Studying abroad is an exciting opportunity to enrich your education and broaden your perspective, but the cost can be a major hurdle. If you have dreams of exploring the world during your college years, student loans can offer a practical solution to make it happen. Whether you’re an undergraduate or graduate student, there are several loan options specifically designed to help finance your journey. Below, we break down how loans for study abroad students work, along with other ways to fund a semester or year overseas.
Table of Contents
Key Points
• Student loans, including federal and private options, can generally be used to finance approved study abroad programs.
• Federal student loans offer favorable terms but require the foreign institution or program to meet specific eligibility standards.
• Private student loans can cover up to the full cost of attendance, but eligibility is credit-based and may require a cosigner.
• Beyond tuition, student loans for studying abroad may cover the adjusted cost of attendance, including travel expenses, visas, and international health insurance.
• To minimize debt, students may want to first pursue grants and scholarships, which do not have to be repaid, before turning to loans.
Can You Use Student Loans to Study Abroad?
Yes, you can use student loans to study overseas. If you study through a program approved by your U.S. university, your existing financial aid package (including federal student loans) usually “travels” with you. If you enroll directly in a foreign university, you can still use federal loans if that school participates in the U.S. federal student loan program.
Private student loans can also typically be used for study abroad programs, provided the school is accredited or recognized by the lender.
Here’s a closer look at the main loans for study abroad students.
Federal Student Loans for Studying Abroad
Federal student loans are often the first option students consider to help cover the cost to study abroad due to their fixed, relatively low interest rates and borrower protections.
Federal student loans for studying abroad include:
• Direct Subsidized Loans: These are available to undergraduates demonstrating financial need. The government pays the interest while the borrower is in school at least half-time and for six months post graduation.
• Direct Unsubsidized Loans: These are available to all undergraduate, graduate, and professional students and are not based on financial need. Interest begins accruing immediately upon disbursement.
• Direct PLUS Loans: These are available to parents of dependent students and require a credit check.
In the past, graduate students could also access Direct PLUS Loans, but these are no longer available to new borrowers as of July 1, 2026.
The major advantage of federal loans is flexibility in repayment, including income-driven repayment and potential forgiveness programs. You apply for federal loans (as well as other forms of financial aid) by filling out the Free Application for Federal Student Aid (FAFSA®).
Private Student Loans for Studying Abroad
Private student loans are offered by banks, credit unions, and online lenders and can often be used for international education. Private loans may cover up to 100% of school-certified costs, including tuition, travel, and living expenses, minus other aid. Rates may be fixed or variable.
You apply for a private student loan for overseas study directly with the lender, which can typically be done online. Unlike federal loans, private student loans are credit-based, which means you may need a cosigner (such as a parent or another adult with a good credit rating).
Private loans can be useful when federal aid falls short, but they come with trade-offs. Interest rates may be higher, and repayment options are usually less flexible. It’s important to shop around, compare lenders carefully, and understand the long-term cost.
Recommended: Guide to Private Student Loans
International and Specialized Lenders
If you’re enrolling directly in a foreign institution that doesn’t participate in U.S. federal aid or private lender programs, you’re not necessarily out of options. There are a number of international and specialized lenders that provide loans for study abroad, targeting both U.S. students studying internationally and international students studying in the U.S. or other countries. Some of these loans may not require a U.S. cosigner, though interest rates may be higher.
Grants and Scholarships
Before taking on debt, it’s worth exploring grants and scholarships. These forms of financial aid do not need to be repaid and can significantly reduce your reliance on loans. Scholarships and grants for studying abroad can come from your school, non-profit organizations, government agencies, and private companies.
You can apply for state and federal grants by completing the FAFSA. Many schools also use the FAFSA to determine their own institutional aid. Outside scholarships and grants typically require a separate application. You can learn about opportunities through your school’s finance aid office and online scholarships databases. Here are some useful resources:
• Institute of International Education (IIE): The IIE offers a comprehensive database of scholarships for students seeking to study overseas.
• BigFuture: BigFuture’s scholarship search tool is a large database of grants and scholarships, including those that are specifically for studying overseas.
• Go Overseas: Go Overseas offers a database of scholarships specifically for students planning a semester or year abroad.
• U.S. Department of State: The government maintains a database of foreign government scholarships available to American students that want to study overseas.
How Are Student Loans for Studying Abroad Different?
Financing an international education involves several unique factors that make it different from domestic borrowing:
• Adjusted cost of attendance (COA): Unlike loans for domestic college, study abroad options typically allow financial aid offices to recalculate your COA. This adjustment may raise your borrowing limit to account for international-specific costs.
• Stricter eligibility requirements: To qualify for federal or private loans, your chosen program or host institution must usually meet specific accreditation standards.
• Currency exchange risks: Because loans are typically disbursed in your home currency (e.g., USD), a shift in exchange rates can reduce your actual purchasing power once you arrive.
• Higher ancillary costs: Your loan amount must often cover significant extras beyond tuition, such as international airfare, student visas, and specialized travel insurance.
• Fewer provider choices: Not all lenders offer products for overseas education, which may limit your ability to shop around for competitive interest rates.
How Much Do Student Loans for Overseas Study Cover?
