MBA Loans for International Students
Although earning your Master of Business Administration (MBA) can lead to lucrative career opportunities, you’ll first need to figure out a way to pay for your degree. The average cost of an MBA program in the United States is US$61,800, according to the Education Data Initiative, but some schools charge well over US$100,000.
Even if you have some savings or financial help from your family, you may need additional financing to cover the costs of tuition, fees, housing, and other living expenses. One option is to take an MBA loan.
Explore your options before taking an MBA loan
While MBA loans can be helpful financing tools to cover the costs of your education, you want to avoid taking on too much debt. You have to pay student loans back with interest, which could cost you a significant amount over the years.
Before you take a loan, reach out to the financial aid office at your school to discuss your financing options. Explore opportunities for grants and scholarships, such as the Fulbright Foreign Student program, that will help cover at least some of your expenses.
Since grants and scholarships are types of gift aid that you don’t have to pay back, they can lower your educational costs and reduce the amount you need to take in MBA loans.
You may need a cosigner for your MBA loan
As an international student, you’re not eligible for federal student loans from the U.S. Department of Education. Instead, you’ll need to obtain a student loan from a private lender, such as a bank, credit union, or online loan company.
Most private lenders in the U.S. require you to have steady income, an established credit history, and a good credit score, which many international students do not initially have. As a result, you may be required to apply for your loan with a cosigner.
Specifically, you may need to apply with a co-signer who’s a U.S. citizen or permanent resident and has a steady income along with an established credit and a credit score of 670 or higher. Your loan’s interest rate and terms will be based on your cosigner’s credit.
Your cosigner will also become equally responsible for the MBA loan, meaning they’ll be expected to repay it if you fall behind. If you miss payments, your cosigner’s credit may be affected.
What to do if you don’t have a cosigner
If you don’t have a cosigner, you’re not out of options. Some lenders, such as MPOWER Financing, offer MBA loans to international students without a cosigner or collateral required.
You’ll still have to meet other requirements, such as attending an eligible school.
Final word on MBA loans
If you’re on the hunt for an international MBA student loan, make sure to do your homework before you pick a lender. Consider the amount you want to borrow and the terms and conditions that will come with your loan, including the loan’s:
- Interest rate, and whether it’s fixed or variable
- Annual percentage rate (APR), which includes both interest and fees
- Repayment term in months or years
- Loan fees, such as an administrative or origination fee
- Grace period before you have to start making payments
Additionally, find out when your first payment is due to ensure you don’t miss any bills. Once you get a job after graduation and start earning an income, you could consider making extra payments on your MBA loan to pay it off faster.
For more information on MBA loans for international students, start your search with MPOWER Financing.
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