Common mistakes international students make when applying for an education student loan
From understanding loan terms to properly assessing funds and expenses, students navigating the education student loan process face a steep learning curve.
If you’re applying for an international student loan, this may be the first major financial decision of your life. MPOWER Financing wants you to tackle this process fully informed. Read on to discover the ins and outs of the loan application process, common mistakes to avoid and why you should consider financing your postgraduate international education with a no-cosigner international student loan from MPOWER.
How do loans work for international students?
International students have a variety of loan options. Of the available private education lenders, NerdWallet and CNBC identify MPOWER’s no-cosigner international student loan as the best private loan option for postgraduate international students studying in the U.S.
You can use education student loans to cover all education-related expenses during your study abroad journey in the U.S., including tuition, housing, books and health insurance. In Canada, loan funds can cover tuition and any other university-invoiced expense.
Here are the major steps of the education student loan process for international students:
1. Identify potential lenders for your education student loans
Research potential education lenders. Different loan options will have different loan terms such as:
Some education lenders may offer unique benefits. For instance, All MPOWER students gain access to MPOWER’s Path2Success Program, which provides international students with visa support, financial empowerment and career services.
Research your options thoroughly and identify the education student loans with the terms and conditions that best suit your needs.
2. Check your eligibility for your educational student loans
Make sure you meet your education lender’s criteria, from visa requirements to academic performance. Some lenders may also require a minimum credit score or a U.S. cosigner.
3. Can international students get student loans without a cosigner?
MPOWER understands that international students without credit or an available U.S. cosigner may struggle to qualify for most private student loans in the U.S. and Canada. That’s why MPOWER offers no-collateral, no-cosigner international student loans with no minimum credit score requirement.
4. Determine the amount you need to borrow with your education student loan
It’s important to borrow enough to cover your education expenses without accidentally overborrowing and landing yourself in unnecessary debt down the line. Carefully add up your education expenses. Then, subtract all your existing funding, from personal savings to financial aid to anticipated income. The result should be the amount you need to borrow.
You can borrow up to US$100,000 with MPOWER to cover your education expenses. When you apply, MPOWER asks you to list your funding sources to help you determine the right amount for your no-cosigner international student loan.
5. Gather documentation
You’ll need to provide:
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- Admission letter to a college or university
- Passport
- Proof of residence
- Financial documents
6. Fill out the education student loan application
Fill out your loan application carefully. If you submit an inaccurate or incomplete application, you risk delaying the process or having your application rejected. Consider asking a family member or friend who has been through the loan process before for assistance.
What are three considerations when getting a student loan?
A no-cosigner international student loan from MPOWER can make your dream of studying in the U.S. possible. All loans, however, come with the following considerations:
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- Interest accrual: The nature of a loan ensures that you will eventually pay back more than you originally borrowed.
- Deferred financial goals: The challenge of following your repayment plan might cause you to defer other financial goals, such as buying a house.
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- Default is serious: Defaulting on your student loan payments can have serious financial consequences.
Despite these thoughts, most students studying in the U.S. choose to take out student loans. It is noteworthy that MPOWER makes its loan decisions based on a student’s future earning potential and the program of study a student will be pursuing. As a result, MPOWER has confidence in an approved student’s ability to handle education loan repayment.
With proper financial education and planning, you can take out education student loans without compromising your future credit or life plans.
Common mistakes to avoid when applying for an education student loan
Overlooking the fine print
Review every loan offer carefully. Make sure you understand the implications of your loan’s terms. Missing key details, such as a sizable application fee or strict repayment conditions, can create undue financial challenges down the road.
Misunderstanding interest rates
The interest rate is one of the most important details of your loan offer. It’s important to know your loan’s interest rate and understand whether it’s variable or fixed. Fixed interest rates are a hedge against inflation, which can be important in unpredictable times.
That said, the interest rate isn’t the only important condition of your loan offer. Don’t select an offer based on interest rate alone and neglect to consider fees, repayment terms and customer service, which all contribute to your borrowing experience.
Missing tuition deadlines
Though most private education student loans don’t have application deadlines, your college or university will have tuition deadlines, likely at the beginning of each semester. To secure the necessary funds in time, MPOWER suggests you apply for your student loans as soon as you apply to a school.
To apply for a no-cosigner international student loan from MPOWER, check your eligibility today.
Final thoughts: Avoiding common mistakes when applying for a no-cosigner international student loan
If you feel daunted by the student loan process, you’re not alone. You can peruse MPOWER’s blog for more information about applying for education student loans and to learn about the advantages of financing your education with a no-cosigner international student loan.
