Private education loan rates for Pakistani students

For Pakistani students who want to study in the U.S. or Canada, private student loans are often the key to financing the cost of education. One year at an American university, for example, can cost as much as US$70,000 (PKR 19,600,000) or more. Since Pakistani students aren’t eligible for financial aid from the U.S. or Canadian governments, private loans are typically the best financial option. However, it’s important to research private education loan rates carefully and to choose the international student loan that works best for your financial and educational goals.

1. Total number of Pakistani students in the U.S. (2023-2024):In the 2023–2024 academic year, over 11,000 Pakistani students were enrolled in the United States – a record high and a steady increase from the previous year. This placed Pakistan 16th globally for student enrolment in the US.Source: Tribune Pakistan
2. Year-over-year growth – Pakistani students in the U.S. and Canada (2022-2023 to 2023-2024):Leading study destinations are witnessing significant increases in Pakistani student enrolments, with particularly high demand for postgraduate studies. In the United States, there were 10,165 Pakistani students in 2022-2023, marking a 16% increase from the previous year, while in Canada, the number surged to 4,750 students in 2023, reflecting a 101% increase from the previous year.Source: ICEF Monitor
3. The proportion of Pakistani students among all international students:The total number of international students in the United States for the 2023-2024 academic year was 1,126,690. Pakistani students accounted for 1.0% of this total, with 10,988 Pakistani students enrolled.Source: IEE Open Doors 2024

Private education loans are loans made by banks, credit unions and other financial companies rather than by a government or university. Private education loan rates vary widely among lenders, and rates are typically slightly higher than loans subsidised by the government. Consequently, it’s important to carefully research your education student loan, understand the terms and calculate the total cost before making your decision.

There are two types of private education loans: loans with a cosigner and loans without. A cosigner is someone who agrees to repay the loan if you’re unable to make payments at any point. Usually, lenders require a cosigner to be a citizen or resident of the U.S. or Canada. They must have good credit and stable income. Cosigners for Pakistani students are typically relatives or family friends who live in the country and who are invested in the student’s success. For students that don’t have this kind of financial support, no-cosigner loans are a better option.

With a no-cosigner loan, private education loan lenders base their decision on a student’s academic history and future earning potential, rather than their current financial status. Lenders may also take the student’s field of study and the reputation of the university into account, as well as the student’s academic standing. With a no-cosigner loan, Pakistani students can remain financially independent and avoid putting a cosigner’s finances and credit score at risk.

Whether you choose a loan with or without a cosigner, finding the best private education loan rates is the key to minimising the cost of borrowing money. The interest rate and terms on your loan determines how much you’ll need to repay in addition to the original amount you borrowed. Here are some things to keep in mind as you compare private education loan rates and loan offers:

• Type of student loan interest rate: Fixed-rate student loans mean your payment will be the same month to month, since the interest rate never changes. With variable-rate loans, the interest rate is tied to the financial markets and your payments may fluctuate as the cost of borrowing money changes. Fixed-rate loans offer inflation-proof predictability, while variable-rate loans offer potential savings but potentially higher costs as well.
• Length of the term: The term of your loan is the amount of time you have to repay it. Ten years is standard, but some lenders offer loans with shorter or longer terms. A shorter term means your payments will be higher but you’ll pay your loan off faster and save money on interest. A longer term means smaller monthly payments, but the total cost of your loan will be higher.
• Fees: It’s important to understand the fees associated with your loan and to add them to the total cost when comparing offers. These may include origination fees, application fees, insurance, prepayment penalties and other fees charged by lenders. Understanding and adding these fees will help you calculate the annual percentage rate (APR) or the total cost of your loan. Knowing the APR will help you compare loans.
• Repayment options: Another variable that may affect private education loan rates is when repayment begins. Some lenders ask you to begin payments immediately while you’re in school. This can help to reduce the total cost of the loan by paying it off faster. Other lenders may allow you to wait until graduation or even offer a grace period after graduation before you must start monthly payments. This can ease your financial situation while you’re in school, but it will also add to the total cost of the loan.

Follow these steps to find the right lender with the best private education loan rates for Pakistani students.

• Decide on a cosigner or no-cosigner loan. Your first step in choosing an education loan provider is to decide whether you want a loan with a cosigner or whether you’ll want a no-cosigner loan that enables your independence. For many Pakistani students, a no-cosigner loan is more practical due to the lack of U.S. or Canadian connections.
• Compile a list of lenders: The internet is a great resource for finding lenders. Your friends, family and social media network can also provide referrals to lenders they’ve used to finance their studies. Check with the admissions department of the school you wish to attend, as they may have suggestions as well. Additionally, seek out recommendations from other Pakistani students who have successfully secured loans for studying abroad.
• Review eligibility requirements: Each lender may have slightly different requirements, so it’s important to be clear about which loans you’re eligible for before you put in the time to prepare an application. Some lenders may have specific criteria for Pakistani students, so be sure to verify your eligibility.
• Compare rates and terms: Review the private education loan rates of each lender as well as the fees, terms and repayment options. Compare the annual percentage rates (APR) of loans, which is the interest rate plus any other fees. The APR provides a way to conduct an apples-to-apples comparison of loans (and their cost) available to you. Remember to also consider currency exchange rates when calculating the total cost in Pakistani rupees.
• Consider the extras: While private education loan rates are important, they’re not the entire story. Some lenders offer more student loans services and benefits for Pakistani students, including things like scholarships, visa support and career services. These benefits can be valuable and worth a slightly higher interest rate.

MPOWER Financing provides no-cosigner international student loans for global citizens, including Pakistani students, pursuing a degree in the U.S. or Canada. Founded by international students, MPOWER offers financial assistance for postgraduate students, along with loans for DACA students and refugees/asylees.

As a leading lender for Pakistani students, MPOWER offers:

• Competitive private education loan rates: MPOWER fixed-rate loans are available at competitive interest rates ranging from US$2,001 (PKR 560,000) to US$100,000 (PKR 28,000,000) and students can earn a 0.25% interest rate reduction through automatic payments. Loans may help pay for all the costs of education in the U.S., from tuition, books and fees to housing, meals and transportation.
• Streamlined application and approvals: With MPOWER, you can check eligibility in 30 seconds, file an application easily and get a quick conditional loan offer as well.
• Services to support student success: Pakistani students who choose MPOWER have access to a wide range of scholarships, visa support services, career services and more.