When to Apply for an International Student Loan
Although the idea of how to apply for international student loans may seem daunting there is an easy formula of how to break it all down to make the process as easy as possible.
Now that you've picked your study abroad destination, begun all the paperwork, you have to think about how to fund your time abroad. The process of how to apply for international student loans can differ from student to student and is dependent on the three very important things: the budgeting & planning process, choosing the right loan options, following the timeline, and for US students the FAFSA (Free Application for Federal Student Aid) application.
Budgeting and Planning
One of the most important steps in deciding on a student loan for international students is becoming fully informed regarding everything that is needed in a timely fashion. If you've already taken care of the first step, which is choosing your international program, then you are on the right track. Once you have chosen your program it is important to find out the total cost for participation. If you are studying abroad through a university- sponsored program or a US-based institution they often times provide students with this type of breakdown. However, if you have chosen an independent program, or you are enrolling directly into a non-US university, you will have to take the time to collect this information from the proper sources. The total cost of a program may sometimes include transportation but it can also be left out. It is also good to know how much money you have saved or will need to save to fund miscellaneous costs such as travel, recreation, and leisure.
Another important aspect of the pre-planning process for international student loans is to be aware that most international student loans will require a cosigner. A cosigner is someone who has a good credit history who agrees to sign the contract stating that if for whatever reason you are unable to pay the responsibility of your debt the responsibility will fall on their shoulders. Being that the debt can be easily transferable this is a big responsibility. Often times cosigners tend to be family members, such as parents or siblings, but it is important to take the time to ensure that you have someone who qualifies and is willing to be a cosigner. Almost all international students will be required to find a cosigner who is a US citizen or permanent resident who has resided in the US for the past two years. While not all US students need a cosigner, it's a good idea to improve the likelihood of approval and to ensure a good interest rate. Students at select schools and in certain cases may be eligible for a no cosigner loan. See if you're eligible to apply for an international student loan without a cosigner.
With these numbers in mind you can begin your search for appropriate student loans for international students.
What are your International Student Loan Options?
Having figured out how much the total cost of your program will be, how much you can afford out of pocket, and having selected your cosigner it is time to break down your loan options. When it comes to choosing the best option in order to apply for international student loans, students have 3 basic options: federal, study abroad or private student loans. Two important facts, regardless of which option you go with is that not all lenders work with all international students and not all lenders work with all schools.
Federal Financial Aid for US Students
The best choice for US students, those traveling for only a semester or year or those planning to enroll directly in an international institution and pursue a complete career, is to try to apply for and receive federal loans. Unfortunately non-US students are ineligible for federal financial aid. But for US students, federal loans should always be the first option because they offer both subsidized and unsubsidized loans, a 6 month grace period if student falls beneath halftime enrollment, fixed interest rates, grace period while student is still enrolled, deferment options, extended repayment types, and the possibility to receive tax benefits of up to 2500 without itemizing. Federal loans often time come as Stafford Subsidized or Unsubsidized and Parent Plus Loans. The difference between a subsidized and unsubsidized loan is that with a subsidized loan the government is paying your incurred interest during the duration of your student career, whereas with an unsubsidized loan interest charges begin automatically. Parent Plus Loans are federal loans that are geared towards parents so that the responsibility is fully on their shoulder and not on the student's. There is the possibility that a student can be offered one, two, or all three of the above mentioned. The FAFSA application is not required for private loans however for specific study abroad loans it is often requested.
Private Student Loans for International Students and US Students
The second best option, for both US and international students, is choosing to take out a study abroad loan (US students abroad) or an international student loan (non-US students studying in the US). The benefit of going with this type of student loan for international students and study abroad students is that they can borrow up to the total cost of attendance minus any other financial aid, get competitive rates, complete an easy online application, and get initial approval within weeks. Depending on the lender, many students are given a 6 month grace period after graduation if they have a loan that requires a cosigner and their cosigner has very good credit history. The best part is that it is approved by thousands of schools and you can find an extensive list on our Eligible School List. If your school is listed here, then you are eligible for our student loans. You'll be able to use our comparison tool which will allow you to easily find information on lenders, the schools that they work with, and then you can begin your application online.
Student Loan Application Timeline
As previously stated, US students studying abroad or choosing to enroll directly in an international university will want to first apply for the FAFSA. The federal deadline normally falls at the end of June, however often times universities and states provide their own deadlines in order to award separate university and state aid - sometimes it can be as early as February so be sure to double check!
After US students have applied for their federal aid, they still may need financial help. International students and study abroad students can both apply for private student loans to help them cover the gap. For both study abroad loans or private international student loans it is recommended that students apply at least 6 weeks before they want their funds disbursed.
For all students who plan to travel abroad one of the most important things is to be aware of enrollment dates and deadlines for your particular school. For US students who are traveling through a university sponsored program this often falls within the standard university timeline. However, for those who are directly enrolling in a university or are not traveling by a school sponsored program the deadlines and dates may vary drastically and is something to be aware of.
Regarding disbursement of funds, US students should aware that federal funds are not available to students any earlier than 30 days before the school's start date. However there are cases where a study abroad program begins before your school's actual start date so this is something to be mindful about. For internationals students who come to study in the U.S. be conscious that you normally do not receive funds until you have arrived at the school.
In order to successfully apply for international student loans in an efficient and timely fashion, the preplanning process is the most important. Budgeting your costs, finding a qualified cosigner, and being aware of the timeline of your program and loan application will ensure that your financial situation will be organized for your take off and arrival.
International Financial Aid Resources center
