Financial guidance

Education Loan for USA: Guide on Education Loan in USA for Indian Students

Yocket Editorial Team

Reports state that, out of 193 countries in the world, USA ranks 10th among nations with the highest cost of living. Further, it is the 3rd most expensive study abroad destination with an annual total cost of $36,564. Despite the intensifying expenses, a significant chunk of Indian students travels yearly to pursue their education in the USA. But why? The answer—due to its academic excellence and availability of education loan for USA studies.

So even if you are not financially strong, with an education loan in USA for Indian students, you can still benefit from the country’s flexible academic system, cultural diversity, global recognition, unique curriculum, and lucrative job/internship opportunities.

Let’s get meticulous insights on the international student loans USA and plan your study abroad expedition.

Table of Contents
  1. How to Finance Study in USA?
  2. Banks/Providers for Study Loan in USA
  3. Collateral and Non-collateral International Loan Requirements
  4. Study Loan in USA Eligibility Criteria
  5. Documents Required for Education Loan to Study in USA
  6. How to Apply for Student Loan in USA?

How to Finance Study in USA?

Is getting a study loan in USA an easy task? No. It can become exceptionally strenuous for Indian students to get loans from traditional banks because of their visa status. Besides, with no credit history, citizenship, and lack of co-signer, the loan process might seem impossible in the USA as well.

But worry not, there is always a solution. In this case, getting an education loan in USA for international students is a matter of selecting a suitable lending source. Given are the available options to get student loans for international students in USA.

  • Indian banks like SBI, HDFC, AXIS, PNB, and others.
  • Financial services in India like Avance Financials, Leap Finance, etc.
  • US banks and lenders like Discover, Citizen Bank, Wells Fargo, etc.

Cost of Living in the USA for Indian Students!

Further, let’s get detailed insights on these lending institutions with their student loan requirements USA.

Banks Providers for Study Loan in USA

The offered loan amount, interest rate, moratorium period, and collateral security status of these study loan in USA providers are as follows:

Lender’s Name

Offered Parameters

HDFC Bank, India

Loan Amount: upto INR 20 Lakhs

Interest Rate: 9.55% to 13.25%

Collateral Security: Flexible

Moratorium Period: For selected courses

Repayment Period: upto 14 years

State Bank of India

Loan Amount: INR 30 lakhs

Interest Rate: upto 2% on the current base rate of SBI

Collateral Security: From loans above INR 7.5 lakhs

Moratorium Period: Course completion + 1 year, or 6 months after getting job

Repayment Period: 1-15 years

Axis Bank, India

Loan Amount: INR 20 lakhs

Interest Rate: 16.5% to 17.5%, special rates for women

Collateral Security: From loans above INR 7.5 lakhs

Moratorium Period: 6-12 months

Repayment Period: 5-15 years

Punjab National Bank, India

Loan amount: As per requirement

Interest Rate: Base rate for pursuing education at top 100 universities in world

Collateral security: Flexible

Moratorium Period: 1 year

Repayment Period: 15 years

Bank of Baroda, India

Loan amount: INR 20 lakhs

Interest Rate: 7.75% to 8.9%

Collateral security: Tangible above INR 7.5 lakhs

Moratorium Period: Course duration + 1 year

Repayment Period: upto 10 years for loans below INR 7.5 lakh and 15 years for above

Canara Bank, India

Loan amount: INR 20 lakhs

Interest Rate: 7.80% to 9.40%

Collateral Security: From loans above INR 7.5 lakhs

Moratorium Period: 6-12 months

Repayment Period: 15 years

IDBI Bank, India

Loan amount: INR 20 lakhs

Interest Rate: 8.40% to 8.75%

Collateral Security: From loans above INR 7.5 lakhs

Moratorium Period: 1 year

Repayment Period: 15 years

Avance Financial Services, India

Loan amount: Customizable

Interest Rate: 13.15%

Collateral Security: Flexible

Moratorium Period: 6 months after course, 3 months after job

Repayment Period: Flexible

Discover, USA

Loan amount: Based on GPA

Interest Rate: 2.99% to 13.99%

Repayment Period: Flexible

Wells Fargo, USA

Loan amount: 100% cost

Interest Rate: 3.21% to 6.76%

Moratorium Period: 6 months

Repayment Period: 5-20 years

LeapFinance, India

Loan amount: 100% cost

Interest Rate: 8.25% to 9.85%

Collateral Security: Not required

Moratorium Period: 6 months after job

Repayment Period: 15 years


Loan amount: INR 16-79 lakhs

Interest Rate: 7.52% to 14.98%

Moratorium Period: 6 months after course

Repayment Period: 10 years

Prodigy Finance

Loan amount: Flexible

Collateral Security: Not required

Interest Rate: 5% to 8.50%

Repayment Period: 7-20 years


Note: Moratorium period is a duration in which a borrower (student) is not obliged to make the payment. This can vary for every lending institution.

