A Complete Guide To International Student Loans In The USA

Embarking on a journey to study in the USA comes with challenges. Especially if you are an international student, we hear you! As the word itself says, "I'm Possible," you can fulfil your educational aspirations with student loans for international students in the USA. 

Navigating the landscape of international student loans in USA is complex. However, you can say goodbye to your woes with this comprehensive guide to international student loans in the United States. We will give you insights into the types of education loans in USA for international students, how the loans work, and beyond. ‍

What Are International Student Loans in USA?

You might have a difficult time getting to the answer of how to choose a student loan for your education, but we have got you covered. International student loans in USA are a type of private loan available for non-US citizens. You can apply for a loan if you want to pay for tuition, books, room and board, travel expenses, books, health insurance, etc., when you are studying in the United States. ‍

Who Can Apply for International Student Loans in USA?

Lenders evaluate specific factors when offering student loans for international students in USA. Based on these criteria, they determine the eligibility of applicants for a student loan in the United States. Let's explore these criteria in detail:

1. Strong grades and academic performance

2. A Job oriented professional course

3. Secured position in a university in the USA

4. Above 18 years of age 

Types of International Student Loans in USA

Usually, Nearly 19 million international students study in the United States, and they pay approximately $40,000 for tuition fees in the United States. Many pay for college out of their pockets, scholarships, or grants. Yet, they struggle to cover their lifestyle and other study-related expenses. Once you delve into the types of international student loans in USA, you can find your way!

1. Federal Loans 

Federal student loans for international students in USA can be comparatively more relaxed. The interest rates are fixed, and the payback period can be extended. This type of international student loan in USA offers access to loan forgiveness programs. However, getting a federal loan as a student loan in USA for international students can be complex.

Federal Loan: Eligibility Criteria  

Federal student loans in USA for international students are available for non-US citizens. Of course, you need to be someone with: 

1. A resident cosigner 

2. A green card 

While meeting the standards may be a challenge, you can still land an education loan in USA for international students. With many international student loans in USA from top lenders like Lorien Finance, living your dreams has become more feasible.

2. Private Loans 

A private international student loan does not have a loan forgiveness program, unlike federal loans. The eligibility criteria, interest rates, and other guidelines depend on the lender. For this reason, the interest rates for international student loans in USA are comparatively high and widely available. 

Private Loan: Eligibility Criteria

If you are not eligible for a federal loan, a private loan for international students in USA is your last resort. Every lender has a set of different criteria for international student loans in USA, and you need to provide information for the following: 

1. Student visa 

2. Tuition bill 

3. Proof of enrollment 

4. Proof of identity    

5. Credit history 

Some students are ineligible for federal loans even after having a cosigner. If you face the same, your road to a private international student loan in USA can be stress-free.

Documents Required for International Student Loans in the USA 

When applying for student loans as an international student in USA, you will need to gather various documents. Specific requirements vary among lenders, so we have a list of common documents you might need: 

1. Loan application form 

2. Amount estimation based on the I-20 

3. Certificates and mark sheets (original) 

4. Certificate of qualification exams like TOEFL or IELTS 

5. University offer letter 

6. Residential proof of the applicant and guarantor 

7. Identity proofs like driving licenses, national identity cards, etc.

8. Guarantor's income proof 

9. Copy of passport 

10. Details of the guarantor's assets and liabilities

How do Student Loans for International Students in the USA Work? 

Don't know where to get started with a student loan in USA for international students? We have broken down the complex process into four simple steps to help you understand it better! Here's how international student loans in USA work: 

Step 1: Calculate Your Loan Amount

This step starts before you get the admission letter! So, pull out your calculators and calculate all your expenses, including the college fees, examination fees, lab charges, library membership fees, travel costs, living, books, equipment, etc. 

Make sure your calculations are as precise as possible since the amount of the education loan in USA for international students affects the interest rates you will pay. 

