By: Yara Zakharia, Esq.
International students pursue higher education overseas in the hopes that it will open the door to professional advancement, better career opportunities and a greater understanding and appreciation of the world. Financing a college education in the United States, however, is a challenging undertaking for international students since it requires a substantial personal and pecuniary investment. Sources of international student loans available to international students at the undergraduate level are extremely competitive and limited.
Although, generally-speaking, international students are not eligible for federal student aid, eligible non-citizens can receive financial aid from the U.S. government. To be eligible, international students must meet the following requirement:
They must be in the U.S. for a reason other than a temporary purpose with the intention of becoming a citizen or lawful permanent resident.
Private international student loans are available to non-U.S. students on the same terms as U.S. students. As is the case for many U.S. students, most international students will need to rely on loans to finance at least a portion of their U.S. education. What follows are some of the most typical provisions of international student loans, with which international students should familiarize themselves:
1. Requirement of a U.S. co-signer:
International student loans require a co-signer who is either a U.S. citizen or a permanent resident. The co-signer must have a good employment history (or other income history if the co-signer does not work) and a good credit history. The co-signer also must have resided in the United States for the past two years.
2. Funds paid directly to the international students:
The international student loans are not paid to the school, but to the international students. This means that the borrowers can use the funds for living expenses. However, international students should, for their own sake, ensure that the funds are used responsibly, namely to cover the costs of books, tuition, room and board, and health insurance.
3. Application fees:
There are no application fees for international student loans. International students will only have to pay an origination fee upon receipt of the loan, but that amount is included in the total loan amount, and does not have to be paid ahead of time.
4. Online application:
The application for international student loans can be completed online or by phone. International students will be immediately notified if they are conditionally approved for the international student loans. To receive the funds, they will then have to sign a promissory note and submit proof of enrollment and their immigration status.
5. Interest rates:
International student loan interest rates vary. The better the credit history of the international student's co-signer, the more attractive the interest rate will be on their student loan.
6. Repayment:
International students can defer repayment of their international student loans while they are enrolled full-time, and for six months after they complete their studies. International students will then have up to 20 years to repay loan, with a payment due each month. If they encounter unforeseen circumstances that hinder their ability to repay their student loans for a short period of time, international students can apply for hardship extensions.
International students will find a number of different international student loan programs at their disposal. Resources for international student loans include the following:
- TERI international student loans
- International Student Loan (www.internationalstudentloan.com)
- International Student (www.internationalstudent.com)
- Sallie Mae International (www.salliemae.com)
- Study Abroad Loans (www.studyabroadloans.com)
- EAS or Education Association Services (www.easnetwork.com)
- IEFA or International Education Financial Aid (www.iefa.org)
In conclusion, considering the small world that we live in, the importance of an international education is gaining ground. International students seeking to study in the U.S. will find that it is an expensive engagement. The cost of tuition, room and board at an undergraduate institution ranges from $15,000 to $40,000 per year; it is even higher at a graduate school. Therefore, international student loans can help international students overcome the financial hurdle by funding their education in the United States.
