What You Need to Know About Applying for International Student Loans

 February 26, 2020
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As the number of international students studying in the U.S. continues to climb each year — even while new enrollment slows — finding a way to pay for an international education continues to be a top priority for many students. Navigating a new system of financial aid can seem daunting, especially because federal student aid won’t be available to you. But there are many other funding options to explore. Here’s what you need to know about international student loans.

Student loans for international students

Without U.S. citizenship or qualifying for “eligible noncitizen” status, international students do not qualify for federal student aid.

That means you might search out private student loans instead — but most American lenders will need you to find a qualified cosigner. That person should not only have U.S. citizenship, but also a solid income and good credit score to help you get approved for the loan, said Leslie H. Tayne, a New York-based attorney specializing in debt relief. The private lender EDvestinU, for example, requires your cosigner to have a strong credit history and an annual income of at least $30,000.

International students commonly use a cosigner who’s not a parent, but is a relative living in the U.S., said Richard Neilsen, education loan program manager at New Hampshire Higher Education Loan Corporation, the parent entity of EDvestinU. As is the case for American applicants, the international student seeking the loan must also be enrolled at least half-time at a degree-granting institution, Neilsen said.

Without a cosigner, it is possible, though more difficult, to find college financing as an international student. Although they’re in the minority, lenders like MPOWER Financing and Prodigy Finance do not require a cosigner on student loans for international students.

Application process for international student loans

The application process typically takes place online, but most lenders offer customer service support by phone. You can start by completing a form that asks for information about you, your school and your desired loan.

At a typical bank, you might be asked for:

  • School information: Major(s) and period of enrollment
  • Loan information: Amount requested and other financial aid
  • Financial information: Income and monthly mortgage or rent payments
  • Personal information: Permanent address and temporary or in-school address

Some lenders request additional details. MPOWER Financing, for example, asks how you’ll use your loan. Your options may include:

  • Tuition
  • University housing
  • Health insurance
  • Meal plan
  • Other school bills

Depending on the lender, you may upload your documents during this initial application or after you’ve been approved. U.S.-based lenders also often require a copy of your visa or other immigration documentation.

At MPOWER Financing, for example, you could receive a conditional offer within three days after submitting your application. You’d then upload documents, such as your college admission letter, to verify your application.

Once you’re approved, your school receives the loan funds. At MPOWER Financing, the entire process could take two to ten weeks.

Before you take out an international student loan

Before resorting to a U.S. private loan, search for scholarships, grants and fellowships, since you won’t have to pay them back. The U.S. Department of State, in fact, is a good resource for gift aid for international students. Consult your school’s financial aid office early and often during this process, too.

If taking out a loan becomes a necessity, survey options in your own country. If you’re from India, for example, compare the international student loans offered by HDFC Credila Financial Services to the quotes you receive in the U.S.

Finding the right lender for international student loans

If you decide student loans are necessary, it can be difficult to find a lender that is willing to work with you. But it’s not impossible. The first step in finding the right lender is ensuring you’re eligible, generally based on the following factors:

  • Your nationality
  • The U.S. school you’ll attend
  • Your major or degree program
  • Whether or not you have a cosigner

You might want to consider the pros and cons of taking out a student loan with a big bank like SunTrust Bank’s Union Federal or Citizens Bank. Each offers international student loans.

You’ll also want to make a side-by-side comparison of lenders, big and small, looking at the following factors:

  • Fixed and variable interest rates
  • Aggregate loan limits
  • Grace period
  • Deferment and forbearance options
  • Repayment term lengths

To find out more about private student loans, check out our resources for international students.

Sarah Sharkey contributed to this report.

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LenderVariable APREligibility 
2.49% – 13.85%1Undergraduate
Graduate

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2.55% – 11.44%2Undergraduate
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3.25% – 13.59%3Undergraduate
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0.00% – 23.00%4Undergraduate
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3.25% – 9.69%6Undergraduate
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VISIT CITIZENS

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* The Sallie Mae partner referenced is not the creditor for these loans and is compensated by Sallie Mae for the referral of Smart Option Student Loan customers.

1 Important Disclosures for College Ave.

CollegeAve Disclosures

College Ave Student Loans products are made available through Firstrust Bank, member FDIC, First Citizens Community Bank, member FDIC, or M.Y. Safra Bank, FSB, member FDIC.. All loans are subject to individual approval and adherence to underwriting guidelines. Program restrictions, other terms, and conditions apply.

  1. As certified by your school and less any other financial aid you might receive. Minimum $1,000.
     
  2. Rates shown are for the College Ave Undergraduate Loan product and include autopay discount. The 0.25% auto-pay interest rate reduction applies as long as a valid bank account is designated for required monthly payments. Variable rates may increase after consummation.
     
  3. This informational repayment example uses typical loan terms for a freshman borrower who selects the Deferred Repayment Option with a 10-year repayment term, has a $10,000 loan that is disbursed in one disbursement and a 8.35% fixed Annual Percentage Rate (“APR”): 120 monthly payments of $179.18 while in the repayment period, for a total amount of payments of $21,501.54. Loans will never have a full principal and interest monthly payment of less than $50. Your actual rates and repayment terms may vary.

Information advertised valid as of 9/15/2022. Variable interest rates may increase after consummation. Approved interest rate will depend on the creditworthiness of the applicant(s), lowest advertised rates only available to the most creditworthy applicants and require selection of full principal and interest payments with the shortest available loan term.


