Compare personal loans for American expats

Living abroad is a life-changing experience. But it’s not uncommon to need just a bit more cash to get by.

Unexpected opportunities often arise while you’re an expat — as do unexpected medical expenses — but borrowing money as a foreigner is a bit complicated. We give you a rundown of your options to get cash as an American abroad.

Can I get a loan while traveling abroad?

Yes, but it might be more difficult than get a loan back home — and your options are limited. While the most common types of financing available to American expats are mortgages and student loans, it’s not impossible to find loans for general personal use.

Getting an online loan

The simplest and quickest way to get financing while abroad is to apply with an online lender based in the US. These providers tend to have less rigorous requirements and can typically get you money faster than a bank will.

You often need to have a US account for this option to work — most online lenders aren’t keen on sending money to an overseas bank since payments could take as long as a month to go through. You might also need to have a US address or work for a US employer.

Here are a few online lenders that might approve a loan while you’re traveling.

Getting a personal loan from your home bank

Taking out a loan with your US bank could be option for expats that still have a US bank account accessible overseas. That’s because some banks only require you to be a US citizen — not a current resident — to qualify for a loan.

More likely than not, you won’t find online if your bank cares where you live. Give your bank a call to see if you qualify, and ask what the process involves. It could take a while to get approved if you’re employed by a foreign company.

You might be able to get around a bank’s residency rules by applying with another person living in the US. Finding a coborrower can increase your chance of being approved.

If your bank offers international banking options, take advantage of them — it could also help you qualify for a loan.

Compare top US banks offering personal loans

Getting a loan from a local financial institution

In some countries, it’s possible for a US citizen to take out a personal loan from a local financial institution. Loans typically depend on such factors as the country’s financial regulations, its relationship with the US and the demand for US expat financing.

You won’t want to go for this option unless you’re a legal resident with a bank account or you’re trying to buy real estate — otherwise, you might have trouble qualifying. Even if you do qualify, make sure you fully understand how lending works in that country, and how to pay back your loan. Don’t sign anything without running it by a translator unless you’re a native speaker with a firm grasp of financial jargon.

Lina opens an account in France

Moving to Paris was a childhood dream of Lina’s. So after graduating from college, she took on a teaching job in the City of Light before starting her career. She applied for an HSBC Expat account and opened a local account in France to make sure she could easily transfer money back and forth.

Everything went smoothly until the day her apartment was broken into. It was a nightmare: The burglar took her computer and an expensive camera she needed for work. She didn’t have insurance to cover the loss, and the police told her there wasn’t much she could do to get it back. Altogether, it cost Lina about $4,000 to replace.

Not wanting to borrow money from her family, she looked at her personal loan options. It was hard enough opening a bank account as an American in Paris, so she quickly ruled out French banks, going with a US online lender instead. She applied to prequalify with three lenders and got the best offer from Laurel Road: a $4,000 loan with a 6.75% APR.

After Laurel Road disbursed the money into her US account, Linda transferred it to her French bank account and replaced her stolen items. To guarantee on-time repayments, she transferred part of her salary to her US account a few days before payments were due.

Bottom line

Getting a loan abroad complicates an already seemingly complicated process. It’s possible to get one, but you might have to convince a lender to work with you — it’s just not something they do very often.

You almost certainly need a working US bank account to qualify for a loan from a US-based lender. If you decide to look locally, qualifying can depend on factors like your residency status and employment.

Make sure to compare your options and look into other financial solutions — such as borrowing from friends or family — before you apply with a particular lender.

Frequently asked questions

• What is FATCA, and how does it affect my financing choices abroad?

  The Foreign Account Tax Compliance Act requires all foreign banks to report non-US financial assets of US citizens to the Department of Treasury. An unfortunate result of FATCA is that some foreign banks are wary of dealing with US citizens in any capacity — though it mainly affects people interested in opening a bank account (which you’ll likely need to take out a local loan).

• Can I get a foreign online loan as a US citizen?

  Depending on where you live, you might be able to qualify for an online loan in a foreign country. However, as a foreigner, you’re more likely to fall victim to scams. Unless you’re intimately familiar with the country’s regulations involving loans, it might be best to stay away.

• Does my credit score matter when applying for a foreign loan?

  In most cases, no. Your US credit score or report has no bearing on your ability to secure credit in a foreign country. Which means that, for good or for bad, you’re typically starting with a borrowing blank slate in your new country.

  Each country regulates its own ideas of what constitutes good credit — if they keep track of “credit histories” at all. For instance, countries with developing or cash economies generally don’t have a system in place to keep track of a person’s credit. As another example, the UK takes into account how often you vote when determining your credit.

  If you hold an account at an international bank that also has a presence in the US, a bank or lender might request looking at that account for an idea of how you manage your finances. But even how closely they look varies by country.

  To build credit in another country, look into cards offered by local banks. Just be sure to read the fine print before signing any contracts.

Anna Serio

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Anna Serio is a staff writer untangling everything you need to know about personal loans, including student, car and business loans. She spent five years living in Beirut, where she was a news editor for The Daily Star and hung out with a lot of cats. She loves to eat, travel and save money.