Step 2: Compare the Lenders 

Collect information about as many lenders as you can find. Be it banks or financial services, include them on your list. You will have many options for loans for international students in USA, so compare them side by side. 

You can also compare the lenders for international student loans in USA depending on their requirements, eligibility criteria, interest rates, flexibility of repayment, etc. 

Step 3: Apply for an Education Loan

After finding the perfect lender for yourself, now is the time to apply for an international student loan in USA. Find out what documents are required for the loan application. Get all the documents and fill out the application form provided by the lender. 

After verifying your documents, your international student loan in USA will be approved if everything is all right. However, the disbursement for an international student loan in USA will only happen after you have gotten your I-20 form from the university that has all the information about your admission, course, department, and expenditure. 

Step 4: Repayment

The last phase of international student loans in USA is repayment. For a student loan in USA for international students, the repayment process begins after the moratorium period or the EMI holiday. 

The repayment of an international student loan in USA might even start when the student gets employed. However, a straightforward interest for an education loan is charged during the study period.

Can Indian Students Get International Student Loans in the USA? 

Initially, you might have difficulty finding banks that give loans to international students, but don't worry. The trick lies in finding the right lender and program! You can make a list of the best student loan providers and compare the interest rates & eligibility criteria. SBI, HDFC, AXIS, PNB, and others can help you get an approved loan to study in the USA. 

Besides traditional banks, financial services like Lorien Finance can also be great lenders. Many US banks also provide education loans for international students, making their dreams more accessible. For further information, you should consider the various loan categories. 

Categories for Student Loans in the USA for International Students

International student loans in USA are available in two categories, so let's take a look below and find out everything you need to know! 

1. Student Loan with Collateral 

An international student loan in USA with collateral is where the borrower promises an asset, such as a house or a car, as a form of security for the loan. Let's give you a scenario for better understanding: if the borrower fails to repay the student loan in USA for international students, the lender has the right to take ownership of the sworn asset to recover the money.

2. Student Loan without Collateral 

Also known as an unsecured or non-collateral loan, this category does not need the borrower to provide any asset as security. The international student loan in USA is based on the borrower's creditworthiness and ability to repay the loan rather than any specific asset.

What is the Difference between Collateral and Non-Collateral Loans? 

As the name suggests, collateral student loans in the United States are given based on the collateral. It can be any movable or immovable asset. A bank representative evaluates the collateral you are keeping against the loan. Then, the international student loan in USA is provided based on its value. On the other hand, an education loan in USA for international students without keeping any collateral is called a non-collateral loan. This loan, however, needs a signature from a parent or a third party, like a financial service. 

What is Accepted as Collateral for International Student Loans in the USA? 

Various types of assets can be used as collateral for international student loans in the USA. Here are some examples to help you understand the options better:

Collateral Assets like: 

• Bonds
• Shares
• FDs
• Other Liquid Assets

Immovable Assets Like:

• House
• Property Plots
• Commercial Properties, etc.
  

Other Types of Collaterals:

• Mutual Funds
• Gold
• Bank Deposits

Tips for Applying for International Student Loans in USA

When applying for a student loan in USA for international students, keep the following things in mind:

1. The Amount of Student Loan 

To apply for an international student loan in USA, let your lender know how much you want to borrow. You can ask the school about the tuition fees and additional costs such as health insurance, travel expenses, etc.

2. The Time of Enrolment 

To apply for an international student loan in USA, you need to know where you are going to study and how much it will cost. Some private lenders come with certain restrictions, student limits and how much you can borrow.

3. Find a Cosigner 

Before applying for a loan for international students in USA, you can ask around and find a cosigner. Always make sure to put valid information about the individual in the lender's application. 

Now that you know all about the basics of international student loans in the United States, you can totally ace it! Just beware of the loan scams because they are everywhere. You can memorize the best tips about how to spot and avoid student loans and unlock a smooth loan process. Of course, understanding the process and knowing what to expect while applying for education loans in the USA will make things easier for you. So we hope this guide will help you make the right decisions and take on this journey like a pro!