offer international student loans in the US include Citizens Bank, One American Bank, FinWise Bank, and Prodigy Finance.
Citizens Bank offers borrowers the option of multi-year loans. Undergraduates and graduate students can borrow up to $225,000, while some medical school students can borrow up to $400,000. International students will need a co-signer who is a US citizen or permanent resident.
Yes, MPOWER Financing offers no-cosigner loans for international students in the US and Canada.
Earnest is known for its competitive APRs, lack of fees, and support for both undergraduate and graduate borrowers. Additionally, Ascent is a good option for those looking for a lender with low minimum credit score requirements.
