Why is the international students loans interest rate lower than
that of personal loans?
Interest rates are influenced by some things:
Factors of the economy: the market establishes the basic interest rates called preferential rates. They are based on many factors, such as the country’s growth rate, inflation, etc. They are constantly changing.
Expected default rates (based on historical data): it is largely based on the historical trend of loans for decades and is mainly grouped by the FICO bands.
Personal factors: they affect only the interest rate. These are credit score, credit history, income, ability to pay, etc.
Purpose of the loan: If you take out a loan for gambling, it will be a higher risk loan than what you could do if you take a home loan or a wedding.
The purpose of the loan and its use is one of the biggest factors for the lowest rates at the individual level. In the United States UU., international students loanss also have government support and there are policies to reduce the risk of default.
The most important policy for international students loanss for US citizens UU. It’s that you can not cancel a bankrupt international students loans.
Student loan interest rates 2018
Better to have a fixed or variable loan
How often does a variable interest rate change
Personal loans for students
Variable interest rate history
Why did my student loan interest rate go up
This means that even if you declare bankruptcy and insolvency on all other debts, you still owe loans to students. This is the main reason why new lenders can offer loans to students at lower rates than personal loans.