In the United States, a cosigner is someone who will become responsible for loan payments if the borrower is unable to repay them. It is added security for lenders and makes them more likely to approve you for a student loan.
But what if you are looking for an international student loan but don’t have a cosigner? Fortunately, there are both federal and private international student loans available without a cosigner.
Read on to see those options, other ways to pay for college without a cosigner, how to find a cosigner, and more.
Federal Student Loans for International Students Without Cosigners
All federal student loans do not require (or accept) cosigners.
The bigger problem that international students face is meeting the eligibility requirements for federal loans.
Only qualified noncitizens are eligible for federal student loans, including:
- U.S. nationals (includes natives of American Samoa or Swains Island).
- U.S. permanent residents with a green card.
Those who have an Arrival-Departure Record (I-94) from U.S. Citizen and Immigration Services (USCIS) showing one of the following statuses: Refugee, Asylum Granted, Cuban-Haitian Entrant, Conditional Entrant (issued before April 1, 1980), or Parolee.
Those who hold a T nonimmigrant status or whose parent holds a T-1 nonimmigrant status.
Those who are a “battered immigrant-qualified alien” or the child of one.
You can apply for federal student loans by filling out the FAFSA. This will also determine your eligibility for other forms of federal financial aid such as scholarships, grants, and work-study programs.
Below are the types of federal student loans you may be eligible for. Note that all federal student loans have origination fees. You can see current rates and fees here.
1) Direct Subsidized Loans
These loans provide students with flexible repayment terms along with low, fixed interest rates. These loans are provided to students based on their financial need, and the government pays the accrued interest while students are in school and during the grace period (6 month period after leaving school when payments aren’t yet due).
2) Direct Unsubsidized Loans
Contrary to the subsidized loans, Direct Unsubsidized Loans are available for all students regardless of financial need. The government does not, however, pay accrued interest while students are in school or during any other time. These loans do have the same low interest and many repayment options, though.
3) Direct PLUS Loans
These loans are available to graduate students (Grad PLUS Loans) and parents of students (Parent PLUS Loans). Interest rates are higher than the other two types of loans but there are multiple repayment plans available.
Private Student Loans for International Students Without Cosigners
f you are ineligible for federal student loans, don’t be discouraged!
There are also private student loans for international students that don’t require a cosigner.
It’s important to note that private student loans aren’t eligible for federal student loan benefits such as income-driven repayment plans and student loan forgiveness.
Here are three online lenders designed specifically for international students without cosigners:
1) Stilt
Stilt’s loans are specifically designed for international students and others who may have difficulty obtaining a private or federal loan in the US. Stilt lends to immigrants, including international students and DACA holders, who can’t get a cosigner.
Stilt’s loans have competitive interest rates starting at 7.99% and the loan process is very quick—you can get a decision within 24 hours after completing an application. The funds can be in your account as quickly as 1 business day after the promissory note is signed.
Stilt doesn’t partner with universities, so you are eligible to apply irrespective of the university you attend. Stilt is also the only option if you want to refinance your international student loan without a cosigner.
Another benefit of Stilt’s loans is that they can help you build your credit score.
2) MPOWER
Like Stilt, MPOWER Financing also focuses on international students. To make up for the lack of cosigners, however, MPOWER tends to give loans to students they feel have high earning potential.
MPOWER partners with universities and provides loans only for a few majors. To be qualify for MPOWER, you should be attending an eligible school supported by MPOWER and be in the last 2 years of your education.
Interest rates start at 11.99% and the loans have repayment periods up to 10 years. Because of this, it can be difficult for undergraduate students and students at lower-tier universities to qualify.
On average, it takes 3 weeks for an end-to-end process with MPOWER, and the funds are disbursed directly to the school.
3) Prodigy Finance
Another international student loan company is Prodigy Finance. They have seen great success and hope to grow tremendously in the future. The downside, though, is that they have tough qualification guidelines.
The list of partner universities and majors is limited. Prodigy is focused on loans to international students who attend Master’s programs. They only offer loans to students at the highest-ranked universities and even restrict the areas of study that they will cover.
The loans are originated from a U.K.-based entity, and the repayments are not reported to credit bureaus in the U.S., so they can’t help build your credit score.
Other Financial Aid Options for International Students
For many international students, getting private student loans (like the ones above) ends up being the only option that they have. In some cases, though, you may be eligible for other financial aid options.
Here are two additional ways for international students to get financial aid outside of student loans:
Private & Academic Scholarships
A great option for students of all backgrounds is scholarships. There are scholarships for almost every type of person and skill, and some are complete luck!
A simple Google search will pull up hundreds of scholarships, and the more you apply for, the better chance you have at getting money.
