International students attending universities in the U.S. are at a disadvantage when it comes to student loans. Coming from a different country, international students typically will not have a credit score or credit history as is required by many loan applications. And, in many cases, they also have no collateral, jobs, or cosigners either.
Of course, it makes sense that these students would not have a U.S. credit history. But fixing that issue is not easy or quick. And, for most international students, trying to find a creditworthy U.S. cosigner would be an exercise in futility.
But MPower Financing wants to bridge the student loan gap for international students and DACA recipients. Keep reading our full review to learn how they are able to offer private student loans to students in the U.S. and Canada without requiring cosigners, collateral or credit history.
- Student loan financing for international students and DACA recipients
- No credit history or co-signer required
- Interest rates and fees may be higher than some alternatives
MPower Financing Details
MPower Student Loans
Min Loan Amount
Max Loan Amount
Variable and Fixed
Who Is MPower Financing?
MPower Financing is a private student loan provider for international students. It was formed in 2014 and is based in Washington, DC. It’s CEO, co-founder, and board chairman is Emmanual (Manu) Smadja. The company has raised $229.5 in funding with its last round raising $9 million on June 8, 2020.
“The number of international students coming to North America has more than doubled over the past decade, and with our borderless financing we can enable even more bright minds to come,” Smadja told Fintech Futures.
What Do They Offer?
Instead of using traditional loan qualifications, MPower Financing focuses on the student’s academic success and career path for determining creditworthiness. Here's how their loans work.
School And Student Eligibility
There are currently more than 350 schools in the U.S and Canada that are eligible for MPower Financing student loans. To use MPower Financing, you must attend one of these schools. You must already be admitted to your school before applying for an MPower student loan.
No cosigner is needed (or even accepted). Currently, they will lend to students from over 190 countries. And while their loan program is geared towards international students, it should be noted that it's open to domestic students as well.
Loan Terms And Fees
Loans are disbursed directly to schools instead of the student. Students must start paying loan interest 45 days after the loan has been disbursed.
After the student graduates, they’ll get a 6-month grace period. However, interest-only payments must still be made during the grace period. Once the grace period ends, full payments must be made.
Loans must be paid back within 10 years. Students can borrow from $2,001 up to $50,000. You’re able to receive up to $25,000 per academic year. There is also a 5% origination fee, which is rather high.
Interest Rates And Available Discounts
The interest rate on MPower Financing student loans is fixed. As of June 24, 2020, APR rates range from 8.89% and 14.97%. By enrolling in autopay (U.S. bank accounts), you’ll receive a 0.5% discount. Meaning, if your rate is 8.89%, it will reduce to 8.39%.
There are additional discounts that can be obtained. Once you’ve made 6 consecutive auto payments, you’ll receive another 0.50% discount. Finally, another 0.5% discount can be had by showing proof of graduation and employment. That’s a total of 1.50% off your interest rate. For a 8.89% rate, it will reduce to 7.39%. There are no fees for paying the loan off early.
Behind the scenes, MPower Financing is using Nelnet as its loan servicer for U.S. students. Ascendant FX is used as the payment processor for Canadian students who need to make payments in Canadian dollars.
Are There Any Fees?
Yes, there is a 5% loan origination fee (one-time charge) plus the interest per your loan terms. On a $10,000 loan, the origination fee would be $500. There are also late fees of 4% of the payment amount or $5.00, whichever is less. Also, there is a returned payment fee of $5.00.
How Do I Open An Account?
One of the best places to start with MPower Financing is to complete their eligibility check. If it looks you meet their basic requirements, you can begin the full application process and provide the necessary documents.
Is My Money Safe?
Yes - since you are receiving a loan, there is no money to deposit. MPower Financing uses encryption on its website and any payments are made through ACH transfers using bank-grade encryption.
Is It Worth It?
For international students and DACA recipients that have few alternatives for financing an American education, MPower Financing provides reasonable loan terms. Borrowers also get 2 years of interest-only payments plus another 6 months after graduation before full payments kick in.
However, you might find MPower Financing interest rates and/or fees to be higher than other private student loan options. To make sure you're getting the best deal, be sure to get quotes from two or three more lenders that specialize in international student lending. These are our top international student loan lenders of 2020.
MPower Financing Features
Min Loan Amount
Max Loan Amount
Lifetime Maximum Borrowing Limit
Up to 24 months
Up to 24 months
More than 350 schools in the U.S. and Canada
United States: Nelnet
Canada: Ascendant FX
MPower Student Loans Review
- Loan Options
- Customer Service
- Rewards and Perks
- Rates and Fees
- Ease of Use
MPower Financing offers student loans in the U.S. and Canada to international students without cosigners, collateral or credit history.
- No-cosigner or credit history required
- Interest-only payments during school
- Up to 1.50% of available rate discounts
- High origination fee
- Can’t fully defer payments during school
- Only one loan term option (10 years)
Robert Farrington is America’s Millennial Money Expert® and America’s Student Loan Debt Expert™, and the founder of The College Investor, a personal finance site dedicated to helping millennials escape student loan debt to start investing and building wealth for the future. You can learn more about him here and here.
He regularly writes about investing, student loan debt, and general personal finance topics geared towards anyone wanting to earn more, get out of debt, and start building wealth for the future.
He has been quoted in major publications including the New York Times, Washington Post, Fox, ABC, NBC, and more. He is also a regular contributor to Forbes.