International students at The Johnson Graduate School of Management are still scrambling to find student loans in the wake of the announcement last fall that companies like CitiAssist and Sallie Mae would terminate their “no-cosigner” student loan programs as a result of the financial crisis.
While this specific loan crisis is generally not a concern for U.S. students due to the availability of federal loans, international students heavily rely on such loans, which do not require them to find a cosigner within the U.S., to finance their education.
“It’s just the international students [who are affected]. Our domestic students will be fine; they’ll be able to get federal loans,” said Lisa Pastrick, financial aid counselor at The Johnson School.
For the past two years, international students made up nearly a quarter of the Johnson School’s MBA program. Of the 272 enrolled MBA students in the class of 2010, 73 percent are U.S. citizens.
As of now, the Johnson School does not have a definitive solution to the problem. Its website states “the only U.S. loan option available to international students is with a credit-worthy U.S. citizen co-signer or U.S. permanent resident co-signer.” However, the school reassures its students that it is “currently investigating loan options for international students without a U.S. co-signer and will provide information as it evolves.”
Approximately 10 to 15 percent of current international students at The Johnson School have depended on the “no-cosigner” student loans. Tuition at the Johnson School for the 2008-2009 academic year costs $44,950 — an amount which many international students may have difficulty paying without a loan.
“We’re working with several multinational banks and financial institutions to secure a ‘no-cosigner’ loan program,” said Randall Sawyer, direction of admissions and financial aid at the Johnson School.
The Johnson School is specifically bargaining with three banks. According to Sawyer, contracts have nearly been secured for two of these banks and the third one is pending.
“I can say with a very high degree of confidence that we’ll have a ‘no-cosigner’ loan program in the very near future,” he added.
Nevertheless, the number of international students who applied to the two-year MBA program at the Johnson School for the class of 2011 dropped by 20 percent. To encourage accepted international students to enroll, The Johnson School is offering regular scholarships to international students for the first time.
The Johnson School is not the only business school struggling to find a solution to the loan crisis, according to BusinessWeek. Leading business schools that used to offer the CitiAssist loan program, such as the Harvard Business School and the Wharton School at the University of Pennsylvania, are trying to facilitate new programs to help their international students. One school that has found a replacement lender is the Sloan School of Management at the Massachusetts Institute of Technology.
Prabhushankar Rajamani ’10 is one of many two-year international MBA students at the Johnson School affected by the loan crisis. Rajamani, a graduate of PSG College of Technology in India, was attracted to The Johnson School’s immersion program, strong finance program and small, collaborative student community.
Rajamani had been financing his MBA education at Cornell with the CitiAssist loan but now has been placed in a difficult position with the program’s termination.
“I’m using the ‘no-cosigner’ option for the first year, and my second year financing is still unclear. The financial crisis is affecting us in more than one way –– fewer jobs, increased costs and no international student loans,” he stated in an e-mail.