I was wondering about loans offered in US for international students. I’ve read about it but that was little help. What I’m clear about is that I will need a co-signer, who would probably be my aunt. I have a few questions which probably sound stupid but I’d appreciate it if you answered.
What’s the limit?
Minimum rate of interest…?
When do I start repaying?
What if I do not have a job after graduation?
Any help would be appreciated.
P.S I am a sophomore but I’d like to be prepared early. I am the first child and my sister will start college the same year that I will be done with it. My parents and I are currently discussing the possible options regarding paying for college. Also if you have any idea of scholarships for international students that are not university specific, then please do share.
For a private loan, the loan terms will depend on the lender and the creditworthiness of the borrower/co-signer, among other things. I don’t think they will care if you don’t have a job after graduation; they will expect payments on the loan as per the loan agreement.
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will need a co-signer, who would probably be my aunt. I have a few questions which probably sound stupid but I’d appreciate it if you answered.
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That is a dangerous risk for your aunt. Are you sure she’ll cosign? Does she realize how much she’d be responsible for if you can’t pay it back?
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What's the limit? - depends on the school's cost and your co-signer
Minimum rate of interest...? - Don't know what it will be then
When do I start repaying? - After you graduate
What if I do not have a job after graduation? - You'll still be expected to pay. If you can't pay, they'll go after your aunt. (That's why most parents and relatives will NOT cosign)
This is true for U.S. federally funded student college loans. It is NOT necessarily true for private loans. Your aunt would need to check the provisions of the loan she takes. Some private loans begin payment when they are disbursed…sort of like a car loan. You get the money and you immediately start paying it back.
@thumper1@mom2collegekids Actually, I asked about it so I’d know the options that I have. We haven’t really discussed any of this with her. I thought it would be better to have the facts before I talked to her about it. Thank you for answering!
Please look carefully at your possible college lists. Unless your aunt is extremely wealthy…and I mean VERY wealthy, please do not ask her to cosign college loans for more than $5000 a year…or so.
It sounds like you need a lot of loans to attend college in this country. Is that correct?
Your parents should have asked your aunt if she’d consider cosigning loans for you (and presumably your sister) before they mentioned the possibility to you. A $5k/year loan sounds small, but it will be $20k at the end of 4 years; $40k if she cosigns for your sister too. And that won’t be enough to cover the travel expenses for an international student. That’s a lot of money to be on the hook for and it will affect her credit rating. Unless she’s very wealthy, and I’m assuming that she’s not if she has to cosign a loan instead of loaning the money to you directly, then I wouldn’t ask her to do that. Attend a college that your parents can afford.
My understanding is that the ONLY loan where you are safe from not paying interest during college is a subsidized Stafford loan.
I know of no other loan program or product that does not accrue interest the moment the loan is disbursed. Sure you can defer paying until graduation but that does not mean the principal amount has not “snowballed” with all the interest that accrued on that amount during your time in college.
I would be very interested if people could point me to a program where interest does not accrue during college years.
This student is an international student. He is not eligible for federally funded U.S. loans.
I agree…interest will accrue on these private cosigned loans…AND it is very possible that repayment will start when the loans are disbursed with no grace period until or after college graduation.
Good point, @MassDaD68. So even if OP’s aunt only borrowed $5k/year for both kids, she’d be on the hook for way more than $40k after they both graduate.
@mom2collegekids My aunt is a US Citizen, she’s been living there for over 15 years now. @thumper1 We would be able to arrange about 100,000 dollars and with the colleges I will probably apply to, I don’t think we’d have to take out that much in loans. @austinmshauri Actually, borrowing money from her is a possibility. I’ll know more once my dad talks to her. Like I said before, we’re just looking at our options right now.
All loans, even Stafford loans, start accruing interest at disbursement, but the government pays the interest on the subsidized portion of the Stafford loans and on Perkins loans while the student is in school and for a short grace period. For Plus loans, the parent can apply for a deferment on making payments will the student is in school. Many parents chose to pay the interest as it accrues so that the amount owed at graduation is that same as what was borrowed.
Good info @twoinanddone but this is an international student who is not eligible for U.S. federally funded loans…at all.
The provisions of private loans will be spelled out by the lender. But I don’t know of any private loans that have a grace period AFTER graduation before payment begins. And many start payment immediately.
