International students planning their future

From Our Partner

Whether you’re an international student or not, pursing a degree at an American university is an exciting opportunity. Of course, it’s also a rather expensive endeavor. And for the international student, it can be even more complicated to fund. Fortunately, the folks at MPOWER Financing have crafted this handy 7-step guide to help you navigate the financial aid process and determine what’s best for you.


Estimate how much you’ll need to complete your degree. To do this, you’ll have to factor in the cost of tuition, miscellaneous fees, health insurance, and living expenses (which can vary significantly by location).


Determine how much of the total cost you can finance with your:

  • Personal or family savings.
  • Financial aid from your school (Be advised that while most U.S. schools offer very limited need-based scholarships or financial aid to international students, some provide merit-based scholarships to exceptional candidates. Additionally, if you have offers from more than one school, see if you can get your top-choice school to match them).
  • Scholarships from outside organizations (like scholarships for international students on
  • Scholarships or low-cost loans provided by your own government (like ColFuturo in Colombia or FUNED in Mexico).
  • Anticipated earnings from on-campus job (like work-study or a teaching/research assistantship).


Subtract the amount you know you can finance (#2) from the total amount you need (#1). Voila: that’s how much you’ll need to borrow.


First determine which lenders will even consider you for a loan, which you can do by checking their requirements and whether you satisfy them.

  • Co-signer: A co-signer is essentially someone who is vouching for you, not just by word-of-mouth but with a financial guarantee to back up the lender’s investment in you. The more reliable your co-signer, the more likely you’ll not only be approved but have the cost reduced.
  • Credit Score: In the U.S., many lenders want to see your credit score—essentially, a third-party’s assessment of your history of making timely payments on debt. In many countries, credit scores are not tracked. And U.S. banks are often unable to access or accept credit reports from other countries. If you don’t have a U.S. credit score or you have a bad credit history, these types of lenders will not consider you.
  • Usage: Many lenders have restrictions on universities or majors/degree programs . . . which means they may not cover your desired program! Along the same lines, some lenders may have a policy restricting the types of expenses they can cover (e.g., tuition and fees but not health insurance or living expenses). After all that, be advised that what a lender is willing to provide you may not meet your financing needs, either requiring that you take out more money than you need, or falling short of the total that you’re seeking.
  • Collateral: Collateral is an asset, such as a home, car, jewelry, or other piece of personal property. Traditional banks typically lend only when an applicant has collateral with a value equal to (or generally exceeding) the amount loaned. A piece of collateral can be pledged against the loan and then seized by the bank if the applicant fails to make payments. If you or your co-signer have collateral to pledge, this could also bring your cost down. Unfortunately, this is not usually an option for many international students.


Once you’ve determined the loans for which you’re eligible, you must then hone in on the lenders that will best meet your needs. To do so, consider the following:

  • Is the interest rate fixed or variable? If it’s variable, you won’t be able to accurately predict your future loan payments! Variable interest rates change based on market fluctuations and thus you bear all the risk of interest rate changes. This makes setting up automatic payments difficult as those monthly payments will change every time the interest rate changes.
  • What is the interest rate charged, what is the length of the repayment period, and will the expected monthly payment be one you can afford given your expected post-graduation earnings?
  • What is the currency in which the loan must be repaid? You probably want to pay back the loan in the same currency in which you will be earning a salary (post-graduation) to avoid exchange rate risk.
  • Can you make repayments from abroad? It isn’t always easy to remotely pay back a loan—logistically, not just financially—so make sure that you can take care of this regardless of where you may move post-college.
  • Will the loan count toward establishing your U.S. credit history? If you’re planning to stay and work in the U.S., this may be a crucial point, as some employment background checks look at your credit score, and you’ll need good credit down the road to get a car or home loan.
  • Will the lender provide you with a visa support letter in order to get your I-20? This document, issued to accepted students by Student and Exchange Visitor Program [SEVP]-certified schools, indicates a student's primary purpose for coming to the United States.
  • Are there any prepayment penalties? In short, should you be able to pay off the capital more quickly, will you still be on the hook for interest that you would have accumulated?


At a minimum, you’ll need:

  • A copy of your passport.
  • Admission letter to the university you will be attending (or a transcript if you are already enrolled).
  • An invoice or bill from your university showing the cost of attendance.
  • Proof of any self-financing, scholarships, etc., to fill the gap between the cost of attendance and the amount borrowed.

Additionally, be aware that:

  • Lenders requiring a co-signer will also want personal documents and financial information from the co-signer.
  • Lenders requiring collateral will typically ask for an appraisal of the collateral to ensure its value meets or exceeds the amount borrowed. This may result in an in-person visit by a loan officer to the residence being mortgaged.
  • Lenders requiring a credit score will need applicants to provide a copy of a credit report from a U.S. credit bureau or, in some cases, from international credit bureau NOVA Credit.
  • Lenders that do not require collateral, a co-signer, or a credit score typically ask for additional information to demonstrate that the applicant has high academic and professional potential. For example, we at MPOWER Financing ask for standardized test scores and/or documentation of work history.


Once you get approved, you’ll be asked to sign your promissory note (usually electronically). U.S.-based lenders will then coordinate with your school on how to transfer the funds; you shouldn’t have to worry about that process. Finally, the money is typically sent right before your semester starts.

Securing loans for your education can be a fraught and frustrating process. Fortunately, companies like ours—MPOWER Financing—aim to make it easier and more transparent. Best of all, we work to ensure that you’ll be able to finance your dreams.