Student Loans For International Students What To Know

So you want to study in the USA or UK and got admission in a top university, but what about money? The fees and living costs are so high, that you can feel your heart racing.

And to make things worse, for international students, there is no collateral, etc, and no local credit history.

According to the Indian Students Mobility Report, in 2023, around 13 lakh Indian students are going abroad for their studies every year.

But the worry about funding frightens everyone. This article will clarify everything by being your brother.

We will discuss student loans- how to get them what options are there with no collateral

And we will discuss interest rates and how to get scholarships. Besides, scheme like SBI’s Global Ed-Vantage is very helpful.

So just read this article and learn how to do it to accomplish your dream of studying abroad. Come on. ready? Let’s tell you how to get a loan and that too really easily.

Understanding Student Loans For International Students

What is a student loan? In simple terms, it is money which the bank / lender gives to you to be able to study in countries like USA, UK, Canada or Australia.
You can use it to pay for fees hostel food everything and you will have to repay later with a little interest.
How does this work for international students in the USA? Well tuition fees are in lakhs and scholarships are not easy to get.
That is why you need a loan.
There are two types of loans secured and unsecured loans. Secured means you have to collateralise your house or property.
Unsecured means that you do not have to give a mortgage but the cost of borrowing will be higher in interest.
Usually, international students do not have sufficient personal funds or scholarships and even part-time jobs are not enough to pay for everything.
That is why loans are lifesavers. You just have to choose the right bank and have a plan to repay. We will discuss that next.

Eligibility Criteria For Education Loans For Abroad Studies

If you are wondering if I would get an educational loan, then stop stressing as everything is laid out quite simply here.

In terms of qualification you have to be Indian citizen of the age of 18 to 35 years. You also need finally acceptance to a recognised university for studying abroad.

You will also need a co-applicant who usually is a parent or guardian who will be legally responsible for repaying the loan in case something goes wrong.

If you are looking for a loan without collateral like unsecured loan, the competition is very tough. Similar to SBI Global Ed-Vantage scheme admission should be to top universities only then you will get an unsecured loan. Here the 100% chance of receiving the loan depends upon a solid profile.

Academics matter in terms of loan approval Marks should be good, entrance test scores should be correct and overall profile should be outstanding too. Overall you need to show the bank you are serious and capable.

How To Get An Education Loan For Abroad Studies Without Collateral

If you belong to a middle-class family and you are unable to provide collateral like house or property there is no need to worry collateral cfree education loans are made for students like you.

In this you do not need to pledge any asset to a bank, This is for people each student whose parents has very little property. Approval mostly depends on the profile and name of the university.

This scheme of SBI gives loan up to ₹50 lakh to top universities without collateral, Names like MIT Stanford, Oxford come in this list however you must have a strong academic record and proof of admission is must.

Other players like Union Bank IDFC First Bank has to offer, Propelled also has unsecured loans. The terms may be a bit strict like they may check the income of your co-applicant and of course they check the roi return on the investment too.

Best Banks For Education Loans For International Students

If you are wondering Which is the best bank for education loan abroad then here it is a simple comparison without any technical knowledge.

SBI comes first as the interest rate between 9.65-11.15% is really competitive. A 15 years repayment period means it is quite flexible.

Also you can get collateral free option if you get admission in top universities like MIT, oxford etc.

HDFC Credila is a private bank and it offers a lot of personalized options for studying abroad. The interest might be a little bit higher than SBI but the processing is faster, also parent’s/co-applicant income is also checked in here.

ICICI Bank is well-known for faster processing times and has several repayment options. Union Bank does require a bit more paperwork but does provide collateral free options if you would like to secure admission in a top university.

This is a private international lender, targeting foreign students. No collateral required at all and lending the repayment success rate is over 99%+, which shows that students can repay easily.

Interest Rates For International Student Loans

Many students get into panic mode after seeing the interest rate but if you understand a little smartly then this part becomes manageable.

For unsecured loans females get 9.65%, males get 10.15%, If you are taking a secured loan meaning you have secured some asset, then the rate is between 10.15%–11.15%, Rinn Raksha policy holders can get a discount of up to 0.5% a little more relief.

Banks like HDFC Credila ICICI charge interest up to 13%–15%. You get fast approval but it can be a little expensive.

A lender like Prodigy Finance works on floating interest rates, This changes according to the market – sometimes less, sometimes more. This impacts the EMI if the rate increases you may have to pay extra EMI.

Government Education Loan Schemes for Study Abroad

The government also supports the dream of studying abroad, especially for those students who feel some financial pressure

This scheme is for students from the minority community. In this the government itself pays the interest for the moratorium period meaning during studies + job search time you will only repay the principal amount later.

This subsidy is available for OBC and EBC category students. The process is the same the interest load reduces during the moratorium period which makes the loan manageable.

A single platform where you can apply for loan options from multiple banks less hassle of filling forms and everything can be tracked.

Scholarships For International Students: An Alternative To Loans

The best alternative to avoid the pressure of loan is scholarship, And yes if you apply with a strong profile then it can save a lot of money.

The Fulbright Program (USA) and Chevening Scholarship (UK) are both prestigious options that cover tuition + living costs.

There are also university-specific grants, such as Oxford MIT or Stanford which offer their own merit scholarships getting admission is a must.

Getting a scholarship is not easy you need to be strong in academics CGPA, entrance scores, etc. and have impactful extracurriculars. Community service internships or leadership activities all add value.

If you search What is the easiest scholarship to get for international students small university grants or need-based aid are more accessible, especially among private colleges.

Who Pays For International Students’ Education?

When you plan to study abroad, the biggest question is of money but there are enough options that make this journey possible.

Do students fund their studies using their personal savings or family’s financial support? Parents are often ready to cover the initial fees or living expenses.

Taking a loan is a common choice and the role of the co-applicant is very important here. Usually a parent or guardian becomes the co-applicant and if the student is unable to repay, the legal responsibility is theirs.

If you are lucky and get a scholarship, then there is no need for a loan. Part-time work can also become a source of income in permitted countries like Canada, UK, Australia but tuition is quite high so full funding is difficult.

You can get tax deduction under Section 80E when paying loan interest this is applicable only on the interest amount, not on the principal.

Choosing The Best Loan For International Students

When you choose a loan to study abroad, you not only have to think Which bank should I take from? but also Which loan will be best for me? and here is a simple breakdown of that.

Low interest means less EMI stress. SBI is top choice for low rates 9.65%–11.15% and up to 15 years repayment period quite flexible. If you are going for top universities you can also get collateral-free loan.

If you cannot arrange a local co-signer, Prodigy Finance is perfect. No collateral is required and repayment options are easy too specially designed for international students.

Platforms like FundRight and GyanDhan show you multiple loan offers side-by-side interest, processing time, coverage, everything is clear.

This way, you can pick the best deal for tuition travel and living expenses.

Opinion: Making Study Abroad Financially Accessible

The dream of studying abroad should not be a privilege of only rich kids every student no matter what background he comes from, deserves a fair chance.

Banks like SBI have played a big role in democratizing education. Through collateral-free loans and subsidies, they have also allowed middle-income families to reach global platforms of education.

Padho Pardesh or Ambedkar subsidy schemes also help in reducing financial pressure.

But only those students make smart moves who plan early Finding scholarships, comparing loan options from sites like FundRight, GyanDhan and building a strong profileall of this together makes debt manageable.

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