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H1B Student Loan: How to Fund Your Education While on an H1B Visa
You have been living and working in the U.S. for a while now and you’re interested in furthering your studies. This big step can maybe lead to a new job opportunity or earn you a higher salary. But, since you are an H1B visa holder, you are wondering how you’ll be able to finance studies without access to federal financial aid.
What’s more, you’re curious about whether it is even a good idea to invest money into going to grad school
Below we take a look at what it can mean for your career to get a graduate degree and also how an H1B student loan can help open up the right doors.
Benefits of a Graduate Degree
Before you dive into getting a graduate degree, you need to know whether the time, effort and money will be worth it. Let’s take a look at a few of the benefits of a graduate degree.
1. Higher Salaries
It’s as simple as that. As a rule of thumb, people with better qualifications earn higher salaries. This is especially true for those working in STEM jobs (Science, Technology, Engineering, and Mathematics).
2. More Job Opportunities
You’ve already distinguished yourself from the average person by attaining a bachelor’s degree. You’ll make your CV even more attractive by acquiring a qualification from grad school. Your chances of landing more job opportunities will grow with a master’s or Ph.D. and you will enter an elite group of people who are eligible for more specific types of jobs.
3. Growing Career Field
The STEM area of the job market is growing. These fields of study are expanding at a rapid rate. The need for labor is so high that the American government is looking for talent abroad. That is most probably how you started working in America in the first place. Once you’ve passed grad school, you’ll form part of this growing career field.
So clearly there are great benefits in going to grad school. Let’s take a look at how you can make it possible financially.
How to Finance Your Education as an H1B Visa Holder
Scholarships are great solutions because your studies will be funded without any obligation to repay the funds. And, there are many types of scholarships available too. The difficulty, however, lies in the eligibility criteria that usually go with getting a scholarship. You might be able to qualify for one, so it will definitely be worth it to set out the time and research what your scholarship options are. Keep in mind that you don’t want to wait till you get one before you start studying, so have a plan B ready.
Grants are often mistaken as scholarships as you don’t have to repay either of them. The difference, however, is that scholarships are merit-based while grants are need-based. Grants are handed out primarily by federal governments and universities, although some private organizations also supply grants. Just as with scholarships, it is certainly worth pursuing this option as you might just qualify. But, once again, make sure you have a plan B ready.
3. Student Loans
If you can’t finance your studies yourself and you need a plan B if a grant or scholarship doesn’t work out, H1B education loans are a great option. There are countless stories of successful professionals who studied on a loan. An H1B student loan works like a normal personal loan. The loan is unsecured, so you don’t need to secure the loan with something of high value like an asset or a deposit of some sorts. The terms of your loan will differ from lender to lender. Let’s take a look at some more detail.
Top 5 Lenders for H1B Student Loans
Being an H1B visa holder offers a unique blend of work and potential educational opportunities. Whether you’re looking to further your studies to enhance your career in the U.S. or to delve into a new field entirely, understanding your loan options is paramount. Fortunately, several lenders appreciate the unique position H1B holders are in and offer tailored loan options to support their academic pursuits:
AmOne (Best for Okay to Good Credit)
AmOne caters to a diverse range of borrowers and offers a unique edge for H1B visa holders with okay to good credit. Through its extensive network of lenders, AmOne connects H1B visa holders to multiple loan options that could fit their financial situations. While specific loan criteria might differ depending on the lender, AmOne’s platform potentially simplifies the process for H1B visa holders, especially if they have a creditworthy U.S. co-signer to bolster their application.
Spring Loans (Best for Bad and No Credit)
H1B visa holders who have limited or no U.S. credit history can often find it challenging to secure student loans. Spring Loans provides a solution by emphasizing a holistic financial assessment over traditional credit scores. This approach allows those with bad or no credit to potentially qualify for a loan. While having a U.S.-based co-signer can be advantageous, Spring Loans’ inclusive model can be a beacon for H1B visa holders navigating the student loan realm.
First Premier Lending (Best for Bad Credit)
First Premier Lending understands that credit history doesn’t always reflect an individual’s financial capabilities. With a special focus on those with bad credit, they provide H1B visa holders an avenue to explore student loan options tailored to their unique circumstances. Even though a creditworthy U.S. co-signer might still be necessary for approval, First Premier Lending’s framework is designed to assist those who’ve faced credit challenges.
College Ave (Best for Good Credit)
For H1B visa holders who’ve been successful in establishing good credit in the U.S., College Ave is a noteworthy choice. Recognized for its competitive rates and flexible loan terms, College Ave rewards financial diligence. While the company does provide options that might suit H1B visa holders, it is often beneficial to have a U.S. co-signer, as it might enhance the likelihood of loan approval and more favorable terms.
Sallie Mae (Best for Very Good Credit)
Sallie Mae, with its expansive student loan portfolio, is an optimal choice for H1B visa holders who have achieved very good credit. By offering some of the best interest rates and terms, Sallie Mae is a testament to the value of financial excellence. H1B visa holders looking to leverage their high creditworthiness will find Sallie Mae’s offerings attractive. However, as with most lenders, a creditworthy U.S. co-signer can make the loan application process smoother and more successful.
