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The Best International Student Loans of 2021
Congratulations — you’ve been accepted to your dream school in the U.S. But now you may be wondering, how am I going to pay for my education? Federal loans are available to some students studying abroad in America, but not all. If you don’t qualify, you may still be able to get a private international student loan to cover the full cost of your education, but you might need a cosigner. To help you understand your options, here’s a comprehensive guide on student loans for international students. We compared the best international student loans by reviewing rates, perks, transparency, loan amounts and fees for every major international student loan provider.
The 5 best international student loans of 2021
- Best for Masters Education: Prodigy Finance
- Best Not-For-Profit: MPower Financing
- Best for Borrowers With a Cosigner: Citizens Bank
- Best for Undergraduate Borrowers: Earnest
The best international student loans at a glance
|Lender||Loan Amount||APR||Terms||Key Benefits|
|Prodigy Finance||$15,000–80% cost of attendance||Varies||7 –20 years||No cosigner requirement|
|MPower Financing||$2,001–$50,000||up to 7.52% fixed||10 years||No cosigner requirement|
|Citizens Bank||$1,000–$150,000||4.18%–10.83% fixed; 1.16%–10.25% variable||5–15 years||Competitive rates|
|Earnest||100% of costs||as low as 3.34% fixed; as low as 1.04% variable||5–20 years||Long grace period|
What is an international student loan?
International students going to college in the U.S. typically don’t qualify for federal student loans, unless they’re an eligible noncitizen or have a green card. But they can still get international student loans, which are private loans for tuition and other education-related expenses like books and room and board. Usually, you need a cosigner who’s a U.S. citizen or resident to qualify for one, but some lenders may be willing to work with you if you can’t find a cosigner.
How international student loans work
The student loan process can be somewhat difficult and confusing when you’re an international student. Many lenders require you to have a visa and be enrolled in school before you apply for a student loan. To get a visa, you’ll need Form I-20, which comes from your college and proves you’re enrolled in its program. However, many colleges won’t give out this form until you show that you can afford tuition, which you may not be able to do without a loan.
Some private lenders offer a way around these requirements by giving borrowers conditional approval letters. Students may be able to satisfy the school’s proof of funds required with the letter and obtain the form they need to secure a visa. But because this process can be challenging, it’s important to start as early as possible.
To qualify for a loan, you’ll need to be enrolled in school at least half-time. Some lenders only work with certain schools, so you’ll need to make sure your college or university is eligible. You may also need a cosigner or a student visa to qualify for a loan with certain lenders.
Most private lenders determine your international student loan’s APR by looking at your credit score and financial background, although some may take alternative data like your future earning potential into account. So if you don’t have a credit history in the States, you may need a cosigner to get a good interest rate.
Private lenders usually offer two different types of APRs — variable and fixed. Variable APRs adjust periodically based on market conditions, while fixed rates stay the same over the life of your loan. Variable-rate loans usually start out cheaper than fixed-rate loans but may end up costing you more in the long run if interest rates rise.
Most lenders require international students to have a cosigner with good credit and a stable income who is a U.S. citizen or permanent resident. However, if you can’t find a cosigner that meets those requirements, you may still be able to get a loan. Some lenders like MPower Financing don’t require borrowers to have a cosigner or credit history to qualify for an international student loan. Instead, it determines your eligibility for a loan by looking at your future earnings potential instead of your current financial situation. However, you may get charged a higher interest rate if you don’t have a cosigner.
How to choose the best international student loan for you
- Find a cosigner or research alternatives. A student loan for international students usually requires a cosigner, so ask your family members and friends who live in the U.S. if they’d be willing to cosign your loan for you. If you can’t find a cosigner, do some research to see which lenders are willing to work with borrowers without cosigners.
- Shop around to find the best rates. Getting quotes from several different lenders will help you compare rates and fees and get the best deal possible.
- Compare loan amounts. Some lenders allow you to finance the total cost of your education while others place limits on how much you can borrow. Figure out how much money you need to fund your education and choose a lender that will allow you to take out a loan that size.
- Compare other loan features. Although rates and fees are important, they aren’t the only factors you should consider when choosing a student loan. Other important features you should compare include repayment plans, loan terms and payment assistance options. If you’re going to use your student loan as proof of funds, you should also make sure your lender will provide you with a conditional approval letter. Additionally, because the international student loan process can be challenging, make sure the lender you choose has a reputation for providing good customer service.
We welcome your feedback on this article and would love to hear about your experience with the international student loans we recommend. Contact us at firstname.lastname@example.org with comments or questions.