Would you like to study abroad, whether at a university in California, study for a Master’s degree in Cambridge or take language courses in Spain or Portugal? Many students dream of pursuing part of their studies abroad. A new environment as well as another school on resume is likely to offer you an unforgettable experience. It also allows you to stand out when looking for a job or a first job.
But what are the means to finance your studies abroad? And if you don’t have enough money, is it possible to get a loan?
If you wish to study abroad, it is important to first list the fees and estimate the budget you will need. You need to know, for example, how much will your education and future housing cost? You must also consider food costs. For example, a sandwich in Norway is 84% more expensive than in Belgium, and a condo in California is expensive than other parts of the country.
1. The financial possibilities
Studying abroad can quickly become expensive. If you know the total cost of your trip in advance (12 to 18 months), you can still save and try to raise at least some of that amount. Once you have a good overview of all your expenses, it is important to determine how you will fund them.
Here are the different possibilities available to you:
- Using your own funds: Can your parents help you financially to study abroad? Do you have a savings account funded through a student job or grants? Or were you employed and earning money before applying to a university? This is still the best way to pay for your stay abroad.
- Applying for a scholarship: The only drawback is that you must meet a number of criteria and complete certain formalities before you can apply. You can apply for different scholarships at different organizations depending on the country you want to study in. There are various programs such as Fulbright Foreign Student Program, Abbey Road Summer Scholarships, Civil Society Leadership Awards and Hubert Humphrey Fellowship Program offering scholarships to International students wanting to pursue education in the United States. Do not hesitate to ask about these scholarships to find out what the conditions and methods are for obtaining them.
- Combining studies and a job: Even if you have a reserve of money in your bank account, it may not be enough and you may need a little more money to finance your daily life abroad. You can, for example, try to get a part-time job abroad or try these work from home jobs in the free time.
- Finally student loan: If the above options are not available to you, you may take out a student loan as a last resort.
How can you get a loan?
Before you can obtain a loan, you must meet several requirements depending on the country you live in. In addition, the bank will examine your financial situation to see if you have any (outstanding) debts and if you are able to repay this loan.
The latter can be subscribed under your own name, or that of your parents. Students who borrow under their own name must be able to demonstrate that they have the ability to repay. If you’re not sure what type of loan is best for you, check various education loan comparison tools available online.
3. How does student loan work?
There are essentially two different types of loans available for young people wanting to study abroad: installment loans and credit lines. These types of contracts are between a financial institution (for example a bank) and the student.
Credit Line Opening:
If you want to withdraw small amounts of money when and where you want, without knowing in advance exactly how much it will be, opening a credit line can be a good choice. It can take the form of a credit card with an overdraft facility or a bank card with a line of credit or an authorized overdraft on your bank account.
With this type of credit you can withdraw money when you need it, several times throughout the term of your contract and benefit from flexibility in repayment (subject to compliance with certain conditions). This credit is also revolving: the funds you have used and repaid are immediately available again. However, with the zeroing period you must repay the credit in full at least annually or once every five years.
It is an alternative to the opening of credit. Here you take out a loan for a predetermined amount and term. You will therefore have fixed monthly repayments. Installment loans are particularly suitable when you have a substantial expense to make at once (such as the college fees). So you borrow money and then repay the interest and principal monthly.
4. Repayment of your loan
A student loan usually does not have to be repaid immediately. You may even be able to wait until you finish your studies.
However, it doesn’t make sense to wait too long to repay your credit since interest starts to accrue from day one. Knowing that your professional career will only start some time after you take out the loan, it is essential to borrow only the amount you really need for your studies and to repay them as quickly as financially possible.