International Student Loan Repayment Plans: Everything You Need to Know

by | Dec 28, 2022 | Finance

Getting an international student loan is one of the best ways to finance your studies in colleges and universities abroad. International student loans are a great option to fill in funding gaps after exhausting scholarships, financial aid, and personal resources.

In the past, international student loans weren’t accessible for a majority of African students aspiring to study abroad. Many African students studying abroad relied on scholarships, financial aid from their schools, and family resources.

Thankfully, currently there are several lenders offering international student loans – many of which African students are eligible for. A lender of note is 8B Education Investments – the first lender providing education loans exclusively for African students in colleges and universities abroad.

Before you decide on taking loan to fund your studies abroad, it’s important to learn about international student loan repayment plans. What are the common repayment plans? What are the pros and cons of each plan? Which repayment plan is best for you?

Understanding international student loan repayment plans is crucial. It helps you to figure out exactly how much the student loan might end up costing you. With information on repayment options, you can also plan on how to comfortably make monthly loan repayments.

To answer all your questions and help you make an informed decision, let’s explore everything you need to know about international student loan repayment plans.

Common International Student Loan Repayment Plans

When comparing loan offerings from different lenders, you’ll realize that each one of them has its set of repayment options. The most common repayment options you’ll come across include:

  • Immediate repayment
  • Deferred repayment
  • Interest-only repayment
  • Partial repayment

In the sections below, let’s each one of the international student loan repayment plans above. We’ll also explore the pros and cons of each plan to provide insights on which plan might work best for your needs.

Immediate Repayment Plan

This plan means that you start making full loan payments as soon as the loan is disbursed. If you opt for an immediate loan repayment plan, you’ll be making payment while in school.

The plan is great for students who are working while studying abroad. However, being required to make payments while in school might not be ideal for students who don’t have any source of income while enrolled in school.

The immediate loan repayment results in the greatest savings for borrowers. Choose it if you have the financial means to make full repayments while in school.

Deferred Repayment Plan

A deferred repayment plan means that student borrowers only have to start making payments after graduation and at the end of their loan’s grace period.

While you will pay nothing while enrolled in school, the loan will still continue accruing interest during that period. With this international student loan repayment plan, you might end up paying more than with other plans.

The biggest upside with a deferred repayment plan is that you won’t have to worry about repayments while in school – which will allow you to concentrate on your studies. That can be a big stress reducer.

Interest-Only Repayment Plan

Just like the immediate loan repayment plan, an interest-only repayment plan means that you’ll have to start making payments as soon as the loan is disbursed. You’ll be making monthly loan payments while in school.

However, as the name suggests, you’ll only make payments on interest. The plan makes your monthly payments more manageable and keeps your loan balance from increasing while you’re enrolled in school.

It can, however, be disappointing to keep on making payments without seeing any reduction in your principal loan amount. The biggest upside with this plan is ensuring that your loan balance doesn’t grow while you’re in school.

Partial Repayment Plan

With a partial repayment plan, you’ll also have to make payments while in school. However, unlike interest-only repayments, your payments will be fixed. For instance, your payments might be set at $30 or $50 a month.

Having a fixed partial interest repayment plan makes it easier to budget to make your payments each month. The plan’s upside is that it keeps your loan balance from growing as fast as it would if you were not making any payments at all. However, you’ll still owe more at graduation than the amount you borrowed.

Which International Student Loan Repayment Plan Is Best?

Unfortunately, there’s no cut and dry answer as to which is the best repayment plan for your international student loan. That will largely depend on your personal financial circumstances.

For instance, if you have a source of income while studying abroad, the option is the immediate repayment plan. While it’s stressful to have to make payments as immediately after the loan is disbursed, the plan is the best for reducing the total cost of your loan.

However, you might want to explore other more affordable in-school payment options such as interest-only or partial repayments. If you don’t want to worry about international student loan repayments while in school, go for a deferred repayment plan.


Are you looking for scholarships or student loans to finance your education abroad? Find a scholarship through our extensive scholarship database and compare different loans on the 8B student loan marketplace.

Share This