Financial Aid for DACA Students

In 2012, then-President Barack Obama signed an executive order titled Deferred Action for Childhood Arrivals (DACA), which opened up many opportunities for undocumented students.

Under DACA, individuals who meet conditions can stay in the U.S. and get a work permit. They enjoy two years of protection from deportation and the opportunity to attend colleges, universities, and trade schools. This guide explores how DACA students can secure financial aid for higher education.

Can DACA students get financial aid? 

DACA benefits do not include access to federal financial aid programs, including federal student loans and grants or work-study funding. Undocumented students can qualify for other types of financial aid, including state-sponsored student loans or grants, school-based aid, and scholarships. 

Public or private organizations may offer scholarship funding. Eligible students may apply for multiple awards to cover college education costs. Here are some of the top scholarship options to consider for DACA recipients:

• Golden Door offers scholarships for undocumented DACA students, as well as mentorship throughout college and beyond with internships and professional development. Applicants must have a demonstrated financial need and live in the U.S. for at least four years before applying.
• TheDream.US National Scholarship Award will cover tuition and fees up to $16,500 for an associate degree and $33,000 for a bachelor’s degree. Over 80 partner colleges in multiple states participate in the program.
• TheDream.US Opportunity Scholarship is designed for DACA students who live in targeted, locked-out states where they’re ineligible for in-state tuition rates. The award provides up to $80,000 to cover a bachelor’s degree’s tuition, fees, on-campus housing, and meals.

Federal and state DACA financial aid for DACA students

While federal aid is unavailable to DACA students, state aid may be an option. Minnesota, for instance, has a specific DREAM Act application that awards eligible students a Minnesota State Grant worth almost $2,000 that doesn’t need to be paid back. 

Contacting your school’s financial aid office or state student aid commission can give you an idea of what’s available. Remember that certain types of DACA financial aid may be first-come, first-served.

Some states may require you to complete the Free Application for Federal Student Aid (FAFSA) to see whether you’re eligible for state aid. In that case, you will need a Social Security number to start the process. Consult the federal guidelines for instructions on filling out the tax and residence information.

Private student loans for DACA students

If you’ve considered scholarships, grants, and state aid, your next option is private student loans. Banks, credit unions, and online lenders offer these loans. Qualification often depends largely on the borrower’s credit history, and a U.S. citizen or permanent resident may be required to cosign on the loan.

Here are five lenders that offer student loans for DACA students. Note the information below is based on the lenders’ undergraduate loans. All lenders also offer graduate student loan options.

College Ave: Best for DACA students with a Social Security number

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LendEDU rating: 5 out of 5

• Cosigner is required
• Choose your repayment terms
• Borrow up to 100% of the cost of attendance

College Ave is an innovative private student loan lender that was founded by former Sallie Mae executives. At College Ave, students can apply for undergraduate, graduate, and career loans. Loans are also available for parents who want to help their children pay for school.

Students can choose from fixed or variable-rate loans, with no origination fees or application fees. There are multiple repayment options, and no payments are required while you’re in school. A rate discount is available with autopay enrollment.

College Ave does not list any specific eligibility requirements for DACA students who are interested in private loans. A Social Security number and qualified cosigner are required for all borrowers, so if you don’t have one, you won’t be eligible to get a loan through College Ave.

Sallie Mae: Best for cosigned loans

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LendEDU rating: 4.8 out of 5

• Loans offered for multiple study programs
• Reduced interest rate when you choose in-school repayment
• No prepayment or origination fees

Sallie Mae is an established name in the student loan space. Founded in 1972 as a servicer of federal student loans, Sallie Mae is now one of the top private student loan originators in the U.S. Loans are available for undergraduate and graduate study as well as career training.

The minimum loan amount is $1,000 and it’s possible to borrow up to 100% of the cost of attendance, less any other financial aid received. You can apply if you’re enrolled full-time, half-time, or less than half-time, taking classes online or on-campus.

Sallie Mae offers DACA student loans, though the website doesn’t specify any set requirements needed to apply or be approved, other than a cosigner. The cosigner must be a U.S. citizen or permanent resident who meets minimum credit score and income guidelines.

Earnest: Best for borrowers with less-than-perfect credit

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LendEDU rating: 4.7 out of 5

• Skip a payment once per year
• 9-month grace period
• Cosigners must meet specific requirements

Earnest specializes in low-interest student loans for undergraduate and graduate study. The company was founded in 2013 as a merit-based lender, meaning credit history isn’t the only factor considered for approval. Cosigners are encouraged, though not required for DACA students.

