Sasha Ramani, CFA, Associate Director of Strategy, MPOWER Financing

Sasha Ramani runs Corporate Strategy for MPOWER Financing, the leading provider of scholarships and no-cosigner loans for students from India and around the world. MPOWER offers no-cosigner loans for education at nearly 400 universities around the U.S. and Canada. Sasha holds a BMath from the University of Waterloo, a BBA from Wilfrid Laurier University, and a master’s degree in public policy from Harvard University.

 

With increasing numbers of Indian students seeking to study abroad, many will avail a loan to cover the cost of foreign tuition and living expenses. But the costs for earning an education overseas are rising, so students will want to do as much as possible to increase their odds of being approved for a loan. Here are three things that Indian student can do to improve their chances of availing an education loan for studying abroad

  1. Check Your School’s Eligibility

Several lenders have esoteric requirements about which schools and degree programs they support. For example, one lender may only provide loans to students attending schools in specific U.S. states, while another may not limit by location but instead offer loans to students attending at select schools or degree programs. And each lender has its own list of acceptable countries, for example, far fewer lenders support students at Canadian schools than American schools

To maximize their chances of receiving education loan approval, students’ first step should be to research lenders. It’s best to conduct this research before deciding which schools to apply to so students will know which combinations of schools and lenders are viable and won’t waste time applying to lenders that don’t cover their programs. In fact, many schools share a list of lenders that have successfully supported their students in the past, and websites like Edupass.org and InternationalStudentLoan.com can help to identify lenders at a specific school

  1. Have a Financial Plan

Education loans can substantially help students afford their education, but they may not cover every expense. If, for example, a lender provides a maximum loan amount of $50,000 but the total cost of education is $70,000, students would need to have a plan to bridge that cost gap. Whether it’s through personal/family savings, scholarships, or part-time work and internships, having a strategy to maintain a healthy financial path to graduation can help students’ chances of receiving an education loan

It’s also important to know that some lenders require interest-only or partial-interest payments while in school. This means that students may decide to work part time to cover these payments. While lenders may allow students to defer them, making these payments could actually help students to build a credit profile and prevent the interest from capitalizing (which could result in substantially higher payments after graduation). Fortunately, many schools offer on-campus employment opportunities to help students cover these in-school payments and working on campus also serves to help students bond with their local academic community. And in countries like Canada with more student-friendly visa policies, students can often easily secure work off-campus

  1. Have a Strong Career Plan

Lenders have a high interest in making sure students are able to successfully pay off their loans. This means that students attending degree programs that are more likely to result in high-earning careers (such as engineering) or who are on career paths that are more financially lucrative tend to have a higher chance of being approved for education loans

But in addition to simple degree economics, it’s beneficial in other ways for students to have a reasonable career path connected with their education that can provide some assurance of success after graduation. It’s also vital for providing a sense of professional security after graduation. Having a clear narrative about how a student’s degree can help their future career can help convince a lender that the student is worth the risk of a loan

It’s also beneficial for graduate degree students to leave their previous employer on good terms in order to garner good references and connections in the future, and, if possible, to secure a job offer to return. If the employer has offices around the world, that leaves students with even more opportunities and can serve as further validation for lenders that the student already has a potential career placement lined up for them after graduation

As always, though specific lenders will have unique criteria for study abroad loan applications, most students will face similar eligibility requirements. Students who research those requirements and who have a strong financial and career plan should be able to avail an education loan and will be well prepared when studying abroad

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