It’s that time of the year – you’re scrambling to study for finals, prepping for winter break plans, and getting ready to embark on a study abroad adventure that seems right around the corner (even though in reality, it’s a few months away). It’s an exciting time where you will soon find yourself in a new country learning new languages, exploring different spices and cuisines, and soaking up as much cultural experience as possible. In order to make the most out of your experience, ensuring you have the financial means by applying for loans for study abroad to support yourself during your trip is an absolute must.
If you’re in need of a student loan advice to help you invest in your future vis-à-vis study abroad, here are five essential things to know before applying:
1. Time is of the essence, so make sure you have enough of it.
You absolutely positively definitely CANNOT wait until the last minute to apply for study abroad loans, especially with something as important as financing your upcoming international trip on the line. For some student loans, such as federal loans, only a certain amount is given out, so you need to give yourself plenty of time to submit your loan application. Many lenders recommend beginning your study abroad loan application as early as six months in advance.
2. There are many types of loans, so figure out the one you need.
There are three main types of study abroad loans: general student loans, federal loans, and private loans. Each of these have different requirements in order to apply, and specific processes in place for when you do want to apply. Be sure you research the type of study abroad loan you need before registering for one and don’t be afraid to ask for help from your university’s financial aid office.
Federal loans are usually issued to those with high financial aid needs. Those who hope to apply for one of these student loans will need to complete a FAFSA and submit your application to your university’s financial aid office.
Private student loans for study abroad are given out through a financial institute, such as a bank. The main aspect to be aware of when applying for a private loan is to ensure that the company lending the loan is credible and trustworthy.
General student loans vary from university to university. These loans usually don’t have a ton of requirements in order to apply and are open to almost every student. Your university’s financial aid office will be the best resource for you to utilize when finding our how to use these loans for study abroad. In general, student loans for travel will vary from institution to institution, so it will be your job to figure out what you need and when.
3. You must confirm that your home institution is ELIGIBLE.
This goes hand-in-hand with preparing ahead of time; why waste your time applying for a loan for study abroad that you’re not even eligible for in the first place? Study abroad loans require that you go to an approved U.S. college or university study abroad program. You can check to see if your university is eligible here.
4. You need a cosigner, and they should be credible.
A cosigner is someone who can legally sign loan papers for you so you can obtain the loan; they must be a U.S. citizen with a good credit score that has lived in the U.S. for the past two years. Having a creditworthy cosigner can not only make it easier for you to get a loan, but it can also reduce your interest rate. Family members or friends are good go-to options as they themselves can act as your cosigner or they may be able to recommend someone they know. It is fairly difficult to find student loans for study abroad without a cosigner.
As a student, having a cosigner will work in your favor because it is likely that you haven’t had the chance to build up a long line of credit history just yet. Therefore, the cosigner will increase your chances of getting a loan for study abroad. After all, you don’t want the opportunity to stuff your face with French macaroons to slip through your fingers just because of your lack of credit!
In addition to the preparation process prior to applying for study abroad loans, you should also mentally plan for after you receive the loan. While scholarships and grants don’t need to be repaid, loans do. You’ll be responsible for paying back the amount you borrowed plus an additional percentage. Make sure that you are aware of your terms and conditions and prepare ahead so that you can repay your study abroad loan on time.
5. Disbursement schedules matter – make sure it happens BEFORE you leave.
Student loans for study abroad are typically disbursed a few days before your program starts, but it ultimately depends on the schedule you’ve agreed upon with the lender. Be sure to double check your loan application to ensure that you chose the correct disbursement period, lest you end up in a foreign country with an empty bank account!
If you still haven’t received your loan 30 days after it was approved, there may have been a problem with the lender releasing your loan or uncompleted steps within the application process. To find out more specifics about the disbursement of your loan, you can contact your university’s financial aid office or the financial institution directly. Be cognizant of keeping tabs on the dates and be proactive in your follow up to avoid too many unnecessary blunders.
During the months of preparation, you can also apply for scholarships and fundraise (We <3 FundMyTravel!), in addition to applying for study abroad loans for U.S. citizens. All three of these financial realms (loans, scholarships, and fundraising) will help you tremendously while studying abroad and give you the greatest opportunity to indulge in as much meaningful travel and cultural experiences as you can.
These pieces of student loan advice are just scratching the surface. Preparing for study abroad is no easy task, especially when it comes to the dollars and cents. Face the financial hurdles head on with a combination of preparedness, exhaustion of resources, and a genuine personal investment in your experience; all of this extra work will feel more than worth it, and your student loans for study abroad will enhance your overall experience rather than detract from it.