Toy plane on folded map and full money jar with sign reading Travel

Top 5 Questions to Ask Before Taking Out a Loan to Study Abroad

You may need some financial help to make your study abroad dreams come true. Before you take out a loan, consider these five things to make a smart choice.

Students who study abroad in college have the unique opportunity to experience a new culture, expand their worldview, and make lifelong memories. But studying abroad isn't cheap—in fact, it can be quite expensive! From airfare and tuition to the cost of sightseeing trips and souvenirs, there are a lot of expenses associated with studying abroad. And while there are scholarships and grants that can offset some of those expenses, you may be eyeing study abroad loans to help cover the remaining cost. These are the things you should consider first before taking on more debt.

5 questions about study abroad student loans

Depending on the university and program you choose, you may be eligible for several types of student loans. However, study abroad loans can vary greatly in terms of interest rates, fees, and eligibility criteria. Before taking on any debt, ask yourself the following questions.

1. How much does the program cost?

The average cost of an entire semester abroad is about $15,000. However, some programs can be significantly more expensive. For example, a program through Semester at Sea starts at $26,874. When considering the cost of studying abroad, make sure to budget for expenses beyond your tuition and airfare, including meals, transportation, and health insurance. Knowing exactly how much your study abroad experience will cost will help you determine how much you need to borrow.

Related: 7 Scholarships to Help You Study Abroad

2. Did you use gift aid?

Before turning to student loans, exhaust all your options for grants and scholarships. Unlike student loans, which must be repaid with interest, you don’t have to repay gift aid. You can also stack grants and scholarships to reduce the need for loans. There is even gift aid specifically designed for study abroad. Gift aid opportunities range from large awards for program costs to smaller amounts that cover textbooks and incidental expenses. Here are a few examples:

  • Benjamin A. Gilman International Scholarship: Students who have received Federal Pell Grants may be eligible for the Benjamin A. Gilman International Scholarship, which offers selected students up to $5,000.
  • Boren Awards: Students planning to study abroad for 12 weeks or more may qualify for scholarships of $12,500, with the majority of eligible students in Language Study programs.
  • Foundation for Asia Pacific Education: US and Canadian citizens studying abroad can qualify for a scholarship of $500–$1,500 but must be studying in a program-approved country.

3. Will the program help you with your current studies or future goals?

While you may have always dreamed of seeing the Sistine Chapel or walking the Great Wall of China, it’s important to think about how your study abroad experience will help you academically and professionally. Otherwise, it may be a very expensive extended vacation. Before taking on any debt, double-check with your academic advisor to ensure your program will count toward your degree. For instance, programs that build professional skills such as foreign language fluency tend to be worthwhile investments.

Related: 5 Tips to Make the Most of Your Study Abroad Experience

4. What types of loans are available?

Depending on the type of program you choose, you may be eligible for several different types of loans. Common study abroad loans include:

  • Federal student loans: If you’re studying abroad at a university for a semester, you may be eligible for federal student loans. Federal loans usually have lower interest rates, currently 4.99% for fixed-rate loans, and more flexible repayment terms than other loan options. To qualify, you must fill out the FAFSA.
  • Private student loans: If your program isn’t eligible for federal loans—or if you need more money than you can get—another option is private student loans. Many private lenders offer loans for students studying abroad, and you can usually borrow up to the total cost. Generally, fixed-rate private loan interest rates range from 3.22%–13.95%, but undergraduate students usually need a cosigner unless they meet the lender’s credit and income requirements.
  • Personal loans: If you’re entering a nontraditional program or need additional financing to cover travel or living expenses, a personal loan is another option. Compared to student loans, personal loans have fewer restrictions on their use. However, they tend to have higher interest rates and shorter repayment terms. While most student loans have 10–15 years of payments, personal loans usually have terms of five years or less. Undergraduate students will also likely need a cosigner for this type of loan.

5. How much debt are you willing to take on?

Even if you only plan to study in another country for a semester or year, you still have to worry about how to pay for the rest of your college career. If you take on too much debt, you could struggle to make ends meet after graduation. Student loans can take 10 years or more to repay, so they can be a heavy burden for a long time. As a general rule, the Consumer Financial Protection Bureau recommends borrowing no more than what you expect to make during your first year in a salaried position. For example, if the average starting salary for your field is $50,000, you should take out no more than $50,000 in loan debt. If studying abroad would cause you to exceed that guideline, you may want to revisit your plans or consider other ways to finance your study abroad experience.

Related: Don't Fret the Debt: 5 Ways to Conquer Student Loans

If you want to study abroad, you should carefully consider how it will affect your overall college costs. Look for ways to reduce your expenses to limit the need for student loans, and talk to representatives at your school to learn more about how to navigate the financial aid process. If you need to take on more debt to study abroad, make sure you understand all the terms and conditions of your loan before you sign on the dotted line.

Ready to start planning your study abroad adventure? Use our Scholarship Search tool to find more gift aid!

Like what you’re reading?

Join the CollegeXpress community! Create a free account and we’ll notify you about new articles, scholarship deadlines, and more.

Join Now


About Maxime Croll

Maxime Croll is a Senior Director and Insurance Product Manager at Previously, she was the Director of Product Marketing at CoverWallet—a commercial insurance start-up—and also helped launch NerdWallet's personal insurance business. Maxime has contributed insurance insights and analysis to Forbes, USA Today, The Hill, and many other publications.


Join our community of
over 5 million students!

CollegeXpress has everything you need to simplify your college search, get connected to schools, and find your perfect fit.

Join CollegeXpress


High School Class of 2023

CollegeXpress helped open me up to many colleges that fit my interests. I’m only a sophomore in high school, so I like having a lot to look at, and CX does a great job of picking colleges that meet my wants. It's a great website that I'll continue to use until it comes time for me to apply for colleges. I also like that it notifies me through email with options to look at. Thanks CX!

Kory Gilbertson

Kory Gilbertson

High School Class of 2022

CollegeXpress has helped me explore my views on college in that "why do I wanna go to a certain school" way. It’s helped me explore the best fits in all of these outstanding choices. All these college admission counselors can access my accolades showing them how I could help their college. This source of information helps me show these admission directors who I am and what I'm interested in. Thanks to this platform, my experience for education will be better than most, and I'm so grateful for all that it has provided for me.

Rose Kearsley

Rose Kearsley

High School Class of 2021

CollegeXpress has seriously helped me out a lot, especially when it comes to scholarships and studying for tests like the ACT. I also really love the financial help. It’s a little harder to pay because I live with a family of eight, so any help is appreciated. Thanks for this opportunity!

Fabiola Rodriguez

Fabiola Rodriguez

High School Class of 2022

CollegeXpress helped me on my journey to get to the school of my first choice by showing me all the options I have. I didn’t know of the College of Southern Nevada until I went on this website, and it helped me look for other choices and compare what colleges would be right for me.



High School Class of 2021

CollegeXpress showed me that Western New England University was a great match for me both with curriculum and location. CollegeXpress is an excellent resource both future and current college students.

College Matches

Colleges You May Be Interested In

New York University

New York, NY

Marymount University

Arlington, VA

Centre College

Danville, KY

Vermont State University

Randolph Center, VT