Your borrowing limit depends on the lender, your financial need, and your estimated expenses. Student loans are often designed to cover the total “cost of attendance” (minus any financial aid), which typically includes the following categories:
Tuition
Tuition for studying abroad can differ from staying at your home campus, but it is not always more expensive. While costs vary by program, destination, and exchange rates, they are often comparable to home campus rates. Enrolling directly in an international university can often be more affordable, though you may need to budget separately for costs like housing and health insurance.
Living Expenses
Living costs can vary significantly by country and city. A study abroad loan generally covers:
• Housing (dorms or apartments)
• Food and groceries
• Utilities
• Local transportation
Travel Expenses
International study typically involves unique costs that aren’t part of domestic programs. Many loans allow you to use funds for:
• Round-trip airfare
• Visa application fees
• International health insurance
• Initial relocation costs
Some programs include these expenses in their total cost, while others require separate budgeting.
Recommended: Is Studying Abroad Worth It?
Graduate Study Abroad Loans
Graduate students can utilize federal student loans for international study, provided the foreign institution participates in the Federal Direct Loan Program. Currently, graduate students can access Federal Direct Unsubsidized Loans, which are awarded regardless of financial need, to help pay for grad school.
As mentioned, Grad PLUS Loans (which traditionally covered up to the full cost of attendance) will no longer be available to new borrowers starting July 1, 2026. To bridge any remaining financial gaps, you might turn to private graduate student loans. Many private lenders approve funds for study abroad if you are enrolled in a program sponsored by a U.S.-based university. In addition, specialized international lenders offer loan products specifically designed for graduate students pursuing degrees overseas.
Tips for Choosing the Right Study Abroad Loan
Selecting the right loan requires balancing affordability, flexibility, and long-term impact. Here are some practical tips:
• Start with federal loans: Federal student loans usually offer the best terms and borrower protections. Once you’ve exhausted all federal aid options, you might turn to private loans to fill in any remaining gaps in funding.
• Compare multiple lenders: If you decide to take out a private loan, be sure to research your options, looking at interest rates, repayment options, and fees, which can vary significantly across lenders.
• Avoid prepayment penalties: If possible, choose a lender that does not charge fees for paying off your loan early. Settling your debt ahead of schedule can save a substantial amount of interest.
• Confirm school and program eligibility: Lenders often maintain specific lists of accredited or pre-approved universities. Before applying, ensure both your institution and your specific study abroad program are eligible for funding.
• Borrow conservatively: While it is tempting to accept the maximum amount offered, it’s wise to only borrow what is absolutely necessary. Minimizing your initial debt can significantly ease future financial pressure.
• Seek repayment flexibility: Look for “safety net” features such as deferment options or hardship forbearance to protect yourself during unexpected financial stretches
Private Student Loan From SoFi
Student loans can make studying abroad possible, but they require careful planning. From federal and private loans to scholarships, there are multiple ways to fund your education overseas. By understanding what loans cover — like tuition and living costs — you can build a realistic budget and avoid financial strain. Ultimately, the goal is to borrow responsibly so that your international experience becomes a rewarding investment in your future.
If you’ve exhausted all federal student aid options, no-fee private student loans from SoFi can help you pay for school. The online application process is easy, and you can see rates and terms in just minutes. Repayment plans are flexible, so you can find an option that works for your financial plan and budget.
FAQ
Can I use student loans to receive a degree from an international school?
Yes, but eligibility depends on the school’s accreditation and participation in certain loan programs. For U.S. federal student loans (like Direct Subsidized and Direct Unsubsidized Loans), the foreign institution must participate in the Federal Direct Loan Program. Private student loans are often more flexible, but the international program must typically be sponsored or affiliated with the student’s U.S. school. Always confirm your school’s eligibility before applying.
Can you get a federal student loan for overseas study?
Yes, you can get a federal student loan for overseas study. The key requirement is that the foreign school you attend must be approved by the U.S. Department of Education and participate in the Federal Direct Loan Program.
If you study abroad through a program approved by your U.S. college, your existing federal financial aid package generally remains available to you. Always check with your U.S. school’s financial aid office and the international institution to confirm eligibility.
Are there special loans for studying abroad?
You typically don’t need a specific “study abroad” loan; standard student financing usually covers international programs. Your options include:
• Federal student loans: You can generally use federal funding to pay for studying overseas if your home university approves the program or the foreign school participates in the U.S. federal loan program.
• Private student loans: Many major lenders allow you to apply your funding toward approved international travel and tuition costs.
• International/specialized lenders: Some niche lenders specifically serve students earning full degrees overseas.
What are other ways to finance studying abroad aside from loans?
Other financial options besides loans include:
• Grants and scholarships: These are forms of gift aid that do not need to be repaid. You can find them through your home university, the study abroad program, and online scholarship databases.
• Personal savings: You can use your own money or money saved through summer and part-time jobs while attending your home school.
• Fundraising: Some students use crowdfunding platforms or organized events to raise money for their international experience.
Do you need a cosigner to get a loan to study abroad?
Whether you need a cosigner depends on the type of loan and your financial profile. Federal student loans do not require a cosigner. Private loans are credit-based, and undergraduate students typically need a cosigner (like a parent or another adult with a good credit score) to meet the lender’s credit requirements and secure a competitive interest rate.
SoFi Private Student Loans
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