The Impact of Your Credit Score on Education Loans for MS in the USA

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MS in the USA Education Loan Options

Credit scores play a significant role in getting your student loan to study MS in the USA. Either your or your cosigner’s credit scores are scrutinized before granting you an education loan. Credit scores act like proof of trustworthiness.

Your top education loan options for MS in the USA include public and private banks, NBFCs, international lenders, and US banks.

Lender Type	Maximum Loan Amount	Interest Rate	Margin Money	Repayment Period
Public banks – SBI, BoB, UBI	Up to INR 80 Lakhs – INR 1.5 Cr	9.65% for girls, 10.15% for boys	10%	10 – 12 years
Private banks – ICICI, Axis, IDFC FIRST	Up to INR 50 Lakhs	10% – 13.5%	0% – 15%	10 – 20 years
NBFCs – Credila, Avanse, Auxilo, InCred	Up to 2INR 20 Lakhs	12% – 13.5%	0%	10 – 15 years
International lenders – MPOWER Financing, Prodigy Finance	Up to 100,000 USD	8.39% – 14%	0%	10 – 20 years

US Cosigner Loan Options

You can apply for US co-signer education loan from US lenders to study for an MS in the USA. They require a US citizen or permanent resident to cosign your education loan. The US cosigner’s credit scores must be good enough (750+) to qualify for an education loan. The higher the credit score, the better your education loan terms, like interest rates and repayment flexibility.

Understanding Your Credit Score and Its Components

CIBIL score, or credit score, is a three-digit number ranging from 300 to 900. Higher numbers denote high creditworthiness and vice versa. The scores are determined by TransUnion CIBIL Limited based on your financial behaviours, including the following factors:

Your payment history
Loan debt
Credit history duration
Credit type
Fresh credit

How Does Your Credit Score Affect Your Education Loan Approvals and Interest Rates?

The higher your credit score is, the better your education loan application will be. Credit scores can impact your education loan application for an MS in the USA greatly, from determining your eligibility to negotiating your education loan terms.

Don’t underestimate—a high CIBIL score can change a “No” to a “Yes” within seconds.

Confirms your education loan eligibility: A high CIBIL score indicates financial discipline and repayment punctuality. When you apply, you or your cosigner must have a high CIBIL score to be eligible for an education loan to study MS in the USA.

Reduces your interest rate: Consistent past financial behaviors are a key to lowering your education loan interest rate. Compared to low CIBIL scores, the interest difference for a high credit score can be up to 0.25%—1%, which is huge as it accrues over 10 – 20 years of repayment.

Faster approval time: High credit scores can greece up your education loan acceptance time.

Negotiations with the loan amount and terms: A high credit score gives you more power to negotiate the education loan terms in your favour. When the lender gets more creditworthy assurance, it always benefits the student.

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Conclusion: Best Practices for Better Credit Scores

MS in the USA can be funded by an education loan, often up to 100% of the academic and living expenses. Getting an education loan for an MS in the USA is highly based on your credit score. The better the credit score, the higher are the chances of getting the loan approved, lowering the interest rate, and the best repayment schemes.

If you are going for an education loan, these are the best practices to have a good credit score:

Check your credit scores early: You can easily check your credit scores online. If your credit scores are low or zero (for those who haven’t participated in financial transactions), build credit scores gradually.

Reduce debt-to-income ratio: Pay off your loan dues and reflect a good credit history. Consider taking a small loan to repay the high loan amount.

Avoid multiple loan applications: Don’t apply for many loans at a time. When you are applying for an education loan, don’t apply for multiple loans like a car loan or personal loan.

Get your complete education loan guidance for MS in the USA – connect with Nomad Credit, your tailored study abroad partner. Get your profile evaluation, compare options, and apply for education loans easily. Join us today!

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Frequently Asked Questions

Does the student’s CIBIL score affect the education loan application?

Some lenders require the student to have a good CIBIL score to apply for an education loan to study an MS in the USA. The student’s CIBIL score can affect the loan application in those cases. For others, the cosigner’s CIBIL scores are more important than the student’s CIBIL scores.

Is a credit score important for an education loan application?

CIBIL scores are crucial for your education loan application. You or your cosigner must have a high CIBIL score to get an education loan.

Is 650 a good CIBIL score for an education loan to study in the USA?

650 is a good CIBIL score to apply for an education loan to study in the USA for an MS, MBA, etc. It is advisable to have at least a 750+ score.

What to do if the student has a low CIBIL score?

If the student has a low CIBIL score, do financial transactions and make necessary changes in financial transactions to improve the score. It is better to have a cosigner with a high CIBIL score to apply for an education loan.