Where to find interest-free student loans
Interest-free student loans may sound like a dream for many students, but they do exist.
Student loans from the federal government’s “unsubsidized” Stafford student loan program could force students to pay up to $10,000 more than they borrowed because of interest rates. Interest-free loans, on the other hand, are ideal because borrowers are only required to pay back the exact amount that they borrowed.
Here is a list of some of some charities and organizations who are currently offering interest-free loans to students:
- Abe and Annie Seibel Foundation – Almost 800 Texas residents who are enrolled in a full-time program at a college or university in their state can apply for a $4,000 loan from this organization. The student must have someone co-sign their loan, (specifically an adult with good credit), so if the student fails to pay back their loan on time, their co-signer will then take full responsibility for payments. In order to qualify the student should be a high school graduate from a Texas high school. Application deadline: February 28th.
- Bill Raskob Foundation – This organization is a “small family foundation” and offers student loans worth a minimum of $1,000 per year; however most of the loans average between $3,000 and $6,000 per year. Approximately 60 sophomores, juniors, or seniors are eligible, but they will not accept your application if you are an undergraduate student in your first year of study, or if you are pursuing more than one degree. Application deadline: April 1st.
- Central Scholarship Bureau of Maryland – Nearly 150 students who are residents within the state of Maryland can apply for loans worth up to $10,000 per year. Applicants must be a full-time student and have a cumulative GPA of at least 2.0. Also, their family must have an adjusted gross income of less than $90,000, but each applicant will be evaluated individually. In order to obtain the funds, the student must have a co-signer. Application deadline: May 10th.
- Evalee C. Schwarz Charitable Trust for Education – Students who have grades and scores that are in the top 10 percent of their class can apply for loans worth a minimum of $5,000 or a maximum of $15,000. In order to qualify the applicant must be a graduate, undergraduate or high school senior, and they must be attending a school within their state, however there are some exceptions listed on their website. Application deadline: April 10th.
- Jewish Free Loan Association – Even though these loans can total up to $3,500, specialized programs may have higher limits. These loans will be given out to about 650 residents in the Los Angeles area regardless of their faith. Their co-signer must be a resident of California, older than 25, and have a “steady source of income” as well as an “established credit record.” Applicants must be a permanent resident of Southern California, however some exceptions do apply. There is no application deadline.
- Leo S. Rowe Pan American Fund – Citizens of Latin American or Caribbean nations who are interested in studying in the U.S. can apply for this loan, however the applicants must return to their home countries within a year after graduation. The loans can total up to $15,000, and after returning to their home country they must “apply their knowledge and training” to their community, and also “continue to promote cultural exchange and development in the region.” Students studying in any academic field besides English as a Second Language (ESL) can apply for the loan, and they must have a valid visa which allows them to study as a full-time student in the U.S. The co-signer must be a U.S. citizen or be a member of an institution which has been accepted by the committee. There is no application deadline.
- Military Officers Association of America Scholarship Fund – Nearly 1,500 students who are children of active or retired military members can receive up to $5,500 from this organization. In order to qualify the applicant must have a grade point average of at least 3.0. These loans are renewable annually for up to five years if the student is enrolled in a full-time undergraduate study. However, the organization reports that “assistance is available” for students who have not yet earned an undergraduate degree. Application deadline: March 1st.
If you do not qualify for any of the above loans, try contacting your school’s financial aid office and/or department chair and ask if they offer interest-free loans at your school.