H1B Student Loan Process
If you are planning to finance your studies with an H1B student loan, it’s important for you to understand the process of getting loans for H1B visa holders. You don’t want to miss the start of the semester because of simple administrative issues.
When to Apply for a Student Loan
You want to apply sooner than later. You don’t have to do it a year in advance, but being prepared is crucial to your success. You can apply early and get accepted. This allows you the capacity to, then, state to your lender when you want the loan to go into effect. Some lenders take longer than others to disburse the funds, so applying early will also help to make sure you pay your tuition on time.
Most lenders who supply H1B loans will require the following documentation:
- College Acceptance – Most lenders will only supply loans to students who are already accepted at a school
- Visa – You will only gain access to credit in the U.S. if you are allowed to be in the country
- United States Address – You need to supply proof of your place of residence in the U.S
- Other Supporting Documents – Different lenders will require different documents. Without a social security card, you will probably need to supply any supporting documents like one of the following visas: F-1, H1-B, L-1; OR Forms DS-2019, I-20, I-766, or I-797.
How to Apply
Most lenders have similar application processes so let’s use Stilt as an example:
1. Submit an Application
Most lenders have online applications these days. All you need to do is go to the website to submit your loan application online. This makes applying super easy and super quick. With Stilt, you can expect feedback on your application within the first 24 hours. Other lenders might take a little longer. If more information is needed, Stilt will schedule a verification call with you to clear up the last few details.
The qualification criteria will differ from lender to lender. With Stilt, the following basic criteria are considered:
- Current employment or employability
- Financial Behaviour
- Defaults, Collections or Bankruptcies
- Credit Check or Credit Score
Although not all lenders supply loans to visa holders, Stilt supplies loans to the following visa holders
- F-1 – International Students
- OPT – Optional Practical Training
- O-1 – Extraordinary Ability
- L-1 Intracompany Transfer
- TN – NAFTA Professionals
- J-1 Cultural Exchange
- DACA – Childhood Arrivals
2. Receive an Offer
If you meet the lender’s qualification criteria, you will receive an offer and a promissory note to sign. This offer will contain all the details about your loan terms and interest rate. Make sure you read the details carefully so you know what you are signing for! If you are happy, sign and return the promissory note to your lender. With Stilt, the money should be in your account within 2-3 business days of receipt of the signed documentation. Other lenders might take a little longer, but most will only take up to a week.
3. Start Repaying Your Loan
You can now set up your preferred method of repayment. Like Stilt, most lenders have an autopay option you can enable online. With autopay, your monthly repayments are automatically deducted from your account to make sure you don’t miss a payment.
H1B Student Loan FAQ
Still have a few questions about your H1B student loan? Let us answer some of the most frequently asked questions.
How Much Should I Borrow?
This question trips many people up. You definitely don’t want to end up borrowing more than you need to. Interest on your loan will be expensive. So the best solution is to draw up a budget. Do proper research to know what your expenses will be. Then make sure you only borrow what you need.
Remember, this loan is to help you succeed. It should not lead to your financial demise.
How Will My Interest Rate Be Determined?
Every person’s situation is unique. Firstly, your interest rate will differ from lender to lender and what minimum they are willing to offer. Then secondly, your personal circumstances and risk profile will determine what rates lenders offer you. Lenders offer better interest rates to borrowers with lower risk profiles.
Your risk profile is determined by factors like your credit history, whether you sign with a cosigner, the status of your visa or residency, your ability to earn income, collateral supplied as security for the debt, and the level of your studies.
That being said, the typical student loan interest rate ranges between 2% and 14% per year.
What Are the Terms and Conditions of Student Loans?
A loan is a loan. It has a starting date and required monthly payments. But H1B education loans sometimes have some extra features that can help its borrowers.
Standard and Extended Repayment
Standard payment typically takes place over 10 years. Whereas an extended repayment takes place over a period stretching beyond 10 years. This means your monthly repayment amount is a little less to help out with the cash flow. Keep in mind, however, that this will mean you pay more interest over the lifetime of the loan.
You’ll start out with a lower monthly payment, which is a great help if you are starting out a new job with a smaller salary. Your monthly payment will gradually increase over time as you progress in your career. Over time you’ll earn higher salaries which enables you to repay larger amounts.
This means your monthly repayment is dependent on what you earn each month and it will rise and fall in accordance with your income. This helps you tremendously at the start of your career when you are still earning a low income. It also serves as security to know you won’t need to pay huge repayments when times are tough.
- H1B Mortgages in the U.S.
- Personal Loans for H1B Visa Holders: Your Best Options
- Auto Loans for H1B Visa Holders
You can have the success you dream of by furthering your studies! Follow the ideas you found here to apply for your H1B student loan today. You don’t have to settle for a below-average salary. Go qualify yourself in grad school and build your career, you don’t need to halt further studies just because you don’t have the finances. An H1B student loan can be your solution.