Ultimate Guild to Apply for MPOWER Study Loans
Are you an international student seeking a loan to study abroad? Consider exploring MPOWER Financing, a specialized financial institution offering loans to support your education in the United States and Canada. In this article, we will be showing you all you need to know about Mpower Finance study abroad loans among other relevant information.
About MPOWER Finance
MPOWER Financing is a company in Washington, D.C., helping students around the world with loans for education in the United States and Canada. They offer education loans designed to cover tuition fees and other related expenses for students pursuing higher education. MPOWER aims to assist students who may face challenges in accessing traditional financing options due to their international status.
They use a special system to look at your credit and potential future earnings. They work with over 400 universities in more than 200 countries. The team at MPOWER includes people who were once international students, and they not only give loans but also help students with money advice and career support. Recently, they added 40 more universities to their list, so now they work with over 400 schools in the United States and Canada. If you’re at one of these new schools, you can use MPOWER’s scholarships and loans to help pay for your education.
MPOWER provides full funding, covering up to $50,000 (USD) for a two-year period. If a student’s chosen program costs more than $50,000, they’ll need to explain and show proof of how they plan to cover the extra amount. The financial institution gives $25,000 in the first year and the remaining $25,000 in the second year. If the total expenses for tuition and living exceed this amount per year, the student must provide documents showing a shortage of funds in the form of liquid assets.
To fund the second year, students need to apply again for an education loan during their second year of studies. It’s important to pay simple interest every month to build a credit history in the USA and Canada.
Features of MPOWER Finance
1. No requirement for co-signer or collateral: MPower Finance provides education loans based solely on a student’s future potential, eliminating the need for a co-borrower, collateral, or credit history.
2. Availability of Top-Up Loans: MPower Finance allows students to apply for a top-up education loan if they have previously availed of a loan elsewhere but still fall short of course expenses.
3. Repayment Period: The repayment term for an education loan is up to 10 years, beginning six months after graduation.
4. Moratorium Period: During the moratorium period, students must pay simple interest to build their credit history and prevent the loan amount from growing.
5. Support Letter: MPower Finance provides a visa support letter for students to obtain their I-20, crucial for securing a U.S. student visa.
6. Sanction Letter: Upon finalizing the university, MPower Finance issues a sanction letter for visa purposes, valid for up to 6 months.
Advantages of Choosing MPOWER Finance
The benefits of choosing an education loan from MPower Finance include:
1. Loan Amount: Aspiring international students can secure an unsecured education loan of up to $50,000.
2. No Collateral or Co-signer: The entire education loan process does not require collateral or a co-signer, simplifying the overall process.
3. Flexibility: Students have flexibility in choosing the loan amount based on their specific needs.
4. Easy Repayment Policies: MPower Finance offers convenient and easy repayment policies to support students in managing their loan obligations.
5. Credit History Building: By availing of an education loan from MPower Finance, students can build a U.S. credit history and score. This can be beneficial when applying for apartment rentals, credit cards, and other financial services in the USA.
6. No Upfront Fees: After the approval of the overseas education loan, students are not required to pay any upfront fees.
7. Useful Loan Letter: The loan approval letter can be used for securing the I20 and assisting in successfully completing the visa interview process.
Disadvantages of MPOWER Financing
Everything that has an advantage has a disadvantage. The following are the few disadvantages of choosing an MPOWER Finance loan:
1. Limited Availability: Eligibility for undergraduate or graduate loans with MPOWER is restricted to students within two years of their expected graduation date, and they must be enrolled in one of the institutions partnered with MPOWER. This limited availability may pose challenges for students attending other universities.
2. Limited Repayment Terms: Unlike many lenders that offer flexible repayment terms spanning five to 20 years, MPOWER provides only a 10-year repayment term. This may limit borrowers’ options in tailoring their repayment plans based on their financial circumstances.
3. No In-School Deferral: Unlike conventional lenders, MPOWER does not offer an in-school deferral period where students are not required to make payments until six months after graduation. Instead, borrowers must start making interest payments 21 to 60 days after the loan is disbursed. This requirement may create financial pressure on students while still pursuing their education.
Who is Eligible for a MPOWER Financing Loan?
To check if you can get a loan, the best thing is to do an eligibility check. This check makes sure you meet the basic requirements to start applying. However, they’ll only decide if you can get a loan after their team looks at your full application and the documents you provide.
Here are the requirements to apply:
1. You’re currently accepted or studying at a school in the U.S. or Canada supported by MPOWER.
2. You’re close to finishing your program, within 2 years of graduating.
3. You want the money within the next 12 months.
4. While in school, you live in either the U.S. or Canada (the country of your school).
5. You’re accepted or enrolled in a program that qualifies. You can find a list of qualifying programs here.
6. You’re not a citizen of a restricted country or under individual sanctions.
The good news is, you don’t need a credit history or someone else to co-sign for you.
Which Canadian Schools does MPOWER Support?
