Your Guide to International Student Loans
Surprised to know that being an international student you can still avail a student loan? Learn more about the lenders, criteria and other requirements to avail an international student loan with and without a cosigner in the United States.
Updated by Theres Ann on 20th November 2019
Education in the United States is not an easy affair. Financial aid is essential in funding one's education in the United States. Student loans are available for international students. Though international students cannot take up the different types of aid that are available for US residents, several other resources are available for them to achieve their goals. The different types of loans available are as given below.
International student loans with a co-signer.
International student loans without a cosigner
Additional financial aid options
International student loans US citizens can make use of the FAFSA that is available for them to learn about the various financial aid resources. Federal loans that are included under the federal assistance, does not include everything under one approach.
According to the Institute of international education, 73% of the international US students rely on resources outside the country in order to finance their education. The funding can come from the student’s own family members, home country government or university, personal funds and more.
Depending on the lender, the eligibility requirements and the process of the financial aid varies. Some lenders insist only on a student visa, whereas few others want a US Cosigner. Therefore it is necessary to find out the sources of financial aid and the application process of each of the programs.
List of contents
- International Student loans with a cosigner
- Documents required for Application
- Banks offering International Student Loans with a cosigner
- Cosigner Eligibility
- Why do lenders insist on having co-signers?
- How can a loan cosigner be found by an international student?
- How to obtain a loan without a cosigner?
- Options for Student Financial Aid
International student loans with a cosigner
Private educational loans are the most popular sources of loans for international students.
The eligibility requirements looked upon by most no-cosigner student loans include the duration until your graduation, the career potential, attending a school on the approved list and more.
Each lender has his or her own eligibility criteria. A loan comparison tool should be first used to find out the loan that does not need a cosigner.
The details of your conditions such that you don’t have a cosigner are entered. In case of availability of a no-cosigner loan, then the terms and conditions of the loan are to be explained. The interest rates and the repayment terms of the loan are studied.
Documents required for application
There are several procedures available for applying for a co-signer loan. A few of the essential documents required for the application process are as given below.
Standardized test scores
University invoice for financial summary
Employment letter or pay stub
I-20 Financial plan
Banks offering International student loans with a cosigner
A few of the banks that offer International Student loans with a co-signer include Ascent Tuition, Citizens One Student loan, Discover Student loans, Sallie Logo student loans, Wells Fargo and College Avenue.
1) Citizens Bank student loan
Citizens Bank – Open to international students if they have a co-signer on the loan application.
The maximum loan that is awarded to Citizens Bank is $1,00,000 for undergraduate students and for health-care professional students, it is $2,95,000.
Borrowers can then choose between a variable or fixed-rate loan.
Citizens One is one of the leaders to offer multi-year approval for student loans.
After the freshman year, loans can be requested for each subsequent school year, without undergoing a hard credit check.
This also affects the co-signers credit.
2) Discover student loan
Discover student loans are granted to international students who choose an eligible US College. A creditworthy cosigner is either the permanent resident of the United States or is a citizen.
The loan type decides the eligibility requirements, limits, rates, and terms of the loan.
Discover does not charge fees even if the payments are made late.
Several options are offered if you are struggling to make payments.
Some of these include up to 12 months of forbearance, up to 12 months of temporary interest rate reduction, up to six months of temporary payment reduction and more.
Cash reward for up to 1% for each new student loan for borrowers with at least 3.0-grade point average.
3) Wells Fargo
Borrowers of the Wells Fargo work with a dedicated student loan specialist for the lifetime of the loan. Several options available for the struggling borrowers includes
Up to 36 months of internship
residency or fellowship forbearance
up to three years of public service forbearance
Federal Emergency Management Agency disaster payment deferment
six month grace period extension
two months of short term payment relief
six months of payment relief due to financial hardships
Loan modification in order to temporarily or permanently lower your payment amount
Loan repayment options for past-due payments and more.
Finding a cosigner is difficult especially for an international student. A few of the essential qualities of a cosigner are as given below.
