5 Common Myths About Engineering Education Loans in the USA – Debunked!

The field of Engineering ranks among the most important degrees because of its increased job demand, strong earning potential, and several career opportunities. For many international students who dream of an Engineering degree, their biggest problem is not the degree itself but the cost of studying in the USA.

Obtaining education loans to study in the USA might seem intimidating because many myths and half-true stories exist. This brief guide will debunk five major misconceptions about getting engineering education loans to study in the USA. Let’s begin.

Table of Contents:

1. Myth 1: You Need a Perfect Credit Score to Get a Loan
2. Myth 2: Collateral or Co-signer is Mandatory
3. Myth 3: Interest Doesn’t Matter – It’s Just a Small Percentage
4. Myth 4: All Loans Are the Same
5. Myth 5: Engineering Salaries Make Loan Repayment Easy
6. Frequently Asked Questions

Myth 1: You Need a Perfect Credit Score to Get a Loan

Many people believe wrongfully that they need flawless credit to qualify for loans. Yes, a good credit score is often required for an education loan to study in the USA, but it is not the most critical criterion. The evaluation process for lenders goes beyond credit score assessment to include other factors.

Myth 2: Collateral or Co-signer is Mandatory

Collateral is often required if you opt for a secured loan; you must pledge your property as collateral for the loan. You may need a U.S. co-signer if you opt for a co-signer loan.

Several students think that collateral or a co-signer is mandatory for an Engineering education loan in the USA, which is untrue. Collateral or a US co-signer would definitely improve your chances of a loan and may get you a better loan, but it is not mandatory.

Myth 3: Interest Doesn’t Matter – It’s Just a Small Percentage

Interest rates determine your entire loan amount; students who think it is just a small percentage or a number are wrong. The number directly impacts your loan amount and your monthly repayments.

A higher interest rate means that your loan amount will be higher in the end, and vice versa. If you are planning to apply for an education loan to study abroad in the USA, you must always check your interest rate thoroughly. If you are facing any problem understanding it, always ask your lender.

Myth 4: All Loans Are the Same

If someone tells you to apply for any loan that comes up first, as all loans are the same, absolutely do not listen to them. All loans are not the same, especially regarding an education loan for study abroad.

Several lenders are in the market, private, public, NBFCs, international, etc. All lenders maintain different loan requirements, including eligibility criteria, paperwork, processing charges, and interest rates. Make sure to research thoroughly, along with a thorough comparison of the best available options.

Myth 5: Engineering Salaries Make Loan Repayment Easy

Most students think that pursuing an Engineering degree will automatically make loan repayments easy, but this is a big myth. Engineering gives students many career options, which also bring higher pay, but repaying their student loans presents challenges.

Even with a good salary, you will have to manage your other expenses. Loan repayment depends on various factors, including living expenses, interest rates, and repayment period terms.

Frequently Asked Questions

How to get a US co-signer for an education loan to study in the USA?

To get a US co-signer education loan to study in the USA, you would require someone with a good credit score, stable income, and willing to take on the responsibility of your loan repayments.

Can I get an Engineering education loan for the USA?

Yes, you can get an Engineering education loan for the USA. Check with your preferred lender and fulfill all the requirements as asked for a successful loan application.

How can I get a loan as an international student in the USA?

International students can apply for an education loan in the USA from a private lender or a bank. MPOWER Financing, Prodigy Finance, and Sallie Mae are some of the top lenders offering education loans in the USA.

Can an Indian student apply for a US co-signer loan?

Yes, an Indian student can apply for a US co-signer loan if they have a US co-signer, a US citizen or permanent resident. Nomad Credit offers a US co-signer loan starting from 3.47%.

Is a co-signer required for a study loan in the USA?

Yes, a US co-signer is often required for a study loan in the USA, especially for international students.