4 Benefits of Student Loans When You’re an International Student
September 9th, 2015 by Anum Yoon

piggy bankStudent loans are an integral part of college, especially in a country like the U.S. where tuition rates are sky high. However, international students are at a disadvantage when it comes to obtaining loans to help pay tuition. Federal loans are off the table and can only be acquired by citizens. However, more and more private loans are becoming available to international students. This is great news, as are some important benefits from obtaining student loans. Here are the benefits of student loans when you’re an international student:

  1. They Fill the Gap That Scholarships Cannot

If you’re studying internationally, hopefully you’ve scoured all available options for scholarships. Many universities will have opportunities for you, while some are known for being extremely generous to their international students. Getting your education fully funded is still unlikely unless you’re one of the absolute top students in your class.

Student loans aren’t merit based, so anyone attending an eligible school can potentially receive what they need to pay for school regardless of their grades. However, if you’re looking to go to school in the U.S., you’ll need a co-signer who’s either a permanent resident or a citizen. Your home country might also have some financial aid for international students; do a search for those.

Regardless, having to pay back loans is a lot less fun than receiving the money outright in a scholarship. Don’t fret – this brings us to the next benefit of student loans.

  1. The Rates Are Usually Reasonable

When it comes to private loans, the interest rates will vary quite a bit depending on where you go. The good news is that interest rates in the past few years have been comparatively low compared to the past. These lower rates make an enormous impact over time and make it a lot easier to pay off since you won’t be stuck with too much interest.

On the downside, tuition prices in the U.S. are at an all-time high. The low interest rates don’t cancel out those prices, but it does help lessen the burden.

  1. You’ll Have Time to Pay It Off

Every student loan is different, but it’s common to have to start paying back loans six months after graduation. From then, loans can be paid back over the period of about 10 to 15 years, or longer if the debt is large. Having such big debts when dealing with an uncertain job market is stressful for anyone, but at least there’s time to sort things out while making the minimum payment. If you find yourself in rough financial shape, it’s possible to get forbearance for a year or two where you only need to pay interest. The extra time allows you to get your finances in order, hunt down better deals for yourself in terms of car payments, housing and utility bills. Once you get those trimmed down and figured out – you’ll be a lot better at budgeting for your debt repayments.

  1. They Build Credit

If you’re planning a future beyond graduation in the country where you’re attending university, student loans are useful. By taking out a loan and paying it back responsibly, you’ll build up your credit score. The same goes for paying your credit card and utility bills on time. Having a good credit score helps out in the next stage of your life. It’ll allow you to increase your credit card limits, receive favorable interest rates on car and home loans and even make it easier to lease an apartment – some places do credit checks on potential renters. This is a nice bonus to those big loans you took out that pretty much lasts a lifetime.

Anum Yoon is an international student currently working in the U.S. on her OPT. She spends all her free time running a personal finance blog for fellow millennials and international students over at Current on Currency.

10 Comments

  1. reuben manaseh says:

    seeking application for scholarship

    • Jennifer Frankel says:

      Hi Reuben, thanks for your message. Unfortunately we can only assist with international student loans. If you have questions on this, please let us know. Thanks!

  2. Paula Andrea Sequera Mora says:

    quiero información si es posible estudiar con visa internacional y aplicar para becas en los Estados Unidos estoy muy interesada me gustaría saber mas sobre el tema o al menos tener tutoría sobre el tema gracias .

    • Jennifer Frankel says:

      Hola Paula, muchas gracias por contactarnos! Solamente podemos ayudar con prestamos. Para obtener una visa estudantil, tienes que solicitar a una escuela y cuando estas admitido, ellos te ayudan con el proceso.

  3. Ruth says:

    hi,i am Ruth . i need an advice.have been in the US for 3months now.but came in with a tourist visa, and i have this desire to go to school and work here,i dont wonna go back to my home country because its gonna take me awhile to get student visa.so i need some advice from you. i also have a question to ask. been a non citizen of the US , is it possible to get a student loan when i acquire admission into a university,and how do one pay back the loan. thanks ,hoping to here from you

    • Jennifer Frankel says:

      Typically you need to be admitted and enrolled, and have your visa, in order to apply. Some students are able to use loan approval as proof of funds, but its not easy and its up to the school and consular officer if they’ll accept a loan approval as proper funds.  You would need to apply for the loan now, list the school you plan to attend, get initially approved based on the credit of your co-signer, then use that initial approval to complete your acceptance to the school.

      We have loan programs available to international students studying or planning to study in the United States, with a US co-signer. The co-signer must be a US citizen or permanent resident with good credit and income history and who has lived in the US for the past two years.  You will also have to provide a valid student visa in order to finalize the loan.  After you apply and receive credit approval for you and your co-signer, your school must certify the amount of the loan. The proceeds are then disbursed directly to the school.

      The interest rate and repayment will depend on the loan option and lender you select. After you select the loan that works best for you, you will need to review the terms or contact the lender directly with your questions. The interest rate is calculated based on an index plus a margin that will add an additional percentage interest rate depending on your cosigner’s creditworthiness. Based on their creditworthiness, an additional interest rate will be added to the index which will be the total interest rate you owe and at that point you can determine whether you’d like to proceed. Every lender’s range varies so my best suggestion would be to do the loan comparison tool and review the interest rate and repayment terms.

      Click here to find the loan options available to you: http://www.internationalstudentloan.com/apply/

  4. AYANSOLA OLAWALE O. says:

    It will be so helpful and useful,especially for students with pitiable financial status both home and abroad.

  5. krishna subedi says:

    How can international student get scholarship without IELTS? How much can we get scholarship?

    • Jennifer Frankel says:

      Every scholarship is different so some may require an English language proficiency test, while others may not. You can check out InternationalScholarships.com to see what options are available.

  6. Right C3 says:

    These are the real benefits. Student loans are a mandatory requirement for almost every international student. This actually makes them more responsible and disciplined and builds confidence in them.

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