Douglas Olsen
International students often face challenges when it comes to securing loans to fund their education. While federal loans are generally not available to non-citizens, there are alternative options. Private lenders, such as Prodigy Finance and Citizens, offer loans specifically for international students, with some providing no-cosigner loans. Additionally, organizations like College Board and NerdWallet provide resources to help international students find suitable loan opportunities. These loans can cover various expenses, including tuition, room and board, books, and insurance. However, international students should be cautious of dishonest scholarship offers and carefully review the terms and conditions of any loan they consider.
| Characteristics | Values |
|---|---|
| Lenders | Earnest, Citizens Bank, Ascent, Juno, Brazos, MPOWER Financing, Custom Choice Loan |
| Target Borrowers | International students, graduate students, undergrads, half-time students, DACA students, medical school students, STEM students |
| Loan Amount | Up to $225,000 lifetime, up to $400,000, $2,001 to $100,000 |
| Interest Rates | 10.78% fixed APR, 12.74% (13.72% APR), 11.16% APR, 9.99%, 0.25% discount for automatic recurring payments, 0.25% interest rate reduction for autopay |
| Cosigner | Required for most non-US citizens, must be a US citizen or permanent resident with good credit and a good income history, lived in the US for the past 2 years |
| Application | Online, through a comparison tool, initial approval within days or weeks |
| Other Requirements | Social Security Number, permanent US residence, enrolled in an accredited Title IV school, eligible school, demonstrate high career potential, graduate within the next two years |
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What You'll Learn
Private lenders for international students
International students in the US have fewer student loan options than US citizens. Unless they are eligible non-citizens who can qualify for federal student loans, they may need to borrow from a private lender.
International students can apply for loans from private lenders to help cover the costs of their education. Private student loans are available to international students to help cover the costs of tuition, books, transportation, and living expenses while studying at college in the US.
MPOWER Financing
MPOWER Financing provides international student loans for students studying in the US and Canada. They offer fixed-rate loans from US$2,001 to US$100,000 at competitive interest rates with up to a 0.25% interest rate discount. MPOWER does not require a cosigner or collateral. They make loan decisions based on the applicant's future potential rather than their past. They also provide visa guidance support and scholarships.
Earnest
Earnest offers competitive APRs, lacks fees, and has a consistently strong performance in every area measured by Investopedia. They do not charge origination or other fees. International students must apply with a cosigner who is a US citizen or permanent resident and will also need a permanent US residence. After graduation, there is a grace period of 9 months before repayment begins.
Citizens Bank
Citizens Bank features the highest loan maximums among lenders researched by Investopedia.
Ascent
Ascent is a good option for those looking for a lender with low minimum credit score requirements.
Custom Choice Loan
Custom Choice Loans are best for upperclassmen who are confident they can take advantage of the 2% Grad Reward. They stand out for features that enable faster loan repayment. They do not apply extra payments to the principal balance by default.
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Undergraduate international students and tax exemption
Undergraduate international students on an F-1 visa who have been in the US for five years or less are considered nonresidents for tax purposes. This means that they are exempt from paying Social Security and Medicare taxes. However, they may still need to file a nonresident tax return, particularly if they have earned wages, a taxable scholarship, fellowship grant, or any other income that is taxable under the Internal Revenue Code.
Nonresident alien students are exempt from Social Security and Medicare taxes on wages for services performed within the United States. However, they may be liable for these taxes if they have been in the country for more than five calendar years and meet the "Substantial Presence Test," becoming resident aliens for US tax purposes.
It is important to note that international students with F-1 visas need to complete and mail IRS Form 8843 each spring to declare their exempt status for the previous year. Additionally, if they have earned wages, they may need to file a Tax Return (1040NR or 1040NR EZ form) along with Form 8843. Nonresident tax returns can be complicated, especially when scholarships, stipends, international tax treaties, investments, capital gains, or other sources of income are involved. Therefore, it is recommended to seek assistance from a CPA familiar with nonresident taxes or use software specifically designed for nonresident tax returns, such as SprinTax.
Regarding loans, international undergraduate students typically require a US co-signer with good credit who has lived in the US for at least the past two years. However, some lenders, such as MPOWER Financing, offer loans that do not require a co-signer or collateral. These loans are available for students attending eligible colleges or universities in the US and Canada, with fixed-rate loans ranging from US$2,001 to US$100,000 at competitive interest rates. MPOWER Financing also provides visa guidance support and scholarships.
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International student loan comparison tools
International students often have fewer student loan options than citizens of the country in which they wish to study. International student loan comparison tools can help students find the right loan for their circumstances.
NerdWallet
NerdWallet's international student loan comparison tool allows users to compare interest rates, terms and conditions, and find lenders that specialize in working with international students. The website also provides guidance on who can qualify for federal student loans as an eligible non-citizen. In addition, NerdWallet's student loans content includes articles, reviews, and recommendations produced by a team of writers and editors specializing in consumer lending.
