Education Loan in the USA
Every year, more than 1 million international students join the USA to study abroad as an international student. The USA offers students real-world working experience, career opportunities, multicultural experiences, top universities of USA, and more.
Studying abroad in the USA comes with many challenges, with finance being the top challenge. A bachelor’s degree in the USA costs around $15,000 – $45,000 yearly, while a master’s degree costs $15,000 – $75,000 annually. Compared to most other top countries, the USA can be more expensive, however, the return on investment is also higher.
If you are planning to study in the USA, you will have to manage your expenses. Fortunately, Nomad Credit offers US co-signer loans starting from 3.47%. With quick loan approval, 100% funding, and minimal documentation, Nomad Credit can make your dream of the US much more affordable.
This page will discuss the eligibility requirements, types of loans, documentation, application process, & more
Cost of Studying in the USA
Before we start with our USA overseas education loan, we need to know what the cost of studying in the USA is. Studying in the USA can be expensive; however, understanding the cost is crucial for planning your study abroad journey. Here’s a breakdown of the cost of studying in the USA for you:
| Expenses | Cost |
|---|---|
| Rent | 1,000 – 3,000 USD (per month) |
| Food | 250 – 600 USD (per month) |
| Electricity | 20 – 50 USD (per month) |
| Health Insurance | 700 – 1100 USD (yearly) |
| Phone | 50 – 80 USD (per month) |
| Travel | 30 – 70 USD (per month) |
| Books | 90 – 200 USD (per month) |
| Clothes | 500 – 600 USD (yearly) |
Types of Student Loans in the USA
Various types of Foreign Education Loans are available for international students in the United States. Some of the top loan options include:
Feature | Collateral Loan | No-Collateral Loan | US Cosigner Loan |
Type | A secured loan requires security | An unsecured loan doesn’t require security | US Cosigner required |
Who Offers It | Public & Private Banks | Private Banks, NBFCs, International Lenders | US Banks |
Eligibility Criteria | Must have assets as security, co-applicant may be required | Academic performance, co-applicant income, and credit history | US Cosigner (citizen or permanent resident) |
Repayment | Risk of security takeover if unpaid | Based on the borrower’s financial and academic profile | Shared responsibility with the cosigner |
US Cosigner Loans
US banks offer US cosigner loan options to international students. For a US cosigner loan, a student requires a cosigner who is a US citizen or permanent resident. The cosigner should be financially strong and should be a friend, relative, professor, or acquaintance of the student.
Get US co-signer loans from Nomad Credit, starting at an attractive rate of 3.47%. Here’s why you should consider it:
- Zero FOREX charges
- No processing fees
- Covers 100% of attendance costs
- No collateral required
- Multiple repayment options
Collateral Loans
Numerous public banks, as well as some private banks, offer collateral, aka secured loans, to international students. A collateral loan is a type of loan that is backed by something you own, such as your property, fixed deposit, investment accounts, and more. If you are unable to repay the loan, lenders have the right to seize your possessions that were offered by you to the lender. Some of the features of Collateral loans are:
- Lower interest rates
- Higher loan amount
- Longer repayment period
No-Collateral Loans
No collateral or loan without collateral, aka unsecured loan, is usually offered by private banks, NBFCs, or international lenders to the students. A no-collateral loan doesn’t require any security or any type of collateral from the student/borrower. The lender considers your academic performance, choice of program, country, university, and co-applicant income and credit history for your study abroad education loan. Here’s why you can choose No-Collateral loans:
- Faster processing
- No security required
- Ideal for students without assets
- Flexible co-applicant requirements
Indian Banks Offering Student Loans in the USA
| Bank | Loan Amount | Processing Fee | Rate of Interest |
| SBI Bank | Minimum: INR 7.5 Lakhs Maximum: INR 1.5 Crores | INR 10,000 per application | 11.15% |
| Union Bank of India | Minimum: INR 7.5 Lakhs Maximum: INR 1.5 Crores | INR 10,000 per application | 8% – 15% |
| Axis Bank (Unsecured) | Minimum: INR 50,000 Maximum: INR 75 Lakhs | 2% of the Loan Amount + GST | 11% – 13.50% |
| ICICI Bank (Unsecured) | Minimum: INR 1 Lakhs Maximum: INR 3 Crores | 2% of the Loan Amount | 9.50% – 14.25% |
| IDFC First Bank (Unsecured) | Maximum: INR 75 Lakhs | 1.5% of the Loan Amount | 9.5% – 15% |
| HDFC Credila (Unsecured) | Maximum: INR 45 Lakhs | 1.5% of the Loan Amount + GST | 10.5% – 14% |
| Avanse | Maximum: 100% COA | 1-2% of the Loan Amount | 10.75% onwards |
| MPOWER Financing | Maximum: US $100,000 | 5% added to Loan Amount | 12.99% onwards |
| Prodigy Finance | Minimum: US $10,000 – Maximum: 100% COA | 5% of the Loan Amount | 14.96% |
| Earnest | Maximum: US $200,000 | – | 4.39% – 16.15% |
| Sallie Mae | Maximum: US $200,000 | – | 4.50% – 15.49% |
| Union Federal | Maximum: US $99,999 | – | 4.43% – 14.04% |
Note: Earnest, Sallie Mae, and Union Federal banks only offer loan when you have a US Co-signer.
