Do STEM Students Get Easier Loans to Study in the USA? Myths vs Facts

Table of Contents

1. Myth #1: STEM Courses Automatically Guarantee Loan Approval 
2. Myth #2: You Need Collateral to Get an Education Loan for STEM Study in the USA 
3. Myth #3: There are No Loan Options Without Collateral for US Education
4. Myth #4: Savings is Better than Opting for A STEM Education Loan USA
5. Myth #5: No Credit Means No Loan Approval for STEM Study in the USA
6. Myth #6: A STEM Education Loan USA Covers Only the Tuition Fee
7. Myth #7: All STEM Courses are Eligible for Education Loan Funding 
8. Myth #8: The STEM Education Loan Options for the USA Process is Lengthy
9. Myth #9: Repayment Terms are Rigid for STEM Education Loans in the USA 
10. Myth #10: There’s No Loan Debt While Studying 
11. Conclusion
12. Frequently Asked Questions 

STEM courses are in the prime category for education loan options. Lenders offer education loan options for STEM courses in the USA due to its better job markets, industry demands, and high earning potential. 

Does choosing a STEM course in the USA overlook everything for an education loan? Just because you chose a STEM course in the USA does not guarantee you will get an education loan. Myths around STEM courses are many, and today, let’s debunk some of them. 

Myth #1: STEM Courses Automatically Guarantee Loan Approval 

Popular belief is that STEM courses are easily accepted for education loans from banks, NBFCs, or international lenders. The high job prospects of STEM courses allow lenders to offer loans conveniently. 

Fact: STEM courses help, but they never guarantee a loan approval. A loan approval depends on many factors like your university ranking and course reputation, academic profile, cosigner’s income and credit history, and the type of lender you choose. 

Myth #2: You Need Collateral to Get an Education Loan for STEM Study in the USA 

Banks often require collateral guarantees to offer STEM education loan options to students in the USA. The collateral value is directly proportional to the loan amount. 

Fact: Collateral is not always mandatory for an education loan to study STEM in the USA. Indian banks, NBFCs, international lenders, and US banks offer student loans without collateral. You need a cosigner for most of the no-collateral loan options. 

Myth #3: There are No Loan Options Without A Cosigner for US Education

A cosigner is the one who guarantees your loan debt. A financially eligible cosigner establishes trust between you and your education loan lender. 

Fact: International lenders like MPOWER Financing and Prodigy Finance offer education loans for STEM in the USA without collateral or a cosigner. The interest rates are competitive, starting at 8.99%.

Myth #4: Savings is Better than Opting for A STEM Education Loan USA

Spending your savings is a better option than taking an education loan. Some students think that if you are not spending your savings, the loan interest rates will be an additional loss of money. 

Fact: Exhausting your emergency funds is not a wise financial decision. Opting for an education loan is a more self-reliant, financially secure decision. The interest rates are manageable once you start earning and repay the EMIs without fail. 

Myth #5: No Credit Means No Loan Approval for STEM Study in the USA

Lenders scrutinize the credit history before granting an education loan for STEM study in the USA. If your credit history is zero, it means an education loan rejection. 

Fact: You don’t need a credit history to apply for an education loan to study STEM courses in the USA. Find someone with a good credit history and CIBIL score to guarantee your loan. Lenders will allow you to get an education loan. 

Myth #6: A STEM Education Loan USA Covers Only the Tuition Fee

STEM education loans USA usually cover the tuition fee, either entirely or partially. Students must find part-time employment or use savings for living expenses. 

Fact: Education loans to study STEM courses cover academic and living expenses. The education loan disbursement includes your tuition fee, living expenses, travel charges, food, books, and health insurance. 

Myth #7: All STEM Courses are Eligible for Education Loan Funding 

Since STEM courses are funded by most education loan lenders, they are all eligible for an education loan. 

Fact: Not all STEM courses are eligible for funding. Your lender scrutinizes your course, university rankings, and future earning potential before granting an education loan. These elements influence the loan amount, interest rate, and repayment conditions. 

Myth #8: The STEM Education Loan Options for the USA Process is Lengthy

Since the loan documentation process takes time, the education loan process can be unpredictably lengthy. A delay in processing your STEM education loan application can affect the timing of your US student visa application and funding. 

Fact: The education loan application process for studying STEM in the USA is not very lengthy. For collateral loans, completing your application takes less than 30 days if the documents are proper. Around 7 – 15 days are required to complete the process for no-collateral loans. For no-collateral, no-cosigner loan options, and US cosigner loan options, 7 days are typically taken to complete the loan application. 

Myth #9: Repayment Terms are Rigid for STEM Education Loans in the USA 

Education loan repayment terms are fixed by the lender, based on your profile. Students can’t influence the lender’s decision regarding the repayment terms and conditions for education loans to study STEM in the USA. 

Fact: You can negotiate with the lender and choose a convenient repayment plan. For STEM courses in the USA, you get a year for Optional Practical Training after completion. You can find employment during this period and repay your loan after the moratorium period. The repayment plans are flexible, based on your profile.

Myth #10: There’s No Loan Debt While Studying

There is no loan repayment during the moratorium period (course years plus 6 – 12 months), so students may get the impression that no repayment has accrued during this period.

Fact: Your education loan repayment is calculated right after disbursement. STEM courses won’t exempt you from the repayment responsibility during the moratorium period. It gets added to the principal amount.  

Conclusion

While STEM courses in the USA enjoy a better chance of education loan acceptance compared to non-STEM classes, there is no guarantee that you will get an education loan just because you choose a STEM course. Before granting an education loan, your lender scrutinizes your future earning potential and profile strength. 

Dreams are set, but have you begun your journey to study in the USA? Join Nomad Credit and get complete personalized education loan guidance for free. Explore tailored education loan options to fund your STEM education in the USA. Join us today.

Frequently Asked Questions

Are education loans for STEM in the USA faster to process? 

Compared to non-STEM education loans, STEM education loans are processed. STEM courses have high job prospects, which allow lenders to provide a loan with better reliability. 

Can you get an education loan for STEM in the US from Indian banks?

Yes. Indian banks offer education loan options to study STEM in the USA with or without collateral. For education loans without collateral, the bank must list your university of study. 

What is the interest rate for student loans to study STEM in the USA? 

The interest rate for student loans to study STEM in the USA differs with your chosen lender. From Indian banks, the interest rates are 9.00% – 14.00%, while it is 12.00% – 14.00% for NBFCs. For international lenders, the interest rates are 8.99% onwards. For US banks, it starts at 3.47%. 

Do STEM education loans have a low interest rate in the USA?

STEM education loans have a low interest rate compared to non-STEM education loans. In the USA, the interest rate starts at 3.47%.  

How to apply for STEM education loans to study in the USA? 

The application process for education loans to study STEM in the USA starts with finding your lender. Visit the lender’s website online and begin the application process. Upload the documents, and wait for a decision.