Even if you get a great loan, scholarships offer a huge advantage: you will never have to repay them. No matter the size, scholarships can help all students, regardless of the method they use to pay their tuition.
Family & Personal Savings
When it comes to college tuition, paying what you can upfront can save you a lot in the long run.
It may require some sacrifice, but any payments that you can make on your own throughout your time in college will reduce the amount of debt you have to take on.
Why Do International Students Often Need Cosigners?
After reading about the difficulty of finding a cosigner above, you may be wondering whether or not you need one? Can you get a loan without a cosigner?
There are many criteria for obtaining a student loan, whether it is a federal loan or a private loan, many of which are more difficult for international students to meet.
Low/no credit score & credit history
As with a cosigner, an international student loan will require you to show an excellent credit score and a long credit history in the US.
This is obviously very difficult for international students, as college is often their first time in the US for an extended period of time.
Even if you began building credit in college, it would likely not have enough time to grow during your time there that you would be eligible for an international private student loan without a cosigner.
Students have very little income
Most students don’t have substantial income during college because they aren’t yet eligible for high-paying jobs and because they don’t have time to work that much while taking classes. Because of this, most college students don’t meet the income requirements for private lenders.
Very high-interest rates
If you are barely able to meet the requirements above but have no cosigner, the lender will make up for this insecurity by charging you a much higher interest rate.
Although it’s great to be able to qualify on your own, a high interest rate means your loan can be very expensive. A qualified cosigner can help you get a lower rate.
How Can an International Student Find a Loan Cosigner?
After reading the beginning of this article, you may have come to the conclusion that it is both helpful and very difficult to find someone to obtain a cosigned loan.
Below you will find the most common ways to find an international student loan cosigner in the US:
Have friends or family cosign
If you are planning to attend a university in the United States, it might be because you have close family or friends living there.
If this is the case, and they are a US citizen or permanent resident with good credit, they may be willing to sign for your loan.
Family and friends are the most commonly used cosigners in the US, for both permanent residents and international students.
Check with university alumni associations
Some universities have programs in place to help international students with the dilemma of getting a loan with a cosigner.
Alumni who may have been in your shoes before and are now established in the US offer to cosign private loans for students who show commitment and academic promise.
It is worth it to check for this option when choosing your university.
Use an online loan cosigner matchup
In this day and age, whether it’s a home, book, or significant other, you can find almost anything online. This also holds true for loan cosigners.
You can certainly do your search on any social media platform, but there are also websites like Cosigner Finder that will help you find a willing and able international student loan cosigner.
The internet can be a great resource—but be careful! Do not give any personal information to an untrusted party. Also, note that websites like this may charge additional fees.
Requirements for Cosigners on International Student Loans
While the concept is simple, finding a loan cosigner can be very difficult, especially for an international student; not just anyone can cosign a loan.
A qualified cosigner can be difficult to find because private lenders will require that they meet certain criteria. The most common and important requirements are that your cosigner:
1) Have a Good Credit Score and Credit History
The point of having a cosigner is to provide additional security on the loan, so the cosigner must prove that they will make the payments if need be. The proof that lenders look to is credit history and credit score.
2) Be a US Citizen or Permanent Resident
The second thing you need in an international student loan cosigner is US citizenship, which is usually the most challenging criteria for international students.
3) Have a Stable Source of Income
Lastly, your cosigner must be able to show a stable source of good income. Lenders will usually ask for recent pay stubs to prove that the cosigner will be able to make payments.
4) Be Willing to Cosign a Loan on Your Behalf
The last element of an eligible cosigner is much simpler, yet can still add difficulty to your search. Even if you have found a perfect cosigner—who meets the criteria above—he or she may not be willing to sign on your behalf.
Cosigners are taking a risk because their credit can be hurt if the borrower fails to make the necessary payments on the loan. Many people are not willing to take this risk, even if they are a close friend.
Bottom Line on International Student Loans Without Cosigners
As an international student, loan options will be hard to come by in the U.S., especially if you don’t have a cosigner. But that doesn’t mean that you have no options. Armed with the information above, you should be able to secure a loan and make the most of your education in the U.S.!
If you are considering applying for a personal loan, just follow these 3 simple steps.
Apply
Apply online for the loan amount you need. Submit the required documentation and provide your best possible application. Stronger applications get better loan offers.
Accept
If your application meets the eligibility criteria, the lender will contact you with regard to your application. Provide any additional information if required. Soon you’ll have your loan offer. Some lenders send a promissory note with your loan offer. Sign and return that note if you wish to accept the loan offer.
Repay
The loan then gets disbursed into your U.S. bank account within a reasonable number of days (some lenders will be as quick as 2-3 business days). Now you need to set up your repayment method. You can choose an autopay method online to help you pay on time every month.