Eligibility Requirements for Student Loans in the USA
To be eligible for an education loan abroad, the student must fulfill the required eligibility requirements. They are as follows:
- Must be an Indian citizen or NRI
- Must have confirmation of admission from a US university
- Must not have any overdue
- Must have legally valid documents
Eligibility for US Co-signer:
- Must be a permanent US resident (for a minimum period of 10 years)
- Must have a sufficient CIBIL score as required by the lender
- Must have a minimum credit score of 650
- Must have no record of bankruptcy
Documents Required for Student Loans in the USA
Submit documents to prove that you are eligible to apply for a study abroad loan. Some of the documents required for student loans USA are:
- Passport size photographs
- Loan application form
- KYC documents such as Aadhar card, Driving license, passport, etc
- Address proof
- Acceptance letter from the university
- Academic transcripts
- IELTS, GRE, GMAT, TOEFL, test scores
- The last 6 months’ bank statements
Factors to Consider when Choosing the Right Bank for Student Loans in the USA
- Interest Rate: Ensure that you have checked the interest rates of different banks to find the best option for you.
- Processing Fee: Each bank or lender charges different processing fees. Evaluate the fee as it adds to the overall cost of your loan.
- Loan Margin: This is considered one of the most important parts as this determines the amount you are required to pay from your pocket.
- Loan Processing Time: Each bank and lender’s loan processing time is different; ensure that it aligns with your timetable.
- Cost Coverage: Calculate how much of the cost is covered in your loan amounts, such as living expenses, travel costs, tuition fees, cost of books, and more.
Application Process for Student Loans in the USA
If you are planning to study abroad in the USA, you will need to research university options, manage your finances, complete the application process, prepare for a visa, and much more. All this sounds too overwhelming, right?
Don’t worry, you are at the right place. Nomad Credit is here to turn your dreams into reality. With the guidance of our top experts, you do not have to worry about anything. Our experts have extensive experience and can assist you throughout the process. From finding top universities according to your profile and goals to assisting you with visa and SOP, we are here to help you out.
Frequently Asked Questions
What is the Income Tax benefit for a study abroad loan?
Section 80E offers a deduction on the interest paid for the study loan. There is no maximum limit that can be claimed.
Can I get a 15 lakh education loan for studying abroad?
Yes, you can get a 15 lakh education loan for studying abroad. However, you must meet the eligibility criteria and fulfill the requirements as specified by the bank/lender.
Can I get a 100% education loan for studying abroad in the USA?
Yes, several banks/lenders offer you with 100% education loan for studying abroad in the USA.
What are the repayment options available for education loans in the USA?
Repayment options vary depending on the bank. Since students usually don’t work full-time while studying, the repayment period usually ranges from 10 – 25 years.
How much education loan can I get for a Master’s in the USA?
The amount of the loan depends on several factors, such as eligibility criteria, bank/lenders, financial profile, co-signer, and much more. You can get education loans ranging from INR 6 Lakhs – 1.25 Crores for a master’s in the USA.
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