Canadian schools supported by MPOWER include over 20 institutions. Some notable names among them are:
1. York University
2. University of Alberta
3. University of Toronto
4. University of Waterloo
5. Vancouver Island University
These are just a few examples, and MPOWER collaborates with various other colleges and universities across Canada. To check if your college or university is on the list whether in US or Canada, visit their eligibility website.
How to Apply for an MPOWER Loan?
The application process with MPOWER is entirely online and generally takes around 30 minutes. Here’s a step-by-step guide to apply for the loan:
1. Ensure you meet the eligibility criteria before starting your application.
2. Complete the online application, and have a valid photo ID ready.
3. Within 10 business days, you’ll receive a response. If it’s a conditional offer, submit the necessary documents to confirm the information.
4. Upload all required documents.
5. Wait for final approval. Once approved and all documents are submitted, MPOWER will provide a visa support document within 10 days.
6. For U.S. schools, MPOWER requires approval from your school to disburse the funds. This process may take two to six weeks.
Required Documents for an MPOWER Finance Loan
1. Two valid photo IDs (passport, driver’s license, national ID, voter’s ID, or another government-issued photo ID).
2. A copy of your CV.
3. Proof of home country address (bank statements, a letter from the university, utility bills, signed lease agreement, etc.).
4. Standardized test scores or a waiver from your university if none is required.
5. English proficiency test scores or a waiver from your university if none is required.
6. Letter of acceptance or past transcripts.
7. Estimated cost of attendance (this can be a screenshot from your school’s website).
8. Proof of DACA status (if applicable).
How Does MPOWER Review Your Application?
The review of your application occurs in two stages. The Initial Review, which takes approximately 10 business days, may result in a conditional offer if we can verify the information provided. If you don’t receive a conditional offer, it doesn’t mean you won’t be approved; they will need to review your documents first.
After receiving all your documents, their credit team conducts a final review, taking another 10 business days. In some cases, they might request more documentation to better understand your situation.
During this process, your application is assessed for the requested amount and any additional funds they can approve. Initially, you’ll be approved for the requested amount, but they will inform you if there are additional funds they can approve.
MPOWER Interest Rates and Terms
MPOWER’s loan offerings include a 0.25 per cent discount for enrolling in automatic payments, and its minimum advertised rates already incorporate this discount. While it previously provided additional discounts for consecutive on-time payments and proof of graduation and employment, these are no longer mentioned on MPOWER’s website.
Here are the current rates:
Undergraduate student loans:
– Variable rate: N/A
– Fixed rate: 14.75% to 15.01% APR
Graduate student loans
– Variable rate: N/A
– Fixed rate: 13.72% to 13.98% APR
Student loan refinancing:
– Variable rate: N/A
– Fixed rate: 12.23% to 12.48% APR
MPOWER’s rates are noted to be higher than the industry average for student loan rates. Unlike most lenders, MPOWER offers only a single, fixed APR, with or without the autopay discount. This means that even those with excellent credit may face an above-average rate. However, it’s worth noting that many lenders do not cater to international students at all. Therefore, MPOWER provides an option for those in need of financial assistance in the education loan market.
MPOWER Fees and Penalties
MPOWER imposes an origination fee of 5 per cent for both graduate and undergraduate student loans, whereas refinancing a previous student loan incurs a smaller 2 per cent origination fee. It’s worth noting that many student lenders have eliminated such fees.
Additionally, MPOWER enforces late payment and returned check fees, although the specific costs for these fees are not specified.
MPOWER Repayment Terms and Grace Period
MPOWER’s loans come with a fixed 10-year repayment term, which might be restrictive, especially for individuals seeking to refinance or those with different repayment preferences.
The grace period structure is unconventional; while you aren’t obliged to make principal balance payments until six months after graduation, MPOWER does require borrowers to commence interest payments within 21 to 60 days after the loan is disbursed.
In contrast, some lenders offer more flexible options, allowing borrowers to choose between deferring the entire loan cost while in school, making small flat payments, or opting for interest-only payments. For instance, competitor Prodigy Finance permits full-time students to defer all payments while in school and for six months after graduation.
What does the MPOWER Loan Cover?
Student loans are a helpful option for covering the costs of education, along with scholarships or financial aid. Usually, the loans are first used to pay for tuition each semester, with any remaining funds sent to the student. These funds can be used responsibly for other education costs like housing expenses, covering rent for on- or off-campus living, and utility bills. If you commute to school, transportation costs, whether by vehicle, bus, train, or ride-sharing, can also be covered. Additionally, funds can be used for books, equipment like computers, printers, notebooks, and other necessary supplies for education. Your student loan is versatile and can cover miscellaneous expenses like meals, clothing, cell phone plans, campus activity fees, and even child care if needed.
Conclusion
MPOWER Financing gives loans to students from Nigeria and other countries worldwide who are studying in the United States. You can borrow between US$2,001 and US$100,000, and you have 10 years to pay it back. The best part is, you don’t need anyone else to sign with you or give any collateral. It’s a straightforward way for international students to get financial support for their education in the U.S.
