What do international student loans cover for Pakistani students?

What do student loans cover?

Student loans can be a great option to help you pay for school. In addition to scholarships or financial aid, student loans can help fund your education. You can apply for student loans from the federal government or private lenders, such as MPOWER Financing. Many students, however, are uncertain about what the student loans can cover.

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Key statistics

  1. Proportion of Pakistani students among all international students:The total number of international students in the United States for the 2023/24 academic year was 1,126,690. Pakistani students accounted for 1.0% of this total, with 10,988 Pakistani students enrolled.Source: IIE Open Doors 2024
  2. Average U.S. visa processing times for Pakistani nationals:​As of August 2024, the U.S. Embassy in Pakistan has significantly reduced visa appointment wait times. The waiting period for visa appointments has been cut from 440 days to 230 days, aiming to streamline the visa application process for Pakistani applicants.Source: Daily AUSAF
  3. Projected industry employment growth (2023–2033)The professional, scientific, and technical services sector is projected to be the fastest-growing industry sector in the United States from 2023 to 2033. This growth is primarily driven by increased demand for computer systems design and related services, reflecting the expanding need for client-based IT solutionsSource: U.S. Bureau of Labor Statistics – The fastest growing industry sector, 2023–33: Professional, scientific, and technical services

Here’s a step-by-step breakdown of common student expenses:

Tuition fees

Most international student loans are used to pay for tuition each semester. Loan funds are typically sent, or disbursed, directly to the university to be applied to your outstanding tuition balance. Any remaining amount is then passed along from the school to you, the student. Now it’s your responsibility to use these funds wisely and responsibly for other education costs. If you’re studying at an eligible Canadian school please keep in mind that an MPOWER Financing loan can cover tuition costs and other university-invoiced expenses. If you’re studying at an eligible U.S. school an MPOWER loan can often cover tuition costs along with other common fees listed below.

Housing expenses

Typically Student loans can cover the cost of living for either on- or off-campus housing. So whether you’re living in a dorm or an apartment, you can use these funds to help pay your rent. Additionally, if you have utility bills, they’re considered valid costs related to your education.

Travel

If you live off campus and need to commute to school, the cost of transportation can also be an education expense. Whether you choose to commute via a vehicle, bus, train or ride-sharing services, these are all travel expenses. The funds can also be used for flights home to Pakistan on school breaks.

Books and equipment

Books for school can be pretty expensive, and you’ll need other supplies as well, such as computers, printers, notebooks, etc. Typically student loans can be used to help pay for all of these expenses – they are required for education after all!

Miscellaneous

Some student loans can be used for any other expense related to living and studying abroad. Things like meals, clothing, cell phone plans, campus activity fees and child care if you have children.

It’s important to note that each school has a different policy specifying how funds from a student loan can be used. Some programmes will cover all student expenses, whereas others only cover tuition, food and on-campus housing. We advise students to check with their school administrator about your school’s approach to  student loans.

While it might feel exciting and overwhelming to receive a loan and have a sudden influx of funds, keep in mind these funds are enabling your long term goals. To set yourself up for future financial success, it’s essential to pace your spending and budget responsibly. Your loan will require monthly payments, so make sure you account for these as well.

Student loans are a flexible funding option for many postgraduate students! With a little bit of homework, you can figure out if they’re the best option for you.

Interested in a student loan? MPOWER offers no-cosigner loans to 500+ schools in the U.S. and Canada. Check your eligibility for an MPOWER student loan.

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FAQs


How does currency conversion impact the value of student loans for Pakistani students?

Student loans are typically disbursed in US dollars, but when budgeting, Pakistani students should account for the PKR-USD exchange rate fluctuations that might affect their purchasing power. A US$20,000 (PKR 5,726,000) loan disbursement can change in value if the Pakistani rupee depreciates, which has been trending historically. Consider setting aside a portion of your loan funds as a buffer against currency fluctuations, especially if you plan to use some funds for expenses in Pakistan during breaks or for family emergencies.

What specific expenses should Pakistani students prioritize when budgeting their loan funds?

Pakistani students should prioritize essential academic expenses like tuition and required course materials before allocating funds to housing and living expenses. Many successful Pakistani students maintain a separate emergency fund of US$1,000-US$2,000 (PKR 286,300-572,600) for unexpected expenses or travel emergencies. Focus on establishing a credit history early by paying for essential items while avoiding luxury purchases that aren’t necessary for your education, as building good credit will benefit your long-term financial options in the U.S.

Can Pakistani students use loan funds to pay for standardized tests or visa renewal fees?

Most student loans can cover education-related expenses including TOEFL, GRE or GMAT test fees if taken during your enrollment period, though tests taken before enrolment usually cannot be reimbursed retroactively. Visa renewal fees and SEVIS fees are typically considered legitimate educational expenses that can be covered with loan funds. Keep detailed records of all immigration-related expenses for both your loan provider and potential tax documentation, as some education-related expenses may qualify for tax benefits.

How can Pakistani students stretch their loan funds further while studying in the U.S.?

Pakistani students can maximize their loan funds by taking advantage of campus meal plans, which are often cheaper than eating out, using university facilities like gyms and libraries rather than paying for external memberships, and purchasing used textbooks or digital versions. Many universities offer free or discounted software licenses for students, eliminating the need to purchase expensive programs. If your status allows, consider working part time on campus (up to 20 hours weekly on F-1 visas) to supplement your loan and reduce the total amount you need to borrow.

What financial planning should Pakistani students do before accepting a student loan?

Before accepting a student loan, Pakistani students should create a comprehensive budget accounting for all expected expenses in U.S. dollars and how they compare to costs in Pakistan (for example, housing in cities like New York or San Francisco can cost five to 10 times more than in Karachi or Lahore). Research the cost of living in your specific university location, as it varies dramatically across the U.S. Develop a loan repayment strategy based on realistic postgraduation salary expectations in either the U.S. or Pakistan, considering the significant income differences between the two countries and how that will affect your ability to repay.

DISCLAIMER – Subject to credit approval, loans are made by Bank of Lake Mills or MPOWER Financing, PBC. Bank of Lake Mills does not have an ownership interest in MPOWER Financing. Neither MPOWER Financing nor Bank of Lake Mills is affiliated with the school you attended or are attending. Bank of Lake Mills is Member FDIC. None of the information contained in this website constitutes a recommendation, solicitation or offer by MPOWER Financing or its affiliates to buy or sell any securities or other financial instruments or other assets or provide any investment advice or service.

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