How to Get a Student Loan for an International Student with a Co-signer
Attending school in the U.S. can be a way to get a good education and good job. Learn about getting student loans for international students with a co-signer.
Attending school in the United States can be a way to get a good education and prepare for a good job. However, university can be expensive, and it might be difficult to pay for your schooling without getting a loan.
Getting a loan in the United States can be tricky, though, since there are specific credit requirements. In order to help you get a loan, there are student loans for international students with a co-signer. Here’s what you need to know about getting a student loan with a co-signer as an international student.
What is a co-signer?
A loan co-signer is someone willing to take on responsibility for your loan if you don’t make your payments. If you find a co-signer for your international student loan, that person is willing to guarantee the loan. It’s a big responsibility, and finding someone willing to be a co-signer can be difficult if you aren’t able to show that you’ll be able to fulfill the terms of the loan later.
How a co-signer helps with international student loans
When searching for international student loans with a co-signer, it’s important to understand how having a co-signer helps your situation.
First of all, lenders in the United States have various criteria they use to determine whether you’re likely to repay the loan. One of those criteria is your credit history. However, if you haven’t lived in the United States and borrowed money, you won’t have a credit history. A co-signer with good credit can increase the chances that you’ll be approved for your international student loan.
That good credit offers the lender some assurance that the person guaranteeing the loan will likely repay it if you are unable to.
Another way a co-signer can help with student loans is by helping you get a lower interest rate. The interest rate on a loan is often related to the perceived risk posed by the borrower. If you’re considered a high risk of default, the interest rate is likely to be higher so that the lender gets more of its money ahead of time.
On the other hand, if you’re considered a low risk of default, the interest rate is likely to be lower — and you’ll save money on the overall cost of the loan.
A co-signer with good credit reduces the risk to the lender and could result in a lower interest rate, helping you pay less for your schooling.
Depending on the situation, you might be able to get an international student loan without a co-signer, but in many cases, a co-signer is a good idea. You can compare student loans for international students, including through Juno, to see where you’re likely to get the best deal.
Co-signer requirements for international student loans
As you consider who can be a co-signer for your international student loans, it’s important to have an idea of what is required. In general, some of the requirements for student loans for international students with a co-signer include:
- U.S. citizen or permanent resident.
- Lived in the U.S. for at least two years.
- Good credit.
Additionally, a good co-signer has the following characteristics:
- Ability to pay: Lenders look at co-signers to see whether they’re likely to be able to take over payments if you default. As a result, your potential co-signer should have regular and sufficient income and should be able to cover this debt in addition to other expenses and debt payments they have.
- Stability: Depending on the lender, your co-signer might need to show a history of regular and stable income and might need to have lived at their current address for a substantial period of time. Lenders want to know that the co-signer is likely to stick around and that they will have an ongoing and stable source of income.
Many international students start by looking at family and friends living in the United States for co-signers on international student loans. Look for someone who can provide their citizenship or residency, can show a credit history, has a permanent address and can potentially provide references. If possible, someone with a Social Security number is likely to be your best choice.
How to reduce the need for student loans for international students with a co-signer
If you don’t have friends or family in the United States and if you think it will be difficult to find a co-signer for your student loans, you can take steps to reduce your need to borrow.
First of all, you might be able to find student loans for international students without a co-signer. These aren’t very common products, but they are available, including through Juno. You’re more likely to be able to get a loan without a co-signer if you’re a graduate student and if you can demonstrate that your past academic success points to the possibility of a good job when you finish your degree.
There are other steps you can take, however, to reduce your need for student loans:
- Scholarships and grants: Apply for scholarships and grants that don’t need to be paid back. The United States has its Fulbright Program, which can help international students. However, this isn’t the only option. Your home country might have grants and scholarships, and there are other programs aimed at helping international students.
- Personal savings: If you have personal savings, these funds can be used to help cover your school costs and reduce the need for private student loans to cover your schooling.
- Family and friends: Even if your family and friends can’t help you by co-signing a loan, they might be able to provide you with some of the money you need to pay for school.
Remember: If you come to the United States on a student visa, you might be limited in terms of where and how much you can work. In those cases, having a job while living in the United States won’t be an option to help you pay for school.
Compare student loans for international students, looking for options that require a co-signer as well as those that don’t require a co-signer. Figure out what’s likely to work best for you so you can make the most of your education.
Miranda has 10+ years of experience covering financial markets for various online and offline publications, including contributions to Marketwatch, NPR, Forbes, FOX Business, Yahoo Finance, and The Hill. She is the co-host of the Money Tree Investing podcast and she has a Master of Arts in Journalism from Syracuse University
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