How to refinance student loans as an international student

International student loan refinancing can be more challenging, but you have options. (iStock)

Refinancing student loans can save you a significant amount of money, replacing multiple loans with one loan with a single monthly payment and, ideally, a lower interest rate than what you currently have. 

If you’re an international student, refinancing your loans can be challenging — but it can be done. Here’s what you need to know about international student loan refinancing, plus a couple lenders that offer this option. 

With Credible, you can compare student loan refinance rates from various lenders in minutes.

  • How to qualify for international student loan refinancing
  • How to refinance student loans when you’re an international student
  • Lenders that offer international student loan refinancing
  • Potential challenges when refinancing
  • Pros and cons of student loan refinancing
  • Alternatives to student loan refinancing

How to qualify for international student loan refinancing

As an international student, you’ll likely have a few additional hurdles to jump to qualify to refinance your student loans. Requirements vary by lender, but here are a few things you’ll need to qualify for international student loan refinancing:

  • Proof of residency status — This could be as simple as a Social Security number, if you have one. You may also need to show that you’re in the country legally by providing a copy of your visa. Lenders may accept different kinds of visas, but these typically qualify: E-2, E-3, H-1B, J-1, L-1 or O-1.
  • Solid credit history Lenders may have minimum credit scores or other financial criteria to determine whether you qualify for a loan. As an international student, this may pose a challenge if you haven’t built up a credit history in the U.S. You may want to collect information on bills you pay regularly — like a cellphone bill or rent — to make your case to the lender that you’re not a credit risk.
  • Employment or other income To refinance student loans, you generally need to be employed or have a job offer for employment that begins soon. Without this, you’ll need to document income from other sources to show you can repay the loan.
  • Degree Some lenders require graduation with a degree (often an associate’s degree or higher) from an accredited institution to qualify for student loan refinancing.
  • Cosigner Depending on the lender, you may need a cosigner who’s a U.S. citizen or permanent resident to qualify for a refinance. If your credit history is spotty, you may need a cosigner as well.

How to refinance student loans when you’re an international student

If you’re looking to refinance student loans as an international student, here are a few steps to follow:

1. Check your credit

Your credit score is one of the first things lenders look at when deciding whether you qualify to refinance your student loans. It’s a good idea to examine your credit report first to see whether you’re in good shape. You can request a free copy of your report through AnnualCreditReport.com. You’ll need a Social Security number to request your reports online. 

If you don’t have a Social Security number, chances are you don’t have much of a credit history. Most financial products require a Social Security number to open an account. You may be able to start building a credit history by requesting an Individual Taxpayer Identification Number from the IRS. Some banks or credit unions may allow you to open an account using a passport number or alien identification card number.

2. Find a cosigner

A cosigner will make it significantly easier to qualify for a refinance loan and greatly increase your options. You’ll want to find a cosigner who’s a U.S. citizen or permanent resident with a Social Security number and good credit history. A cosigner can be a family member or (in some cases) a close friend, but you’ll want to make sure this person realizes that they’re equally responsible for the loan. Even if you plan on making all the payments, the new loan can still affect their credit.

3. Comparison shop between lenders

Once you have your financial situation sorted out, you can begin searching for lenders who are likely to qualify you for student loan refinancing. Look through the qualifying criteria, which is typically published on the lender’s website. Lenders also often publish interest rate ranges that’ll give you a sense of how much you’ll pay. Comparison shopping will help you get the best rates and terms.

4. Prequalify for a few loans

Once you’ve narrowed down the list to a few lenders, you can check your rate and prequalify for a refinance loan with them. In most cases, you’ll need a Social Security number to do so. You may consider contacting customer service for the lenders you’re interested in and explaining your situation to see what options you have.

5. Apply for a loan

After getting quotes from a few different lenders, choose the best option and submit a complete application.

6. Accept your loan

If you're approved, your lender will ask you to fill out paperwork to formally accept the loan. The lender will also have instructions on how your existing student loans will be paid off. Be sure to continue paying your loans until you get confirmation that they’re satisfied. 

Credible lets you compare student loan refinance rates to find the best one for you.

Lenders that offer international student loan refinancing

Some private student lenders require you to be a U.S. citizen or permanent resident to qualify for a refinance loan. But resident aliens and visa holders still have options. The following two Credible partner lenders help international students refinance their student loans.

