Financial aid is usually the first or second question we get here at Stoodnt about college admissions in the United States. US News & World Report had some good tips about financial aid for international students:
Studying in the U.S. isn’t cheap, and it’s usually even more expensive if you’re an international student.
Most international students, including F-1 visa holders, aren’t eligible for student loans from the U.S. government. But there are a limited number of other loan options for prospective and current international undergraduates.
Some U.S. schools offer generous financial aid packages to international undergraduate students. Among the 50 colleges and universities that gave the most financial aid to international students for the 2015-2016 school year, the average award size was $51, 164, according to U.S. News data.
But not every international student gets a sizable aid package. To help meet remaining financial need, some schools, such as St. Olaf College in Minnesota, offer loans.
“We have a small, fixed amount that we let international students borrow, ” says Carly Eichhorst, director of financial aid at the college. “We don’t let them borrow more than that.”
St. Olaf’s international undergrads can borrow up to $4, 000 per year during their four years of study. The current interest rate is a fixed 5 percent and the repayment term is five years. A co-signer is not required, says Eichhorst. A co-signer is someone who agrees to take on the debt if the borrower doesn’t pay it back.
For the 2016-2017 academic year, St. Olaf lent money to 111 students, or about half of its international student population, according to Eichhorst. The average amount borrowed was $3, 185.
If a student’s school doesn’t offer loans, which may often be the case, there are a few other options. Some companies, such as Citizens Bank, will give student loans to non-U.S. citizens if they have a co-signer who is a U.S. citizen or permanent resident – a tough requirement for many foreign students.
International students might have siblings or cousins living in the U.S. who are willing to co-sign a student loan, says Eichhorst.
Some schools compile a list of recommended lenders as a resource for their international students, says David Sheridan, director of financial aid at Columbia University’s School of International and Public Affairs. The recommended lenders on Columbia’s list for 2016-2017 for undergraduates all require co-signers.
There are a handful of companies that lend to international students and don’t require a co-signer, such as MPOWER Financing. The District of Columbia-based company gives loans to both undergraduate and graduate students, though most borrowers are grad students.
However, financial aid experts say that before turning to loans, international students should look into all available scholarships and grants – both at home and in the U.S. – since these types of awards don’t have to be paid back like loans do. One place to start is the EducationUSA website, which has a database of private and college-based financial aid opportunities.
For international students who are considering loans, here are some tips.
• Start researching early: Sheridan says students should begin looking into loan options even before they’ve even been admitted to a U.S. college or university, “just so they know what the realistic options for them would be.”
• Ask lots of questions: Smadja suggests students look into things like whether a lender’s interest rates are fixed or variable; the length of the repayment term; whether there is a penalty for prepayment, or paying back the loan early; and what happens if a student has trouble making a payment one month.
• Don’t wait too long to apply for a loan after being admitted: Securing loan approval sooner rather than later will help students complete the I-20 process in a timely manner, says Sheridan. Students receive a Form I-20, which is needed to obtain a visa, from their college after proving they can afford to study in the U.S.
When it comes to loans for international students, “there are challenges, ” Sheridan says, “but there are possibilities.”