Understanding Interest Rates for International Student Loans
December 13th, 2012 by Jennifer Frankel
It comes as no surprise that international students are interested in, well, interest. After all, interest – broadly defined as the money above and beyond the principal (original amount of the loan) paid to the lender in exchange for borrowing money – represents a significant financial burden for any kind of loan. That burden, however, can be quite different for international students than it is for domestic students.
Varying international student loan interest rates are one of the key reasons for this. Indeed, while the interest rates on federal student loans are fixed by law, such loans are usually inaccessible to foreign students studying abroad in the United States. Fortunately, in addition to self-financing through personal savings and scholarships, international students can turn to international student loans when financing the goal of higher education. Unlike federal student loans, however, the international student loan interest rates are not fixed. Instead, a number of factors, when taken together, determine the interest rate on a private loan. Read the rest of this entry »