Background of Students Loans
There are several types of loans that are available to international students in the US, including private loans and federal loans. Federal loans are provided by the government and typically have lower interest rates and more favorable repayment terms than private loans. Some examples of federal loans that may be available to international students include Direct Subsidized Loans, Direct unsubsidized Loans, and PLUS Loans. Private loans, on the other hand, are offered by banks and other financial institutions and may have higher interest rates and less favorable repayment terms. It’s important for international students to carefully compare the terms and conditions of different loans before borrowing to ensure that they are getting the best deal possible.
Students financing involves all monetary related support given to the education of post secondary education. In many countries of the world secondary education is basic and compulsory. So it is free sponsored by the government.
In particular, student financing has to do with grants, loans and other monetary aid. This is given to undergraduate and graduate students under specific conditions. The most prominent part of student finance is student loans, it is also the focus of the blog post.
Student loan is a unique loan taken by postgraduate or undergraduate students to support their education. Just like every loan, a student loan is offered to be repaid with interest. Part of it’s uniqueness is also that, repayment can be deferred till after the students have graduated. Thus, a moratorium of two years for postgraduate students and up to four years for undergraduate students apply.
Reasons for Students Loan or Financial Aid
This looks straight forward, that is, the reason a student would need a financial aid is to support in the attainment of the degree.
But why would students bear the burden of a loan? To put this in context, statistics show that graduates still pay back student loans up to 10 years after they left the university. Medical Doctors, MBA degree holders and a few other professionals are the most burdened by the student loan debts.
- Hugh Cost of University Education. For the students, the point is, majority who request financing were most likely not able to pay the full cost of their education by themselves. The high cost of college tuition in top rated universities, would have been a deterrent to getting a university degree. Despite alternatives like scholarships and grants, students loans offer a leverage to those that were excluded from the alternatives.
- Allure of Prestigious Degrees and Colleges.
Though all fields of study has it importance to human endeavour, we can’t deny the fact that some areas of study are prestigious.
Degrees in Medicine, Law, Pharmacy and MBA (Masters of Business Administration) are highly sought after by students. They probably offer a higher post graduation financial returns. Graduates of these fields are marked in society. Therefore, demand pushes up the requirements and cost of study. Premium surely comes at a cost.
There are also prestigious colleges and universities. Such institutions of global reckoning have distinguished themselves over the years. In the United States, there are Ivy league colleges. A degree from such institutions marks the awardee from a crowd in the job market. Thus, students are fond of seeking admission into such school at any cost.
- National Advancement.
Nations of the world need quality education to progress in all spheres of human endeavour. This progress is a product of continuous university education of the citizens.
A stop gap in education, for whatever reason, including cost would be a harbinger to development. To avoid this, student loans and other students financing options were made available.
- Cheap Rates and Credit History. Student loans are very cheap interest rates spread over a long period of years. Also, there is no need for a credit history by the student. This is unlike regular loan disbursement, where the applicant’s credit history is a major determinant of the ability to pay back.
How does students loan financing work?
Different countries of the world have strict regulations guiding the operations of student loans. The basic principle of it’s operations are similar.
It should be noted that students loans are only awarded to already admitted students.
A Financing cooperation by government or Bank floats students loans. Students apply, either directly to the finance cooperation or through their university. The purpose of the student loan, which could be tuition, books or up keep as well as duration of the loan should be well stated.
Finance cooperation does check, based on it’s specific conditions to see that student meets criteria for loan.
A loan agreement is signed, stating the duration, interest, obligations and duties of loaner and loaned.
Some finance cooperation require a cosigners. Funds are disbursed directly to university or college.
Countries with Student loans for International Students
Most countries of the world offer student loans to only permanent residents and citizens. This is partly because such loans are part of the government welfare scheme. It is attached to tax and the social security identity of the student.
- Australia: students loans are granted through a government scheme HECS-HELP. Graduates only pay back as tax when employed.
- New Zealand: similar to Australia.
- France: student loans is operated by government.
- United Kingdom
Among these, the countries that offer student loans to International students are;
- United States
- United Kingdom: student loans are available to undergraduate and postgraduate students. There are loans offers by direct finance cooperations, without passing through the school. Interest begin to count but repayment is after graduation.
Private finance organisations offering students loans
Conclusion on Student Loans and Financing
These resources will give further guide in student loans.
- You can also search through the portal for different loan options. https://www.internationalstudent.com/loans/
- For applicants to the UK, see the approved student loans company by the government https://www.gov.uk/government/organisations/student-loans-company
- Postgraduate NigeriaPostgraduate Nigeria also provides regular resources on her scholarship page