Many Indian students need financial help to pursue a master’s degree at the University level in the USA, but cannot apply for a student loan. They are forced to take a loan in India and pledge their home as collateral.
Starting the journey
Inspired by such experiences two persons have founded a startup, Stilt, which offers personal loans to immigrants. Additionally, its original focus was on overseas students as well as H-1B workers, but it now includes DACA recipients and other categories of immigrants.
Stilt originated in 2016, and its founders are Priyank Singh and Rohit Mittal. It has an eye for work history; education; job offers and payment of timely subscription services, of the applicant for determining the credit score. Based on an analysis, Stilt, based in San Francisco, offers unsecured personal loans at the interest rate of 13 percent. It is double the rate of loan availed by a federal graduate student, but the promoters feel that it’s lesser than other available options to immigrants. Other loans consider the credit history/permanent resident status.
Still has several borrowers from 150 countries. Furthermore, it has received $250 million in loan applications. It has offices in India also. Moreover, it has since hired special attorneys to avoid any legal issues.
The other options available are Credit unions, the Self-Help Federal Credit Union, and the Latino Credit Union, focusing on immigrants and also some low-income borrowers. Stilt helps many students to access financial tools which are away from them. It is a great option to refinance and pay back loans in India. Also, the risk and fear of family homes exist, when one cannot make the monthly payment. Moreover, the loan relieves them of heavy responsibility.
Research of some senior Business Economists suggests that non-naturalized immigrants are underbanked. Some of them do not have a bank account.
Some other details
Getting identification as social security or a tax Identity number is a challenge. This allows a person to pay taxes not considering the immigration status. Furthermore, the next step is getting a U.S. bank account and building up the credit history.
Additionally, applicants use the money from Stilt for paying foreign student loans, and also for moving to the US or for paying the legal costs of submitting the application for permanent residence. Even the H-1B visa holders can use the funds for relocating their families to the USA. This will cover the expenses related to security deposits and furniture. Finally, Stilt shows that immigrants are safe for the lending operations not considering their lack of credit history. Finally, this helps them to stay in the US and lead a happier life.