There are almost 500,000 people in the United States working on visas who attended college and may have wracked up student loan debt in the process. But for these students, getting a solid rate on their student loans through international student loan refinance has been challenging.
Most lenders in the United States don’t loan to visa holders, leaving them stuck in higher interest loans - even though they may qualify for better rates.
How Refinancing Works Normally vs. For International Students
Student loan refinancing is the process where you replace your existing student loans with new ones. The goal is to lower the interest rate, lower the monthly payment, or both. This can help make the loan more affordable, and potentially save money over the life of the loan.
To qualify for student loan refinancing, you typically have to:
- Be an American citizen
- Have employment
- Have a solid credit score
- Have a good debt-to-income ratio
What does that mean for international students?
That first factor - being a citizen - shuts out a lot of potentially highly-qualified borrowers who are working in the United States on a visa. These students may have gone to college or graduate school here, are working here, have a high paying job, but because they aren’t citizens, they can’t refinance their student loans.
High Demand For International Student Loan Refinancing
Almost all US banks and credit unions require that borrowers be citizens in order to refinance their student loans. However, graduates who are working in the US on a visa typically are prime candidates to refinance. Why? They have steady jobs with good income, and their student loan debt is typically manageable.
So with deserving borrowers wanting to find a way to save on their student loans, what’s being done in the financial space to meet their demand?
Sadly, not much. There are not many lenders who will offer loan refinancing to international borrowers. One of the major lenders, Prodigy, stopped offering student loan refinancing in 2019.
International Refinancing Options
Refinancing options for international working graduates are rare as local lenders are not structured to support cross-border funding or enforce international loan repayment – and these alumni are often on ‘temporary resident’ visas such as the F1, OPT and H1-B.
However, most of these workers are in high-wage professions. They wouldn’t be in the United States otherwise! These are engineers and medical professionals, nurses and dentists, even lawyers and government workers.
Right now, SoFi is the only lender offering international student loan refinancing.
To qualify, you must hold a J-1, H-1B, E-2, O-1 or TN visa. You'll also need to have at least two years remaining until your status expires or provide proof that you’ve filed for an extension.
Final Thoughts
Being an international student and expat in the United States can be a challenge when it comes to dealing with your student loans.
If you have a student loan with a high rate, check out your options and see if it makes sense to refinance.
Robert Farrington is America’s Millennial Money Expert® and America’s Student Loan Debt Expert™, and the founder of The College Investor, a personal finance site dedicated to helping millennials escape student loan debt to start investing and building wealth for the future. You can learn more about him on the About Page or on his personal site RobertFarrington.com.
He regularly writes about investing, student loan debt, and general personal finance topics geared toward anyone wanting to earn more, get out of debt, and start building wealth for the future.
He has been quoted in major publications, including the New York Times, Wall Street Journal, Washington Post, ABC, NBC, Today, and more. He is also a regular contributor to Forbes.
Editor: Clint Proctor Reviewed by: Chris Muller