The cosigner should have a good credit score and a credit history. The security that is provided on the loan is that the co-signer has the ability to pay the loan in case the borrower doesn’t. Thus credit history and credit score of the cosigner is highly significant in granting the loan to the borrower.
The cosigner should be a US Citizen or a Permanent Resident. Making acquaintances and socializing becomes an important skill when it comes to it.
The cosigner should have a significant and stable source of income. In order to prove the eligibility for loan repayment, the lender asks for the recent pay stubs of the co-signer.
The cosigner should be willing to sign on your behalf. The number of people who are willing to cosign a loan is significantly less because, if in case the borrower forgets to make necessary payments then the credit history of the borrower will be affected.
Why do lenders insist on having co-signers?
Most international students might have their first-times in the United States and would be unaware of all the procedures for a financial aid application.
With so many uncertainties in hand, most international students find application for student loans a Herculean task. Hence, it is natural to think about the reasons why international students should need a co-signer for loan application. The reasons why lenders insist on cosigner-application for student loans is as given below.
1) Low/no credit score and credit history
As most international students would have just come into the United States, for their higher studies, they might not a good credit score or sometimes no credit score. Even if some would have started building credit in the initial days of the college, they would not usually have a good credit history.
2) Very little income for students
Income requirements for private students are also not met by the college students, as most often they wouldn’t have developed the necessary skills for a job or if in case they have developed the skills, they wouldn’t find sufficient time to spend for jobs, after their studies.
3) Very High-Interest Rates
There are some students who barely meet up the eligibility criteria, but do not have a cosigner. In this case, the lender can make you charge a much higher interest rate. Though the higher interest rate is an available option, in a long time this plan can be disadvantageous.
How can a loan cosigner be found by an international student?
Some of the ways in which borrowers find co-signers are as given below.
1) The borrower can have his friends or family to cosign
The most approachable set of people would definitely be your family or immediate friends.
An immediate friend or a family member, who is either a US Citizen or a permanent resident with good credit, can sign your loan if you are willing to approach them.
Both permanent residents and international students use family and friends as their co-signers.
2) The borrowers can check with the university alumni associations
The alumni associations of the universities would have members who have been in your shoes several years ago.
They might take up the responsibility to cosign your loans as they have been through everything that you are currently undergoing and they are living an established life.
In order to convince the alumni to pay for your loan, you’ll have to show commitment and academic progression.
3) The borrower can use an online loan cosigner match-up
You can request any connections on your social media platform to be your co-signer.
Websites such as the Cosigner Finder also help you in finding a willing and eligible co-signer to sign for your loan.
However, websites like this would charge you for the services offered.
How to obtain a loan without a cosigner?
It would definitely be difficult for an international student to cosign their loan. However, there are several options available to obtain a loan without a cosigner. Some of these methods are as given below.
Get a private loan through an online lender
Many online lenders have framed loans that would specifically suit the demands of an international student. Three top lenders who offer private loans for international students are as given below.
Stilt is designed for students and others who find it difficult to obtain loans in the United States.
Immigrants, international students, and DACA (Deferred Action for Childhood Arrivals) holders offer loans to immigrants, international students, and others who found it difficult to obtain a loan in the United States.
The loans were offered at an interest rate starting at 7.99%.
As they have fewest qualification requirements, Stilt is the top pick. Applications for loans can be received within 24 hours after application completion.
As Stilt does not partner with universities you can apply irrespective of the university you attend.
Stilt is the only lender that grants loans to international students without a cosigner.
Credit building can also begin with a Stilt loan.
MPOWER is another lender that lays more focus on international students and has a 7.99% minimum interest rate.
Loans are granted to students who have higher earning potential. However, one disadvantage of MPOWER is that it grants loans only for a few majors.
In order to be eligible to apply to the MPOWER, you should attend a school supported by MPOWER and you should also be in the last two years of your education.
Up to 10-years repayment period is granted for the loans.
This can make it difficult for undergraduate students and students of lower-tier universities to qualify.
