Studying in the United States is an exciting opportunity. When it comes to funding this new chapter, there are various options including scholarships, grants, and student loans.
While helpful, scholarships and grants may not cover your entire cost of attendance. If so, a private international student loan may be your next step.
To get you prepared, let’s dive into everything you need to know about student loans as an international student.
What are International Student Loans?
International student loans are a type of private student loan available to non-U.S. citizens studying in the United States. International student loans can help you cover expenses such as tuition, room and board, books, travel expenses, health insurance, and more.
Why International Student Loans?
On average, international students pay between $20,000 and $40,000 in tuition per year to study in the United States, according to the International Education Specialists. Note that this is strictly tuition and does not include any additional fees, housing, meal plan, travel expenses, insurance, phone plan, etc.
Because of this, most international students are unable to pay for college out of pocket. Even with scholarships and grants, there still tends to be a remaining balance. To cover that remaining balance, many international students opt for a private student loan.
What Types of Loans are International Students Eligible For?
As an international student, you are more than likely eligible for private international student loans. To be eligible for federal student loans, however, you must meet certain criteria.
Are International Students Eligible for Federal Student Loans?
As an international student, you are only eligible for federal student loans if you are an eligible noncitizen. An eligible noncitizen is someone who:
- Is a U.S. national, such as a citizen of American Samoa or Swains Islands
- Is a U.S. permanent resident with a permanent residence card or “green card”
- Has an Arrival-Departure Record (I-94) from the Department of Homeland Security showing any of the following statuses:
- Refugee
- Asylum granted
- Indefinite parole
- Humanitarian parole
- Cuban-Haitian entrant
- Holds T-nonimmigrant status
If you are an eligible noncitizen, you should complete the FAFSA to apply for federal student aid. Be sure to complete the FAFSA and pursue any federal aid prior to exploring private international student loans.
Are International Students Eligible for Private Student Loans?
If you are not an eligible noncitizen, and therefore ineligible for federal student loans, private international student loans will be your best option.
Most international students will be eligible for a private student loan due to the wide variety of eligibility criteria. Each individual lender will require that you meet a unique set of criteria. Whether you meet that eligibility criteria depends on how the lender chooses to evaluate borrowers.
In general, private student lenders will ask you to provide information such as:
- Proof of enrollment
- Your student visa
- Your tuition bill
- Proof of identity
Then, private student lenders will use this information in combination with your credit history to determine your eligibility. Having a U.S. citizen or permanent resident cosigner may help you secure a private student loan.
Importance of a Cosigner
Around 92% of all undergraduate student loans are cosigned. As an international student, most lenders will ask you to have a U.S. citizen or permanent resident cosigner. Having a cosigner will not only help you secure a student loan as an international student, but help you secure better interest rates and terms.
What is a Cosigner?
A cosigner is an individual who would sign onto the loan alongside you. By signing the loan with you, the cosigner takes full responsibility for the loan if you are unable to repay it. While not required, having a creditworthy cosigner can help you secure lower interest rates and better terms on your student loan.
Why Does Having a Cosigner Help?
When you borrow money from a lender, the lender evaluates you based on the level of risk you may bring to them. Lenders want to know that you’re going to pay them back. So, they typically use your credit history to evaluate your past financial performance to determine how likely you are to pay them back, and on time.
If your financial history demonstrates responsibility, you pose less risk to the lender. If your financial history demonstrates irresponsibility, you may be a riskier borrower for a lender.
As an international student, you likely won’t have a financial history in the United States. This makes you challenging to evaluate from a lender’s perspective. Having a U.S. citizen cosigner allows lenders to review their financial history, determine their responsibility, and set the terms of the loan based on that.
So, if you don’t have a financial history in the United States, but your U.S. citizen cosigner does, you can score significantly better rates and terms than if you took on the loan without the cosigner. When possible, you should pursue cosigned loan options before non-cosigned options.
Can You Get Loans Without a Cosigner?
If you don’t have a U.S. citizen cosigner, you aren’t out of luck. You can still get an international student loan without a cosigner. There are lenders that work with students just like you.
First, make sure that you meet the basic eligibility requirements of most private student lenders:
- Go to an approved school
- Come from a qualifying country
- Be enrolled at least half-time in an eligible program
- Live in the United States while attending school
- Verify your identity
- Qualify for a student visa to study in the United States
Each individual lender will have their own unique set of eligibility requirements. Starting with meeting the basics is a good first step.