Citizens Bank

Citizens Bank offers a wide range of terms for student loan refinancing, and borrowers can choose from fixed or variable rates.

  • Loan amounts: $10,000 to $750,000, depending on degree type
  • Loan terms: 5, 7, 10, 15 or 20 years
  • Eligibility: Must be U.S. citizen, permanent resident or resident alien with a valid Social Security number; must have at least $10,000 in student loans
  • Fees: Late payment
  • Discounts: Loyalty and autopay
  • Cosigner release: After 36 consecutive on-time payments

SoFi

SoFi offers to match competitors’ rates if you find a lower one, and will then give you $100 when you close the loan.

  • Loan amounts: $5,000 up to the full balance of your student loans
  • Loan terms: 5, 7, 10, 15 or 20 years
  • Eligibility: Must be U.S. citizen, permanent resident or visa holder; non-permanent resident aliens or DACA recipients without a valid visa must apply with a cosigner who’s a U.S. citizen or permanent resident
  • Fees: None
  • Discounts: Loyalty and autopay
  • Cosigner release: Not available

Potential challenges when refinancing

Refinancing student loans can be a particular challenge for international students, since lenders may view them as high-risk. Here are a few different challenges you may face: 

Not enough credit history

Many lenders have minimum credit score requirements to qualify for a student loan refinance. If you’re an international student who hasn’t lived in the U.S. long, it can be difficult to build up a credit history that will qualify you for a loan.

May need a cosigner

Some lenders won’t offer refinance loans to international students without a U.S. citizen or permanent resident serving as a cosigner. Cosigners may also be required for international students with a thin credit history. Your cosigner is equally responsible for the loan. 

Must have proof of visa status

You’ll generally have to provide evidence of your legal status in the country. This could be a valid U.S. Social Security number or a copy of your visa.

Pros and cons of student loan refinancing

Like any major financial decision, refinancing your student loans has its benefits and downsides. Here are a few to consider:

Pros of refinancing student loans

  • You may lower your interest rate. If rates have fallen or your financial situation has improved, you may qualify for a better interest rate than you’re currently paying on your student loans. A new loan with a better rate can save you a significant amount of money in interest over the life of your loan.
  • You can create a single monthly payment. A bunch of student loans, each with its own due date and payment amount, can be challenging to manage. Refinancing your student loans can consolidate them into a single loan with a single payment amount and due date.
  • You can control your monthly payment. If you’re looking for a lower monthly payment, you may be able to refinance into a longer-term loan that requires you to pay less each month (keep in mind that even though your monthly payment will be lower, your interest rate will likely be higher). If you’re eager to be debt-free faster, a shorter-term loan can help you pay down your balance more quickly — in this case, your monthly payment may be higher.

Cons of refinancing student loans

  • You may have difficulty qualifying. Qualifying for a refinance loan can be challenging, especially as an international student. You’ll need to find a lender willing to approve international students and demonstrate your financial health.
  • Your interest rate may be higher. Depending on the market and your financial situation, you may not qualify for a very low interest rate. In this case, refinancing may not make sense.
  • You may pay for longer. If you refinance to a loan with a longer term, you’ll need to pay on your loan for a longer period of time and may pay more in interest over the life of the loan.

Alternatives to student loan refinancing 

Depending on what you’re trying to achieve by refinancing, you may have alternatives to a student loan refinance. Here are a few to consider:

  • Personal loans These unsecured loans are typically paid back at fixed rates. Many personal loan lenders prohibit the loans from being used for educational expenses, so you’ll want to double-check before going this route.
  • Borrow from friends or family You may be able to ask for help from a friend or family member to get more breathing room in your budget for a period of time. Just be sure to put everything in writing so that everyone’s on the same page.
  • Grants or scholarships Depending on whether you’re still in school, you may qualify for grants, scholarships or other financial aid that will help you pare down your educational debt.
  • Continue your current repayment plan If you’re not able to refinance your student loans, you can still pay them down under your current payment schedule. It may take longer or cost more than if you were able to refinance, but you’ll still be debt-free over time.

If you decide to refinance your student loans, Credible makes it easy to compare student loan refinance rates.

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