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Funding Your Future: How to Secure a Student Loan in the USA

Every common student wishes to study in the United States of America. The country is home to some of the world’s most prestigious and top universities in the world. However, many people are hesitant to further their education in the United States due to the exorbitant cost. Studying abroad in the United States is an expensive endeavor, but with the right financial assistance, students can pursue their dreams for little or no cost. Student loans for the United States are one type of aid that assists students in living and studying in the United States without stress. Many banking and non-banking institutions in India provide education loans in the United States to international students at the lowest interest rates and with additional benefits.

If you’re also planning to study abroad but don’t have enough funds to fund your education. This article might help you secure a student loan in the USA. There are a lot of students who are looking to get quality education but in the end due to the lack of funds they failed to do so. If you don’t want to see your dream of studying in the United States shattered due to a lack of money, make sure to keep reading. In this article, we will delve into the topic and discover the ways that may help you secure a student loan.

Why Should You Get a Student Loan?

Getting a student loan can be a good option for those who want to pursue higher education but do not have the financial means to pay for it upfront. Here are some reasons why you may consider getting a student loan to study in the USA:

  1. Access to Higher Education: Higher education can be expensive especially in a country like the US, and getting a student loan can help you gain access to the education you need to pursue your career goals.
  2. Low-Interest Rates: Student loans often come with low-interest rates, which can make it easier to manage the cost of borrowing over time.
  3. Flexible Repayment Options: Many student loans offer flexible repayment options that allow you to adjust your payments based on your income and other financial circumstances.
  4. Improve Career Prospects: Getting a higher education degree can improve your career prospects and earning potential, which can help you repay your student loan over time.
  5. Build Credit: Paying your student loan on time can help you build a good credit score, which can help you access other forms of credit in the future.

Types of Student Loans

There are two types of student loans available in the USA: federal and private loans.

Federal Loans

Federal loans are backed by the government, and they come with a fixed interest rate. There are three different types of federal loans, which are listed as below:

  1. Direct Subsidized Loans: Students in need of financial assistance are eligible for these loans. During the student’s college career, the government pays the interest on these loans.
  2. Direct Unsubsidized Loans: Students can receive these loans whether they are undergraduates or graduates, without having to demonstrate financial need. The interest on these loans accrues while the student is in school.
  3. Direct PLUS Loans: Graduate students and parents of undergraduate students are eligible for these loans. They require a credit check, and the interest rate is higher than that of other federal loans.

Private Loans

Financial institutions such as banks, credit unions, and others offer private loans. In general, they carry a higher interest rate than federal loans and often require cosigners.

Eligibility Criteria For Education Loan For USA

For Federal Student Loans

Here are the eligibility requirements for federal student loans in the USA:

  • Borrowers must be US citizens, permanent residents, or eligible non-citizens.
  • The student must meet the citizenship requirements for Federal Parent PLUS loans.
  • The borrower’s credit history has no bearing on his or her eligibility for Federal Stafford loans.
  • It is necessary for a borrower to have a good credit history to qualify for a Federal PLUS loan.
  • Credit scores, debt-to-income ratios, minimum income thresholds, or employment history are not required for eligibility for federal education loans, but the borrower must not be in default on a federal education loan.
  • There is no minimum age for a federal student loan borrower.
  • It is necessary for male students to register for Selective Service, to have a high school diploma or GED (or a home-school equivalent that meets state requirements), and to maintain a satisfactory academic progress (2.0 GPA/4.0 scale).
  • Borrowers cannot obtain federal student loans after graduation, such as during a medical residency or after law school.

For Private Student Loans

Private student loans in the USA have the following eligibility requirements:

  • Credit scores, annual income, debt-to-income ratios, and employment history can all be used to determine creditworthiness.
  • The minimum legal age for a private student loan borrower may vary depending on where they live. The majority age in Indiana, Mississippi, and New York is 21, 19 in Alabama and Nebraska, and 18 in the majority of other states.
  • Both the borrower and the cosigner must be citizens of the United States. All lenders require a creditworthy U.S. citizen.
  • The majority of lenders demand that the borrower be enrolled at least half-time. Some offer unique lending schemes for people who are pursuing further education.
  • The degree, academic major, or participating school may also affect eligibility.

What is the Cost to Studying in the USA?

Tuition fees are the most significant cost associated with studying in the USA. The cost of tuition varies from institution to institution, and the fees can be quite high. According to the College Board, the average cost of studying including exam fees for the 2020–2021 academic year was $10,560 for state residents at public colleges and $27,020 for out-of-state residents attending public universities. Private universities, on the other hand, can cost even more, with an average tuition and fees of $37,650 per year.

If you are moving out from your home country to the USA to complete your further education. You will also have to include the cost of food, rent, transportation, and other basic things.


It is important to note that taking out a student loan is a serious financial commitment. So, make sure to check your ability if you are willing to pay back on time or not. If you are good at studies and unable to repay the loan, try applying for financial aid, such as scholarships and grants, before resorting to student loans.

A direct subsidized loan can be the best option for students who are tight on budget and unable to get scholarships or grants.

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