Can I Get a Student Loan as an International Student with No SSN?
When it comes to private student loans, lenders typically check your credit score. In order to do so, lenders typically need your SSN. As an international student, you likely won’t have an SSN, but don’t worry. There are various lenders that don’t require SSNs.
The easiest way to get a private student loan as an international student with no SSN is to have a U.S. citizen cosigner. If you don’t have access to a cosigner, there are lenders that work with students without cosigners or SSNs.
How Much Can You Get in International Student Loans?
Typically, international student loans will cover up to the cost of attendance minus any other aid you’ve already received. This level of coverage is crucial as an international student because expenses can be higher due to travel and getting settled in your new country.
For example, let’s say you are attending a university for the 2022-2023 academic year with the following expenses:
Tuition: $50,000
Room and Board: $12,000
Campus Health Insurance: $3,000
Books and Supplied: $1,500
Miscellaneous Fees: $750
Transportation: $500
Total Expenses: $67,750
In this example, your total cost of attendance would be $67,750 for the academic year. If you received $30,000 in scholarships, your remaining balance would be $37,750. You would be eligible to borrow up to $37,750 in student loans to cover that remaining balance.
Best Student Loans for International Students
The best student loan will always be the one that works best for you. However, these are our top picks for international student loans.
International student loans without cosigner
MPOWER offers non-cosigned student loans to international students. MPOWER does not require borrowers to have a credit history or a cosigner. Instead of using your credit history to determine your eligibility, MPOWER uses information such as your future income potential.
Prodigy Finance offers non-cosigned student loans to international students. Prodigy Finance does not require borrowers to have a high credit score or a cosigner. Prodigy Finance uses information such as your credit history and future income potential to determine your eligibility.
International student loans with a cosigner
Ascent offers traditional cosigned credit-based loans for international students. With a qualifying U.S. cosigner, international students can be eligible for Ascent private student loans.
College Ave offers traditional cosigned credit-based loans for international students. In order to be eligible to borrow with College Ave, borrowers must have a Social Security Number and a U.S. citizen or permanent resident cosigner.
Earnest offers traditional cosigned credit-based loans for international students. In order to be eligible to borrow with Earnest, borrowers must apply with a creditworthy U.S. citizen or permanent resident cosigner. The borrower must also have a physical address in the United States and a Social Security Number.
Sallie Mae offers traditional cosigned credit-based loans for international students. In order to be eligible to borrow with Sallie Mae, borrowers must apply with a creditworthy U.S. citizen cosigner.
How to Apply for International Student Loans
To apply for an international student loan, you’ll need to know when you plan to enroll, how much it’s going to cost, and if you’ll have a cosigner.
When you plan to enroll. To apply for a student loan, you’ll need to know where you’re going to school and how much it will cost. Some private lenders have restrictions on what schools they work with and how much they allow you to borrow.
How much it’s going to cost. To apply for a student loan, you’ll need to let the lender know how much you want to borrow. Your school will provide you with the overall cost of attendance, but be sure to factor in additional costs such as travel expenses, transportation, health insurance, and more.
If you’ll have a cosigner. Before applying for a student loan, ask around to see if you can secure a cosigner. If you can, make sure to know all of the individual’s information so you can input it into the lender’s application.
Should I Take Out An International Student Loan?
Whether you decide to fund your education with a private international student loan is ultimately up to you. Before accepting any loan, however, you should exhaust all scholarship and grant opportunities first.
If, after accepting scholarships and grants, you are unable to pay your remaining balance out of pocket, a private student loan may be the next best option. When you’re ready, know that Sparrow has your back the whole way.
Final Thoughts from the Nest
Whether you decide to take out a student loan to fund your international education depends on your unique circumstances. Regardless, know that Sparrow is here to help.
When you’re ready to start the student loan process, start the Sparrow application. Sparrow’s student loan search and comparison process allows you to see all of your student loan options in one place. We’ll even help guide you to the best loan option so you can be confident in your lending decision.
Sparrow’s goal is to give you the tools and confidence you need to improve your finances. Many or all of the products featured here are from our partners who compensate us. This may influence which products we write about and where and how the product appears on a page. However, this does not influence our evaluations. Our opinions are our own. While we make an effort to include the best deals available to the general public, we make no warranty that such information represents all available products.