In an email to staff and faculty yesterday, officials at the University of Pennsylvania’s Wharton School shared details about a new custom loan program developed for international students without U.S. co-signers.
Citibank, the main source of these loans in recent years, has exited from the business as a result of the ongoing economic crisis, leaving Wharton and many other schools scrambling to identify alternatives for students. At Wharton, the solution will take the form of a custom loan program with Digital Federal Credit Union, which will cover tuition and living expenses for international students and will not require a U.S. co-signer.
The new loans will carry an interest rate of prime plus 3 percent, and borrowers can reduce the rate 25 basis points farther by arranging for automatic repayments. In order to provide these attractive rates, Wharton has agreed to share some of the potential default risk with the lender.
The program is available to incoming international students as well as to current first-year international students for their second year of study. The email, sent by Dean Thomas Robertson and Vice Dean Anjani Jain, indicated that more details of the program will soon be announced by Wharton’s Financial Aid Office.
As for loan programs for domestic students and international students with U.S. co-signers, Penn’s Student Financial Services (SFS) Office is currently reviewing several proposals and will provide a list of approved lenders for both federal and private loan programs within the next few weeks.
