How To Get An International Student Loan – Rebecca Safiye | In all blogs Student Loans | October 31, 2022 | Updated: September 3, 2024
Taking out an international student loan for college or graduate school in the US is a smart financial decision. You’ll be repaying your student loans for years, so it’s important to compare loan options and find one that fits your needs. To help navigate these confusing waters, we’ve put together this information on how student loans work for international students in the US, read on to learn how to get an international student loan, how student loan interest rates work , and more.
How To Get An International Student Loan
A student loan is a type of loan that helps students pay for their education. If you have a student loan, your lender will usually send the money directly to your school.
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Your U.S. college or the university will reimburse you for tuition, fees, room and board, and any other applicable expenses specified at the time of application. If you have any money left over, you can use it for books, supplies and living expenses (be sure to contact the school to confirm their plans).
Student loans are not cash – they must be repaid with interest. Interest is money borrowed and the returns are fixed or variable. Some lenders also charge a fee for issuing or originating a student loan. It’s important to know the differences between the various personal and specific student loans to determine which option is right for you.
American students applying for student loans in the United States need to submit fewer documents to verify the loan than students applying from other countries. As part of the loan application process, international students must apply for a visa that authorizes them to study in the United States.
This includes knowing what visas are required to study abroad, applying for a visa, and preparing for and attending a visa interview with the US State Department.
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You can use student loan money for educational expenses while studying in the US, and your school must determine the amount of the loan. These costs will vary from one school to another, but may include;
You can also use student loan money to pay for everyday living, but it’s important to budget and only borrow what you need.
As an international student, you are not eligible for US government loans, but you can research private student loan providers. Most private student loans start earning interest the day the money is disbursed to your school.
For example, suppose you borrow $30,000 at 13.99% interest. Over a 10-year repayment period, your monthly payment will be $466, and you will pay a total of $25,874 in interest. Remember, if you want an interest-only loan like MPOWER while you’re in school, the payment will be lower.
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When you start paying off your student loan, part of your payment will go toward interest and part will go toward principal. If you can make additional payments, you can pay off the loan faster, which means less interest over the life of the loan. If you are planning to get your first loan, you should look for a lender that does not charge high fees.
One important thing to consider is whether you want a fixed or variable rate loan. Some international student loans are fixed-rate student loans, meaning that the interest you pay will remain the same for the duration of the loan. Others have variable rates that are often lower than the set rates but may increase over time.
Instead of an installment loan, student loans require monthly payments. You will receive a student loan bill each month during the repayment period. The standard repayment period for student loans is 10 years, but you can borrow based on your account and interest rate.
Repayment while in school depends on the lender. Some lenders prefer student loans that you don’t pay off while in school or a few months after graduation. After this billing period ends, you will begin making full payments each month. Others have an interest-only repayment period, meaning you’ll only make interest-only payments for a certain period of time, such as while you’re still in school. Remember, the less you pay on your student loan, the more debt you will have after graduation.
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Typically, you schedule a delinquent payment on your student loan by giving your credit bureau permission to collect payments from your bank account each month or until a set date. Most lenders offer a lower interest rate if you set up automatic payments. For example, MPOWER offers a 0.25% discount for setting up automatic payments.
An international student may be eligible for a private student loan from a bank, credit union, or online lender. Most lenders will require a co-owner who lives in the US, has good credit and a stable income.
Not every international student can get a co-signer who lives in the US or have to ask someone to share the debt. At MPOWER Financing, our international student loans are designed specifically for US students and do not require a co-signer or guarantor.
With an MPOWER student loan, you can borrow up to $100,000 at a fixed interest rate over a 10-year repayment period. While in school and six months after graduation, you will only have to pay the interest. At the end of this period, you will start making full interest and principal payments.
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You can apply for MPOWER student loan online as it is a completely digital process. Depending on your situation, you can be approved for a student loan in as little as two weeks. See our article on applying for international student loans to learn more about the loan application process.
CREDITOR – Subject to loan approval, loans are provided by Lake Mills Bank or MPOWER Finance, PBC. Lake Mill Bank has no ownership interest in MPOWER Finance. Neither MPOWER Financing nor Bank of Lake Mills is associated with the school you attend or have attended. Mill Lake Bank is a member of the FDIC. None of the information contained on this website constitutes a recommendation, solicitation or offer by MPOWER Financing or its affiliates to buy or sell any securities or other financial instruments or other assets or to provide investment advice or services.
Cube at Karle Town Centre, 9th Floor, 100 Ft, Nada Prabhu Kempe GowdaMain Road, Post Nagavara, Bengaluru, Karnataka 560045, India Borrowing money through a legitimate private lender is the best way to afford education without involving the mafia? . Many companies offer loans to US citizens, but very few offer loans to international students.
Most international student lenders require that you take out the loan with a co-sponsor who is a US citizen or permanent resident. This is a guarantee provided by the lender if the borrower defaults on the loan or leaves the United States. Unfortunately, this also limits who can get a loan, as some borrowers may not have family or friends in the US who are willing or able to act as co-signers.
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However, a small number of lenders allow you to get an international student loan without a co-signer.
Even if you find a lender that offers student loans to international students, it’s important to consider the benefits of the loan because it will affect you for years to come. Private student loans are generally credit-based, applied against federal interest for students using the FAFSA, and loans offer variable or fixed interest loans. Variable loans, also known as floating loans, are loan terms that offer two pending dependencies: The rate was based on the London Interbank Offered Rate (LIBOR), but now it is based on SOFR. Night financing rate), when the loan rate is set equal to the loan repayment. A variable rate loan is risky because, unlike diamonds, it doesn’t last forever; even if a low SOFR gives you a low rate, if the SOFR increases, your interest rate will also increase. However, the fixed interest rate remains the same throughout the life of the loan, but this can also be dangerous because if the loan starts at a high price, then the rate remains high throughout the loan period. Many people believe that in uncertain economic times, a fixed rate loan is ideal for international students who want stability and certainty in their repayment plans.
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