DACA students applying with a cosigner must ensure the cosigner meets certain requirements. Specifically, Earnest looks for cosigners who are U.S. citizens or permanent residents, have a minimum credit score of 650, have never filed for bankruptcy, make a minimum of $35,000 annually, and live in a state in which Earnest operates.

The maximum loan amount is $250,000, and you can choose from multiple repayment terms. You’ll enjoy up to a nine-month grace period before you have to begin making full payments on your loans. You also have the option to skip a loan payment once per year.

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MPOWER Financing: Best for international and DACA students

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LendEDU rating: 4.6 out of 5

• No cosigner, collateral, or credit history requirement
• Repay your loan in any currency or location around the world
• Only offers loans to students attending one of 350 approved schools

MPOWER Financing offers private student loans to international students who enroll in U.S. or Canadian schools. DACA recipients and refugees are also eligible to apply for loans.

Borrowers have to be admitted to an approved school to qualify for funding. Loan amounts range from $2,001 to $100,000 and can be used to fund virtually any degree program. Most importantly, there are no cosigner requirements for these loans.

DACA students may be eligible for loans through MPOWER Financing if they’re undergraduate or graduate students within two years of graduating or beginning a 1- or 2-year program. There are no collateral, credit history, or cosigner requirements but you do have to be admitted to an approved school.

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Ascent: Best for multiple student loan options

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LendEDU rating: 4.4 out of 5

• Cosigned and non-cosigned loans for DACA students
• Borrow up to 100% of the cost of attendance
• No application, origination, or disbursement fees

Ascent offers scholarships and undergraduate and graduate student loans for DACA students. Cosigned loans are available to DACA students with creditworthy cosigners who are U.S. citizens or permanent residents. You can apply without a cosigner if you meet income and credit requirements. 

Note that cosigner release is unavailable for loans where the primary borrower is not a U.S. citizen or permanent resident. 

DACA students will also need to provide documentation from the U.S. Department of Homeland Security/U.S. Citizenship and Immigration Services (USCIS) that indicates their DACA status doesn’t expire within six months of the end of the enrollment period for which they’re requesting loan funding. 

What happens if I can’t get approved for a DACA student loan?

If you can’t get a private student loan, you might have additional options for DACA financial aid. These include personal loans and private-sector scholarships, some even geared toward DACA students.

Scholarships 

Scholarships are a terrific option when exploring DACA financial aid because you don’t need to repay them. Therefore, it’s to your advantage to apply for scholarships before applying for loans or when you complete the FAFSA if you’re eligible.

Here are some tips to keep in mind as you search for DACA scholarships:

• Some awards may be need-based, while others are merit-based.
• You may need to be enrolled or planning to enroll at an accredited school to qualify.
• Awards can be location-specific, meaning you need to live or attend school in certain counties or regions to be eligible.
• Scholarships may require you to submit a personal essay as part of your application.
• Certain awards may require you to have at least one parent who is representative of a specific ethnic group.

If you’re unsure where to look for scholarship funding, your school’s financial aid office may be able to offer some resources to help you start your search. 

Personal loans

They aren’t private student loans, but you might qualify for a personal loan as a DACA student. A personal loan is a lump sum you can borrow for almost any need. You repay the loan over time with interest according to the lender’s schedule.

Certain lenders offer personal loans to nonresidents; some even have DACA-specific loans. Personal loans can provide funding for school when you’ve exhausted other options, but the rates you pay might be higher compared to private student loans. Depending on the lender, you may also pay origination fees for the loan.

Repayment terms tend to be shorter, and loan limits may be less than what you could get with private student loans. Similar to DACA student loans, personal loans may require a cosigner for approval if you’re not a U.S. citizen or permanent resident. And unlike student loans, cosigner release usually isn’t an option for personal loans.

State-based DACA financial aid programs

The lack of DACA financial aid at the federal level has prompted many states to offer discounted tuition rates to undocumented students. At the time of writing, 24 states and the District of Columbia have provisions that extend in-state tuition rates to DACA students. See if your state is on the list.

Here are a few tips to keep in mind as you look for state-based DACA financial aid programs:

• Some states/schools may extend in-state tuition rates to undocumented students through a Board of Regents decision rather than a formal policy.
• Certain states actively block access to in-state tuition rates for undocumented students. 
• A handful of states exclude undocumented students from enrolling at any postsecondary public institution altogether.

If you’re unsure what options exist in your state, you can contact your school’s financial aid office for help. You can also connect with your state’s financial aid commission or department of higher education to discuss what kind of financial aid may be available for DACA students.

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