What Type of Student Loans Are Available to International Students?
Each year, more than a million international students come to the U.S. to pursue a college education. According to SEVP, in 2021 international students in the U.S. came from 225 countries and pursued over 1,400 different majors.
Studying in the U.S. can be an invaluable experience, but financing an education in another country can be difficult since international students aren’t eligible for U.S. federal grants or U.S. federal student loans. While this limitation can be disheartening, options are still available for those who wish to pursue higher education in the U.S.
Student loans for international students are available to help you cover common educational costs like the tuition. In this article, we’ll discuss these loan options in detail so you can make an informed decision about how best to finance your studies.
Who Is Considered an International Student?
For the purposes of federal financial aid, international students are individuals that want to study in the U.S. but are not U.S. citizens or permanent residents. Some groups – such as refugees or those granted asylum – can qualify for federal aid, but the availability of aid is limited for others.
Undocumented students, including Deferred Action for Childhood Arrivals (DACA) students, are not eligible for Federal aid.
Where to Find Student Loans for International Students
Because international students are ineligible for federal student loans, you’ll need to explore other financing options to pay for your education in the U.S. Alternative loan options fall into three categories: institutional loans, cosigned private loans, and no-cosigner private loans.
Institutional Student Loans
Although you may not be eligible for federal student loans, you may qualify for institutional loans. Institutional loans are issued by the college you attend, and they have no connection to federal aid.
The college or university sets its own eligibility requirements, interest rates and repayment terms. Many schools will issue them to international and DACA students.
For example:
- Brown University: Brown University offers institutional loans for undergraduate, graduate and medical students. The loans have relatively low fixed interest rates, 10-year repayment terms and six-month grace periods.
- Northwestern University: At Northwestern University, international students can qualify for either a Northwestern University Loan (NU Loan) or an endowed loan to pay for school. These loans allow you to borrow up to the total cost of attendance and have fixed interest rates.
- The University of California, Berkeley: Berkeley has a range of institutional loans available, including options for undergraduate, graduate and law students. It has loans specifically for international students with low fixed interest rates, and the interest is subsidized while the student is in school.
Contact your selected college’s financial aid office to see if institutional aid is available and the process to apply.
Cosigned Private Loans
Unlike federal loans, banks, credit unions, and online lenders issue private loans.
However, these lenders usually have strict eligibility requirements regarding citizenship status.
Most lenders require borrowers to be U.S. citizens or permanent residents to qualify for a loan. If you don’t fit those criteria, some lenders will approve your application if you have a cosigner that is a citizen or permanent resident.
The cosigner can be a parent, relative or close friend, as long as they have an established credit history and a reliable source of income. The cosigner takes on the responsibility of repaying the loan if you fall behind and decrease the amount of risk the lender takes on.
However, few international students have family members or friends that are U.S. citizens, so adding a cosigner may not be a realistic option.
Private Loans Without a Cosigner
Some lenders – such as MPOWER Financing – have loan options specifically designed for international students.
MPOWER’s loans don’t require cosigners, nor do you need to provide any form of collateral. You can borrow anywhere from US$2,001 to US$100,000 to cover the cost of your education, and you can get a fixed interest rate that will never change.
While you’re in school and for six months after graduation, you can make interest-only payments. After you leave school and complete the loan’s grace period, you must make full payments against the interest and principal. All loans have a 10-year repayment term, but there is no prepayment penalty if you decide to pay off your loan faster.
Who Is Eligible for an International Student Loan from MPOWER?
MPOWER’s loans are available to international students, DACA recipients, U.S. citizens, refugees and asylum-seekers.
To qualify for MPOWER’s student loans for international students, you must meet the following criteria:
- Enrollment: You must be admitted to or currently attending school at one of MPOWER’s 400+ supported universities. You can find out if your school is eligible by viewing MPOWER’s partner list.
- Level: You must be an undergraduate or graduate student within two years of your graduation date.
- Current ID: When you apply, you will be asked to submit a copy of a valid, unexpired government-issued photo ID.
- Supporting documents: You’ll be asked for supporting documentation, such as your passport, past transcripts, a school admissions letter, English proficiency exam scores and proof of home country address.
The entire process, from application to loan disbursement, can take several weeks or even months, so starting early is a good idea. With MPOWER, you can apply as early as 12 months prior to your semester’s start date.
Ready to get started? You can apply for education loans for international students at any time.
