What we like:
International student friendly
|Fixed APR||Not disclosed|
|Variable APR||Not disclosed|
|Loan Terms||3 – 10 years|
|Loan Amounts||$2,001 – $50,000 per school year|
International student Manu Smadja and first-generation domestic student Mike Davis both struggled to find help paying for their college expenses before they first stepped foot on campus.
To open up opportunities for U.S. college attendance to other international and domestic students like themselves, they founded MPOWER Financing in 2014.
The Washington, D.C.-based lender offers global citizens who show solid career and academic potential a chance to secure personal loans for their college expenses.
On this page:
- MPOWER Financing Overview
- Rates, Fees, & Repayment
- Eligibility Requirements
- Pros of MPOWER
- Cons of MPOWER
- Refinancing MPOWER Loans
- Alternatives to Consider
MPOWER Financing Overview
What makes MPOWER unusual is that foreign students don’t need a U.S. credit score, collateral, or a cosigner to secure loan opportunities.
Although applicants don’t need a U.S. credit score to be eligible, MPOWER still performs a credit check, using credit reports to verify payment history. MPOWER says it considers academic success and career path during the approval process.
>> Read More: Student Loans Without a Cosigner
MPOWER will also report loan and payment information to the credit reporting agencies, which can help borrowers establish and build credit.
It offers loans to students from more than 190 countries who are attending college in the U.S. or Canada that MPOWER has partnered with. MPOWER also lends to students who live in the U.S.
The application process and approval for these loans can be simple and relatively quick. The money can be used just as a student would use a student loan—covering education-related expenses like tuition, room and board, food, insurance, and books.
Rates, Fees, & Repayment
Students can take out loan amounts from $2,001 to $50,000 with fixed interest rates. The rates and loan terms depend on what type of student you are:
- International graduate students can get a fixed interest rate of 12.94% APR
- International undergraduate students can get a fixed interest rate of 14.98% APR
- Domestic graduate students can get an 8.89% APR fixed interest rate
- Domestic undergraduate students can get a fixed rate of 10.91% APR
- Borrowers can qualify for interest rate discounts of up to 1.5% for fulfilling each of the following actions:
- Sign up for automatic payments (0.5%)
- Make 6 consecutive on-time payments (0.5%)
- Provide proof of graduation and employment (0.5%)
- 5% origination fee, no application fee, no prepayment fee
- Repayment term of the loan can range up to 10 years
While this might be a good financing opportunity for foreign students who want to attend school in the U.S. or Canada, MPOWER won’t accept all applicants. They carefully vet out the candidates that they assess won’t have as much of a chance of successfully paying back the loans after college.
Here are some eligibility requirements to keep in mind before applying for MPOWER’s loans:
- Must attend a U.S. or Canadian school that MPOWER is partnered with
- Must be in the last 2 years of your program of study
- International students, permanent residents, DACA students, and U.S. citizens are eligible
There are several benefits of using MPOWER loans for school, including:
- A simplified underwriting process
- A cosigner isn’t needed, which is a big help to students who have no family to rely upon, or those who have families with no U.S. credit history
- You don’t need a credit history in the U.S. to secure this loan, making it one of the few financial assistance options for foreign students
- The process is straightforward and relatively quick
- There are no prepayment penalties, which is nice for students who expect to make a decent income right after school and who want to retire their debt as quickly as possible
Although there are several pros to using MPOWER for private loans, there are cons as well, including:
- While it might be a good option for some international students, it might not be a great choice for domestic students because they might find better rates for student loans elsewhere. The interest rate is likely to be higher than they might pay with other student loan lenders.
- It might take as long as three weeks before potential borrowers receive a final determination about their loan. It might take up to 10 weeks for the funds to be disbursed.
- There is no payment-free grace period. Students are required to begin making interest-only payments shortly after the loan is received, even though they are still going to be in school at the time.
- MPOWER won’t loan money to students at every school—only certain schools are eligible. But the list of eligible schools is growing each year.
- If you are in the first or second year of a four-year program at a university, MPOWER won’t be able to issue you a loan. They only lend to students who are in the last two years of an educational program.
Can You Refinance MPOWER Student Loans?
At publishing time, MPOWER does not offer student loan refinancing. If you currently have an MPOWER student loan and you’ve established a good credit history, you might want to consider looking for student loan refinancing from another lender, especially if you can reduce your interest rate and get a favorable repayment term.
Before you refinance with any company, you should look at interest rates, the length of the loan—which will impact your monthly payment—and if it offers flexible repayment options.
Alternatives to MPOWER
Domestic students who are seeking a private student loan might look at alternatives to MPOWER because they are likely to get a better interest rateelsewhere. They should look at similar lenders and should also fill out a Free Application for Federal Student Aid (FAFSA) to see what kind of federal financial aid they can receive.
They should ask for multiple quotes before agreeing to go with a particular student loan lender. Doing some homework on different companies and rates may save thousands of dollars during the life of the loan.
Also, students should explore all the scholarship opportunities they can well in advance of attending their school. They should ideally start the scholarship search the year before they plan to begin college.
International students should check with their school to see if they’re eligible for federal student loans or other federal aid. However, for international students who don’t have as many options for education loans, they might think MPOWER is their only option, despite the higher interest rates.
>> Read More: Student Loans for International Students
On the plus side, since they’ll be making student loan repayments while they are in school, they will be working on building their U.S. credit history with each payment. That can help them gain a bit more credit history under their belt by the time they graduate. That can benefit international students who decide to stay and work in the U.S. and who will need a credit history if they want to buy a car and a house at some point.
MPOWER is one of the few options for school funding that international students might be able to secure. But they only loan money to those who they deem have the best chance academically and through job opportunities to repay their debts after graduation.
While the interest rates are high compared to some lenders, international students who have no other options for financial support might feel this is their best shot for securing money for school. They may also want to explore work-study jobs to help defray the cost of their education and reduce the amount they have to borrow.
Domestic and international borrowers should fully explore all federal and private student loan options before choosing a lender to ensure they get the best rate, which might help them save money in the long run. However, if they don’t have a cosigner and have come up empty on other financial aid possibilities, this option might work for them.4.13 MPOWER Student Loans
Author: Shannon Serpette
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