What are DACA Loans for Students? Here’s the Complete Guide!

The cost of higher education is huge and financing higher studies can pose challenges for non-resident individuals living in the US. This category of people includes recipients of Deferred Action for Childhood Arrivals (DACA) status. DACA holders are ineligible for federal student loans and funding, owing to which it becomes difficult to pursue higher education. However, there are alternative resources accessible to DACA recipients and undocumented students who study in USA. While federal and state assistance may not be available, certain states offer DACA loans at the state level. Additionally, various private student loans and scholarships are also accessible to DACA students. 

This blog explores considerations for DACA students during the college application process and clarifies the availability of federal and state assistance, as well as private loans. 

What is DACA?

Deferred Action for Childhood Arrivals is an immigration policy in the USA. It was introduced in 2012 under the Obama administration. It offers temporary protection to immigrants from deportation. Additionally, DACA status also provides employment authorization to certain undocumented people who came to the USA as children and are popularly known as “Dreamers.”

DACA Eligibility Criteria

Before learning about DACA loans for students, let us learn about DACA eligibility criteria. To be eligible for DACA, individuals must meet the following criteria:

• They must have arrived in the USA before they turn 16
• They must have been residing in the USA since 15th June 2007.
• They must have been living in the United States on 15th June 2012
• They must have been residing in the US at the time of making their DACA request.
• They must be currently in school, have graduated from high school, 
• They must have procured a GED certificate
• They must not be a felon or convicted of a significant misdemeanour 
• They must not pose a threat to national security.

It’s important to note that DACA does not guarantee legal permanent residency (PR) or US citizenship. It is only a temporary measure to allow eligible individuals to live and gain employment in the States without the fear of deportation. However, the living and working of DACA recipients are subject to certain conditions.

Can DACA Students Get Federal Loans?

DACA students are not eligible for federal student loans. Additionally, they cannot avail of Direct Loans from the US Education Department. Federal student loans are only granted to US Citizens, eligible non-citizens, and permanent residents. This is because they are eligible for Free Application for Federal Student Aid (FAFSA). 

DACA holders are considered ineligible non-citizens for federal loans or financial aid or DACA loans for students. This implies that they do not qualify for federal loans, grants, or work-study programs. This restriction can be attributed to the immigration status requirements which were laid down by the Obama administration. 

Also Read: Unsubsidized Loans: What You Need To Know!

Can DACA Students Get State Financial Aid?

Even though DACA recipients are not eligible for federal loans they can apply for state financial aid for higher education. As DACA students are eligible for social security numbers, they can receive state financial aid from the following states:

• Washington
• Connecticut
• Oregon
• New Jersey
• Maryland

State Financial Aid under DREAM Act

Additionally, several states of the US also offer DACA loans for students under their DREAM Act. These states are as follows:

• Washington
• Maryland
• California
• Texas
• New Mexico
• Connecticut
• Minnesota
• Oregon
• New Jersey

Also Read: Bank Of America International Student Account: Details, How To Open, Benefits

Private DACA Loans for Students

DACA students can apply for private student loans through private lenders or banks. These loans might mandate a co-applicant who is a citizen of the U.S. or a permanent resident of the country. Therefore, it is helpful to compare different lenders to know about the best terms and conditions and interest rates. Some of the private DACA loans are as follows:

College Ave

Here are the salient features of College Ave student loans:

• College Ave is a private student loan provider in the United States.
• This organisation offers loans to students of undergraduate, graduate, and professional courses.
• It provides competitive interest rates and numerous loan repayment options.
• It does not charge any application fees
• It provides flexible repayment terms
• It allows borrowers to make full payments 
• It has a co-applicant release option for eligible beneficiaries
• College Ave Offers features online tools
• It also has online resources for loan management.
• It has a simplified application process 

Sallie Mae

Given below are some of the important properties of Sallie Mae DACA loans for higher education:

• It disburses student loans for undergraduate courses, graduate programs, and professional studies.
• It offers both private and federal student loans 
• It has flexible repayment options, such as deferred and IDR plans.
• It provides competitive interest rates
• It has no origination fees
• It does not charge prepayment penalties
• It has multiple repayment term options

MPOWER Financing

Key features of MPOWER Financing student loans are as follows:

• This private lender offers loans to international students studying in Canada and the US
• For availing of loans, no co-applicant or collateral security is mandatory
• A borrower is evaluated on their/her/his future earning potential and not on credit history
• It has competitive interest rates
• It has flexible repayment options, 
• It has a quick and easy loan approval process.
• The organisation disburses DACA loans directly to the educational institution.
• MPOWER Financing has partnered with an array of top universities in the world and colleges.

Also Read: Education Loan In USA For International Students

FAQs

To learn more about student loans and international money transfers, stay in tune with Fly Finance. To answer all your study abroad finance queries, connect with our experts at 1800 572 126.