The loan application process usually takes three weeks with MPOWER and the funds are directly passed on to the school rather than the borrower.
3) Prodigy Finance
If it is a private student loan that you are searching for, then Prodigy Finance is one such organization that grants you loans without the requirement of a cosigner.
The company was established in 2007, by three MBA students who recognized the need for financial needs of overseas students in the United States.
A borderless model is created by Prodigy to determine the potential and other factors beyond using a credit approval approach.
Borrowers can get a post-graduate student loan or can refinance an existing loan.
Students in over 150 countries can get a student loan or refinance an existing loan with prodigy. The loan approval process takes not more than 30 minutes.
Borrowers can apply for post-grad loan or can refinance an existing loan. A six month grace period is available for them to graduate before they begin to repay their loan.
MPOWER can help students of more than 190 countries to get their loans.
Factors such as the expected graduation rate, grades, scores, internships, work reports, and more are considered.
Fixed interest rate loans from $2001 to $50,000 are offered on a 6-year repayment plan. Students can pay tuition or education-related expenses.
Factors such as the school that the students will be attending, the expected graduation date, grades, scores, internships, work experience and more are considered to grant the loan.
The future debt of the student is also monitored.
Though the process sounds lengthy, this information is required for a formula that gets approved in 15 minutes.
Options for Student Financial Aid
Most often international students are left out of ways to apply for student financial aid. Few of the ways for the international students to go into refinancing is as given below.
You can qualify for federal aid only if you are a green cardholder. Thus international students are not eligible to apply for a federal loan. Your eligibility for financial aid will be determined by the FAFSA.
Private and Academic Scholarships
Scholarships are a great source of income for students of all backgrounds. Scholarships are available for all types of persons as well as their achievement.
A great advantage of the loan is that you’ll not have to make your repayment.
Despite the size, scholarships help the students. For college tuition, paying outright is the right option. Payments made during college time helps you to reduce loan and interest rates and helps in saving a lot of money.
Eligibility for financial aid for state or school is also be determined by the FAFSA.
Eligibility and requirements for Federal Aid
Applications for federal aid can be made by:
Cuban Haitian Entrants
Conditional Entrants (If you entered before April 1, 1980)
Anyone with a T-visa
Children of T-1 visa holders
Battered immigrant qualified aliens
Children of battered immigrant qualified alien
Citizens of Micronesia
Additional Financial Aid Options for International Students
A number of options are available for the international students who are looking for additional financial aid. The College Board scholarship information is available for more than 2,200 programs.
FastWeb is another great source of information. Berkeley College International Student Scholarship is available for eligible international students who are attending the program from nearly 75 countries.
The Fullbright Foreign Student Program will fund tuition, airfare, and allowances for living expenses and health insurance.
Most financial institutions do not offer direct aid to students. There will however be financial aid based on academic achievements, skills, talents, and abilities.
Some of the universities that offer top talents across the globe, by offering them financial aid include Harvard, Princeton, MIT, and the University of Pennsylvania.
Private Universities help with financial assistance for international students.
Scholarships are available for every type of person or achievement.
An efficient google search can help you in finding out the various options available for scholarships.
You’ll not have to make the repayment even in case of a great loan. Irrespective of the size, scholarships can help the students.
Family and personal savings
Any payments made throughout the time in college reduce loan and interest amounts and helps to save a lot of money in the long run.
You’ll not have to make a repayment in the case of a scholarship.
Payments that you make on your own throughout your time in college, can cause a reduction in the loan and interest amounts and helps you to save money in the long run.
The school’s admissions department can be contacted to find out the different types of financial aids that are available.
After a student has received enrollment in a US University, the international student advisor or the financial aid office can be contacted.
The academic merit can be proven by using stellar scores from standardized admission tests.
Whether you use a traditional approach or a non-traditional approach of application, be careful to not fall into international student loan scams.
Student loans are offered to students with or without a cosigner. However, the cosigner should either be a US citizen or a permanent resident of the United States. So it is best to first make use of financial aid and other personal savings that you have and only then opt for international student loans.