2 Rate range above includes optional 0.25% Auto Pay discount. Important Disclosures for Earnest.

Earnest Disclosures

Actual rate and available repayment terms will vary based on your income. Fixed rates range from 3.47% APR to 13.03% APR (excludes 0.25% Auto Pay discount). Variable rates range from 2.80% APR to 11.69% APR (excludes 0.25% Auto Pay discount). Earnest variable interest rate student loan refinance loans are based on a publicly available index, the 30-day Average Secured Overnight Financing Rate (SOFR) published by the Federal Reserve Bank of New York. The variable rate is based on the rate published on the 25th day, or the next business day, of the preceding calendar month, rounded to the nearest hundredth of a percent. The rate will not increase more than once per month. Although the rate will vary after you are approved, it will never exceed 36% (the maximum allowable for this loan). Please note, Earnest Private Student Loans are not available in Nevada. Our lowest rates are only available for our most credit qualified borrowers and contain our .25% auto pay discount from a checking or savings account. It is important to note that the 0.25% Auto Pay discount is not available while loan payments are deferred.


3 Sallie Mae Disclaimer: Click here for important information. Terms, conditions and limitations apply.

4 Important Disclosures for Edly.

Edly Disclosures

1. Loan Example:

  • Loans from $5,000 – $20,000
  • Example: $10,000 IBR Loan with a 7% gross income payment percentage for a Senior student making $65,000 annually throughout the life of the loan.
    • Payments deferred for the first 12 months during final year of education.
    • After which, $270 Monthly payment for 12 months.
    • Then $379 Monthly payment for 44 months.
    • Followed by one final payment of $137 for a total of $20,610 paid over the life of the loan.

About this example

The initial payment schedule is set upon receiving final terms and upon confirmation by your school of the loan amount. You may repay this loan at any time by paying an effective APR of 23%. The maximum amount you will pay is $22,500 (not including Late Fees and Returned Check Fees, if any). The maximum number of regularly scheduled payments you will make is 60. You will not pay more than 23% APR. No payment is required if your gross earned income is below $30,000 annually or if you lose your job and cannot find employment.

2. Edly Student IBR Loans are unsecured personal student loans issued by FinWise Bank, a Utah chartered commercial bank, member FDIC. All loans are subject to eligibility criteria and review of creditworthiness and history. Terms and conditions apply.


5 Important Disclosures for Citizens Bank.

Citizens Bank Disclosures

  • Variable Rate Disclosure: Variable interest rates are based on the 30-day average Secured Overnight Financing Rate (“SOFR”) index, as published by the Federal Reserve Bank of New York. As of September 1, 2022, the 30-day average SOFR index is 2.23%. Variable interest rates will fluctuate over the term of the loan with changes in the SOFR index, and will vary based on applicable terms, level of degree and presence of a co-signer. The maximum variable interest rate is the greater of 21.00% or the prime rate plus 9.00%.
  • Fixed Rate Disclosure: Fixed rate ranges are based on applicable terms, level of degree, and presence of a co-signer.
  • Lowest Rate Disclosure: Lowest rates are only available for the most creditworthy applicants, require a 5-year repayment term, immediate repayment, a graduate or medical degree (where applicable), and include our Loyalty and Automatic Payment discounts of 0.25 percentage points each, as outlined in the Loyalty Discount and Automatic Payment Discount disclosures. Rates are subject to additional terms and conditions, and are subject to change at any time without notice. Such changes will only apply to applications taken after the effective date of change.

     

    Undergraduate Rate Disclosure: Variable interest rates range from 3.25%-10.35% (3.25% – 9.69% APR). Fixed interest rates range from 4.24% – 10.59% (4.24% – 9.93% APR). 

    Graduate Rate Disclosure: Variable interest rates range from 3.75%-9.90% (3.75% – 9.68% APR). Fixed interest rates range from  5.22% – 10.14% (5.22% – 9.91% APR). 

    Business/Law Rate Disclosure: Variable interest rates range from 3.75%-9.35% (3.75% – 9.16% APR). Fixed interest rates range from 5.20% – 9.59% (5.20% – 9.39% APR).

    Medical/Dental Rate Disclosure: Variable interest rates range from 3.75%-9.02% (3.75% -8.98% APR). Fixed interest rates range from 5.18% – 9.26% (5.18% – 9.22% APR). 

    Parent Loan Rate Disclosure: Variable interest rates range from 3.25%-9.21% (3.25% – 9.21% APR). Fixed interest rates range from 3.96%-9.50% (3.96%-9.50% APR).

    Bar Study Rate Disclosure: Variable interest rates range from 6.58%-11.72% (6.58% – 11.62% APR). Fixed interest rates range from 7.39% – 12.94% (7.40% – 12.82% APR). 

    Medical Residency Rate Disclosure: Variable interest rates range from 5.67%-9.17% (5.67% – 8.76% APR). Fixed interest rates range from 6.99% – 10.49% (6.97% – 10.08% APR).


6 Important Disclosures for Funding U.

Funding U Disclosures

Offered terms are subject to change. Loans are made by Funding University which is a for-profit enterprise. Funding University is not affiliated with the school you are attending or any other learning institution. None of the information contained in Funding University’s website constitutes a recommendation, solicitation or offer by Funding University or its affiliates to buy or sell any securities or other financial instruments or other assets or provide any investment advice or service.