InternationalStudentLoan.com
The InternationalStudentLoan.com comparison tool helps international students in the US or Canada, and US students studying abroad, find a lender in 10 seconds or less. Students answer a few simple questions and are matched with lenders that offer financial aid, fair terms, and reasonable interest rates. The website also provides a list of eligible lenders at specific schools.
MPOWER Financing
MPOWER Financing provides international student loans for students studying in the US and Canada. While not a comparison tool, MPOWER offers fixed-rate loans from US$2,001 to US$100,000 at competitive interest rates, with up to 0.25% in interest rate discounts for automatic recurring payments. MPOWER also provides scholarships and visa guidance support.
It is important to note that most loans for non-US citizens will require a US cosigner with good credit who has lived in the US for at least two years. However, some lenders, such as MPOWER Financing, offer no-cosigner loans.
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No-cosigner loans for international students
International students often face challenges when it comes to securing loans for their education, as traditional student loans in the US and Canada typically require a cosigner—someone who agrees to repay the loan if the borrower defaults. This poses a significant hurdle for international students who may not have connections in these countries. However, there are a few alternative options available for international students seeking no-cosigner loans.
MPOWER Financing
MPOWER Financing offers no-cosigner loans for international students planning to study in the US or Canada. They provide fixed-rate loans ranging from US$2,001 to US$100,000 at competitive interest rates, with up to a 0.25% interest rate discount for automatic recurring payments. MPOWER's application process is designed for efficiency, with a quick eligibility check and timely updates. They base their loan decisions on the student's future potential and academic merit rather than their credit history. Additionally, MPOWER provides access to scholarships, grants, and various services tailored to meet the unique needs of international students.
Private Lenders
Some private lenders, such as banks and credit unions, may offer international student loans without requiring a cosigner. However, it is important to note that these loans may have stricter eligibility requirements, and the interest rates may be higher compared to loans with a cosigner. Students can use loan comparison tools to research the terms and conditions of such loans and apply directly through the lender.
Scholarships and Grants
In addition to no-cosigner loans, international students can explore other forms of financial assistance, such as scholarships and grants. Scholarships are typically awarded based on academic excellence, leadership, or specific talents, while grants are often need-based and offered by educational institutions, governments, or private organizations. Work-study programs provide another option, allowing students to work part-time, often on campus, to earn money for their expenses while gaining practical experience.
Eligibility Requirements for No-Cosigner Loans
International students seeking no-cosigner loans should be aware of the eligibility requirements. Lenders may consider factors such as the student's credit history and score in the US (if applicable), family financial statements, academic success, graduation date, university reputation, course of study, and projected post-graduation income. Additionally, students may need to qualify for a student visa and live in the US while attending school.
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International student loans for US and non-US citizens
International students typically do not have access to federal student loans, but there are still options available. Most loans for non-US citizens will require a US co-signer, but there are a growing number of universities and colleges that offer no-co-signer loans. Here are some options for international student loans for US and non-US citizens:
MPOWER Financing
MPOWER Financing provides international student loans for students studying in the US and Canada. They offer fixed-rate loans from US$2,001 to US$100,000 at competitive interest rates with up to 0.25% in interest rate discounts. MPOWER does not require a co-signer or collateral and makes loan decisions based on the student's future potential rather than their past. They also provide visa guidance support and scholarships.
Prodigy Finance
Prodigy Finance provides graduate loans to international students attending programs at more than 1,800 schools worldwide. They base their loan decisions on applicants' future earning potential rather than their current financial situation, and they do not require collateral or a co-signer. However, Prodigy Finance is not available in all states and is only for graduate degrees.
Citizens Bank
Citizens Bank offers undergraduate, graduate, and parent loans for international students with a co-signer who is a US citizen or permanent resident with good credit. They provide multiyear approval loans, which cover each year of college with one application, and refinancing options for both student and parent loans.
Private Lenders
There are also private lenders that offer international student loans. These loans typically require a co-signer who is a US citizen or permanent resident with a good income history, good credit rating, and has lived in the US for the past two years. It is important to compare different private lenders to find the best loan option for your needs.
In addition to these options, international students can also explore financial aid from their home country, international organizations, or third-party organizations that offer student aid for non-citizens studying in the United States.
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Frequently asked questions
Prodigy Finance and Citizens are examples of organizations that provide loans to international students. Prodigy Finance offers loans to graduate students from over 120 countries, while Citizens offers undergraduate, graduate, and parent loans.
International students generally have fewer loan options than citizens and often require a cosigner who is a US citizen or permanent resident with good credit. It is important to carefully review the terms and conditions of loans and consider seeking advice from a financial advisor.
International student loans can typically be used for education-related expenses, including tuition, room and board, books, travel, health insurance, and living expenses.
