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Are/Were you an American student pursuing your degree outside of the U.S?

You can count yourself amongst the 25,000+ American students annually taking advantage of the opportunity to enroll in high quality undergraduate or graduate studies at prestigious international universities. You understand the benefits of an international experience: sometimes lower cost of attendance, gaining special skills, or heightened likelihood of working for a globally oriented employer upon graduation… just to name a few!

U.S. Direct Loan Program to help finance your education

While students studying outside of the U.S. cannot acquire Pell Grants, they do have access to subsidized and unsubsidized direct loans, as well as ParentPLUS and GradPLUS loans, if their educational institution is certified to participate. Participation in the US Direct Loan Program (otherwise known as “Title IV”) is optional for foreign schools. Schools accept being subject to oversight, regular recertification and annual audits. These administrative requirements can be costly to the institution, but there are also unfortunate consequences which directly impact students as well…

The Higher Education Act and related Regulations must change for the benefit of American students enrolled in degree programs abroad!

Unfortunately, increasingly complex U.S. regulations don’t always make sense in the context of students attending international universities. This sharply curtails opportunities for Americans to enroll in schools outside of the United States or has an impact on their experience once on campus.

Here is a summary of the issues along with the proposed changes, which are reasonable while still ensuring the integrity of the Federal Student Aid program:

Students who rely on U.S. Direct Loans… IEC’s proposed remedy…
Cannot enroll in programs of study which have a distance education component… even one course or part of a course which is taught online. Doing so means they will lose all eligibility for federal loans for their entire program of study and the program of study is no longer eligible for federal loans which affects all the US borrowers in that program of study. Amend statute to clarify that eligible programs that involve on-site attendance in traditional classrooms or lab settings can include telecommunication classes for up to 25% of the program of study.
Cannot return to the U.S. to take even a single course to be recognized as part of their degree, otherwise they lose their federal loans for their entire program. Amend statute to allow at least 25% of the program of study to take place at an institution in the United States or a foreign institution not participating in the U.S. Direct Loan Program.
Cannot take a study abroad option during their degree program, if the host is a foreign school which does not also participate in the U.S. Direct Loan Program. Opportunities are shrinking as many highly prestigious schools opt not to participate in the Program simply due to their low American student enrolment. Amend statute to allow at least 25% of the program of study to take place at an institution in the United States or a foreign institution not participating in the U.S. Direct Loan Program.
Cannot enroll in any Nursing programs since foreign schools were forced to withdraw from Title IV participation due to a requirement to have a joint program with a U.S. institution. Modify statute which requires nursing programs to offer a joint degree with the U.S. nursing school, be affiliated to a U.S. hospital, and reimburse all default costs, to only apply to nursing schools with 40% or more Americans enrolled, or (as apparently intended) only apply the restriction to for-profit nursing schools.
Run the risk of losing their US Loan mid-degree as a medical student. Their program will only remain eligible for loans if 75% of their school’s medical students taking the US Medical Licensing Exam (USMLE) pass each of Step 1, Step CK and Step CS. If there are only a few test takers with a few fails, all American students immediately lose their US Loans for the remainder of their degree.

Amend the statute to calculate the 75% pass rate based on all USMLE test results, not just one step or part of the exam. Use the aggregate of all tests.


Require a statistically significant sample of test-takers before applying the 75% rule.

How is IEC helping?

International Education Council (IEC) is a non-profit association based in Washington D.C. IEC closely tracks the issues and policies affecting international education, specifically those dealing with student financial aid. IEC seeks to communicate with and influence policy maker decisions regarding U.S. financial aid programs. It provides a focused and united voice on Capitol Hill, with Embassies and the U.S. Department of Education on financial aid policy for international colleges and universities enrolling U.S. students.

Is your school an IEC member?

Despite the heightened competition by international universities for American student enrolment, our IEC member schools share a common goal: access. We believe Americans should not have to forego an international degree solely due to financial constraint. We believe U.S students should be able to access their U.S. Direct Loans (subsidized, unsubsidized, ParentPLUS and GradPLUS loans) to assist with costs of attendance. Find out here if your educational institution is an IEC member. If they aren’t listed, please encourage them to join in order to protect the interests of current and future students!

How can you help effect positive change?

As an American student or graduate, with real life experience pursing a degree abroad, your voice is both compelling and powerful. Please consider the following ways to get involved:

  • Share your stories, anecdotes and examples of negative impact during your degree abroad due to the rules surrounding your US federal loans. We relay these as anonymous stories with policy makers. Email IEC.
  • Write to your U.S. congressional representative about barriers or concerns you have or experienced. We have letter templates on Exchange/Study Abroad, Distance Education and Medical School issues to help get you started. Please copy IEC so we can also use them with key House and Senate Education Committee members who are actually re-writing the laws.
  • Join a meeting with policy makers on Capitol Hill. If you live, work or travel in the D.C. area, let us know if you are interesting in joining an IEC advocacy meeting!
Prospective Members
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Save the Date!
The 2014 Annual IEC Conference will be held on Monday, 30 June at the London University of the Arts. More details to come!

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