If you are in the Deferred Action for Childhood Arrivals (DACA) scheme, your student loan options are slightly limited. This is because the U.S. Department of Education does not make federal loans available to undocumented individuals, including DACA recipients. However, some opportunities for DACA student loans are still available through private lenders as well as financial aid programs offered by states or educational establishments. Let’s guide you through!
What to Know About Daca Student Loans
Deferred Action for Childhood Arrivals (DACA) is a kind of administrative relief that allows people who were brought to the United States as children to avoid the risk of deportation. DACA recipients are also eligible to obtain a work permit and a Social Security number.
Unfortunately, while DACA makes it more leisurely for undocumented individuals to establish lives in the U.S. free from the fear of deportation, it does not confer equal rights. And, because DACA recipients are still not legal U.S. citizens, they’re not eligible for federal student loans.
Federal Student Loans for Daca Recipients
All federal student loans, including Direct Subsidized and Unsubsidized Loans as well as Perkins Loans, demand U.S. citizenship unless you are an eligible non-citizen. DACA recipients do not naturally count as eligible non-citizens.
Because DACA recipients are not eligible for federal loans, they’re unable to profit from the perks federal loans provide, such as flexible payoff plans and student loan forgiveness.
Even though you can’t qualify for federal student loans, you may still desire to complete the Free Application for Federal Student Aid (FAFSA).
The Department of Education suggests asking a college counsellor or financial aid office to find out if you should use the FAFSA to help you apply for state or institutional aid.
5 Private Student Loans Available to DACA Recipients
If you can’t qualify for federal aid, you might want to check out the following private student loans.
|Lender||Best for…||Cosigner required?|
Students who are employed
Upperclassmen with no cosigner options
Competitive interest rates
Flexible repayment options
- APRs: 7.99% to 15.99%
- Loan amounts: From 24 months
- Loan amounts: $1,000 to $25,000
- Eligibility requirements: Be employed, have a US bank account, live in a state where Stilt operates, hold one of the following visas: F-1 and OPT, H-1B, H4, O-1, L-1, TN, J-1, DACA, or be a US citizen.
Although not legally a provider of student loans, this company provides personal loans for non-citizens residing in the U.S. But in order to qualify, you will need to be working.
There’s also no way to apply with a cosigner because your relatives won’t be able to help you unless they take the loan in their name. Such loans come in even smaller amounts than Mpower, so you may not be able to cover all of your degrees.
- APRs: 8.89% to 14.97%
- Loan amounts: $2,001 to $50,000
- Loan terms: Up to 120 months
- Eligibility requirements: F-1 student visa, attendance at partner university, and in the last two years of a degree program
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This lender is one of the few providers of student loans specializing in support for international students and recipients of DACA.
It doesn’t need a cosigner who is a U.S. citizen or permanent resident, and you don’t need a job or a good credit score.
The downside is that you have to be eligible in the last two years of your degree. And its loans come with higher rates and lower limit balances than other providers could consider.
- APRs: 4.74% to 12.49%
- Loan amounts: From $1,000
- Loan terms: Up to 20 years
- Eligibility requirements: Must be enrolled at least half-time at an eligible school with satisfactory academic progress and seeking a degree. Must be a US citizen, permanent resident, or international student.
Although you are unable to apply on your own, Discover recognizes DACA applicants on a visa as international students.
It ensures that you must register to qualify as a qualified citizen or permanent resident co-signer. Discover provides funding for your entire program, as opposed to Mpower.
If you’re a strong student, this lender could be a particularly good choice—it provides a cashback incentive when you keep your GPA above 3.0. It also has other options for expenses for graduate and postgraduate students.
- APRs: 3.24% to 11.50%
- Loan amounts: $1,000 to $295,000
- Loan terms: Up to 180 months
- Eligibility requirements: Be the age of majority in your state, be enrolled as at least half-time at an eligible school, be a US citizen or resident; have good credit; or have a cosigner with good credit
Unlike Discover, this bank also requires beneficiaries of DACA to register with a US citizen or permanent resident co-signer as international students. It offers student loans to undergraduate and graduate students, and to fund the entire degree, you only have to apply once.
This also has some of the lowest rates for DACA applicants out there. But its loans have relatively short terms, so you may want to find more manageable monthly repayments elsewhere.
- APRs: 2.75% to 10.22%
- Loan terms: Up to 240 months
- Eligibility requirements:
Sallie Mae offers a wide range of student loans for everyone in their profession, from undergraduates to doctors.
Although you may apply for qualifying with a cosigner who is a U.S. citizen or permanent resident, it does not allow the exemption of a cosigner. If your legal status changes, this allows you to transfer the loan to your name.
The loans often come with more flexible repayment options than other private lenders may consider, such as allowing you to postpone your loans when you go back to school or during an internship.
Can I Get a Student Loan as a DACA Recipient?
Sure, you can receive student loans from private lenders, your school, and probably your state as a DACA recipient.
But you’re probably not eligible for federal student support—including federal student loans—because it’s only open to U.S. citizens, permanent residents, and eligible non-citizens.
Where Else Can I Find Student Loans?
There are a couple of other places where you may be able to find student loans besides private lenders.
Your State or Local Government
Although you may not be able to qualify for federal assistance, you may be eligible for student loans from the Department of Education of your state or city.
These often come with more competitive rates and conditions than private lenders, as well as more flexible repayment options. All students usually get the same payment. And you don’t usually have to apply to register with a cosigner.
Many universities offer students institutional loans that may be accessible to beneficiaries of DACA. They tend to have comparable rates and terms to state options, and typically all students get the same deal. These may come in lower amounts, but they are primarily intended to complement state and federal assistance.
Other Financial Aid Options
Before you apply for student loans, you might want to look into the free aid available to you first. This includes:
- Scholarships. After the Dream Act was passed, many organizations, such as TheDream.US and Golden Door Scholars, started offering scholarships specifically designed for DACA students. Your school and state might also offer their own scholarship programs, which are usually based on merit.
- Grants. Private organizations, your school, and your state and local governments might also offer need-based funding you can qualify for if you’re a low-income DACA recipient.
Take advantage of online resources like those provided by United We Dream, which has a searchable list of financial aid designed specifically for DACA students on its website.
3 Steps to Finding Available Financial Aid
Want to limit how much you need to borrow? Follow these steps to ensure you find all of the free aid you’re eligible for:
- Research scholarships and grants while you’re in high school. Get started early, and enlist the help of your college adviser or guidance counsellor to keep you aware of deadlines.
- Submit the FAFSA and CSS Profile ASAP. Even if you aren’t sure you qualify, submit both of these financial aid applications to maximize your options. You might be surprised to find that you are actually eligible for federal aid.
- Talk to your school’s financial aid office. Once you have an idea of where you’re going, reach out to the financial aid office to find out what other options you might have missed. Stay in touch to stay on top of new opportunities.
The fees associated with applying to college can cost nearly $5,000 for some families, but they don’t have to. You may be eligible for fee waivers if the cost of taking the SAT, uploading the CSS profile, and applying to multiple schools is in the way.
You can also take advantage of free tutoring programs in your community or high school to avoid expensive test preparation courses. Speak to your college counsellor at your high school to learn about other options available to you.
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The Bottom Line
While for most DACA applicants, federal and some private student loans are off the table, there are still several options available. But first, you may want to look into free assistance. You may have more access to scholarships and grants, and you don’t have to pay them back.