Find best education loan to study abroad

Collateral and Non-collateral International Loan Requirements

These education loans to study in USA can either be taken on a collateral or non-collateral basis. Let’s understand it in detail.

  • Collateral Loans: When banks provide a loan to a student by keeping a movable or immovable property against the loan amount is called a collateral loan. Bank representatives will evaluate your collateral, prepare a report, and provide the international student loan based on it.

What is accepted as collateral?

The banks keep any liquid assets, such as shares, bonds, FDs, and immovable properties like houses, commercial property, or land as collateral. Besides, mutual fund units, gold, life insurance policy, government securities, shares, bonds, bank deposits, debentures, etc, are also accepted as collateral.

  • Non-collateral Loans: This education loan to study in USA amount do not require the security of a property. This loan amount between INR 4 lakh to 7.5 lakh requires the signature of parents or a third-party guarantee.

However, becoming a guarantor is a big responsibility because if the borrower is unable to pay the loan amount under any circumstances, a guarantee holds the legal liability to pay instead of them.

Education Loans for Abroad Studies with Collateral

A student should select the type of loan based on the expenses covered. So consider the other costs than tuition fees like examination/library/laboratory fees, study material, travel expenses, insurance premium, study tour expenses, etc.

What is the difference between secured and unsecured loan in US

But is it this easy to take international student loans USA? No, along with the selection of a suitable loan type, the students need to follow the eligibility criteria and fulfil the document requirements.

Eligibility Criteria for Study Loan in USA

Before applying for a study loan in USA education, it is important to be eligible on the following criteria:

  • To apply from Indian banks, the student must be an Indian citizen.
  • The applicant should have a strong academic record.
  • They must seek admission to the technical or professional study programs that are job-oriented in nature.
  • They must already secure a position at a university in the USA.
  • They must be above 18 years of age.

International Student Loans, USD vs Local Currency

Next, let’s check the required documents.

Documents Required for Education Loan to Study in USA

Banks ensure beforehand if you are a capable student who can repay the loan amount. For this, they can ask for the given list of documents:

  • University Offer Letter (proof of admission)
  • Estimated cost of study (as per I-20 form)
  • Loan application form
  • Original education certificates/mark sheets
  • Documents/Scorecards of qualified exams like IELTS, TOEFL, GMAT, GRE, SAT, etc.
  • Residential proof of student and guarantee
  • IT return of the co-borrower/guarantee
  • Identification proofs and PAN card of the co-borrower/guarantee
  • Co-borrower’s proof of income
  • Passport copy of the student
  • Details of assets/liabilities of the parents/guarantee/co-borrower

It is suggested to check the document requirements with the particular bank/lender, as it may change based on the education loan for USA amount, type of collateral, etc.

Education Loan for Abroad Studies by Indian Government

How to Apply for Student Loan in USA?

Before applying for an international student loans USA, the applicant must have a clear idea about the amount of money required. Therefore, finalise the course/university to calculate the cost of living and tuition fee estimation, make a list of required documents, finalise the guarantee, and apply for the loan three months prior to the visa interview. Let’s lay bare the steps on how to apply for student loan in USA.

  1. Choose an intake for your US education and begin the loan process before the universities application procedure starts.
  2. Evaluate the various lenders/banks based on the loan amount, interest rates, repayment period, loan processing time, loan margin, processing fee, etc.
  3. Submit the crucial documents to ensure the loan consideration.
  4. Once you receive the conditional loan offer letter from the bank/lender, use it as a “proof of fund.”
  5. Share the “proof of fund” letter to get approvals from the university, visa/immigration office, financial aid institutes, etc.
  6. On showing these documents to the bank, you will be asked to sign the loan agreement document.
  7. Wait to receive the loan amount.

Spring Intake USA 2023

Receiving the loan amount is not the end of the process as students need to maintain academic scores throughout the course. Besides, they can choose pre-payment options other than the fixed instalments or consignor management (if allowed by the bank).

Taking a loan from a trustworthy institution becomes paramount if your career is involved in the process. However, if you have never done this before, worry not! You can choose Yocket premium to take assistance from our well-educated and trained counsellors. They will surely help you attain educational loans without hassle!


Frequently Asked Questions on Student Loan Requirements USA

What are the issues that one can face with education loans in USA?

What are common loan margins offered by banks for study abroad loans?

How can I repay the student loan amount?

What is the most crucial thing to consider while applying for an international study loan?

How much loan can a student get for studying abroad?

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