Tips for applying for a loan as an international student in the US
If you’re considering getting a loan to study abroad, you may have now have realized that there are certain challenges involved. Typically, it’s more difficult to get a student loan outside your home country, as federal and state loans are reserved for citizens. This is why international students are encouraged to exhaust all other options first, such as private funding or scholarships, before looking to take out a loan. But that doesn’t mean it’s impossible to get a loan as an international student, and in some cases, it may be the only option for you.
If you’re in need of financial assistance to help cover your study abroad expenses, here are some ways to go about it:
Get a co-signer
You can apply for a private loan with lower interest rates if you can get a co-signer who is a US citizen or permanent resident with good credit. So if you’ve got a relative or close friend in the US who wouldn’t mind helping you out, try reaching out to them to see whether they could be your co-signer.
Apply for a private loan
It isn’t too late to secure funding for this fall if you are an international student studying in the USA. No co-signer? You can still get a private loan. While the interest rates can be higher for international students because they’ve not yet built up their credit score, there are a growing number of loan providers offering loans to international students at good rates.
Rather than choosing a general private loan, looks for providers that offer products targeted to international students. Compare options and shop around for the one that provides the lowest interest rate. A good tip is also to choose a fixed interest rate that won’t increase over time, instead of a variable interest rate. To avoid racking up a large amount of student debt, make sure you are well-aware of your repayment deadlines and ensure you know the length of your loan period.
According to IEFA, “Repayment of an international student loan will vary depending on the loan you select. The repayment period typically ranges from 10-25 years; the standard rule of thumb is the larger the loan, the longer the repayment period. Some loans allow you to defer payments until 6 months after graduation, others allow students to only pay interest while in school (and defer the principal), and other loans begin repayment of both the interest and principal immediately once the loan has been paid out.
Refinance your student loans
If you stay in the US for some time and build up your credit, you should be able to refinance your loans later on at a lower interest rate. To do so, you’ll need a steady income and a credit score of 690 or higher. You can achieve this by paying your debts (such as your credit card or your student loan payments) on time every month.
