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Direct Parent PLUS Loan

Parents of dependent students may apply for loans from a non-need-based program called the Federal Direct Parent PLUS Loan Program. The parent may borrow an amount up to the cost of attendance minus other financial aid. At disbursement, the funds will first be transferred into the student's University account to pay for school charges. If any money remains, the parent of the student will receive the balance unless the parent designates that the student should be the recipient.

Details

  • Parent must apply for the Parent PLUS each time they borrow through the PLUS program. The application can be completed at StudentLoans.gov
  • You may not borrow more than your cost of attendance less other aid received.
  • For current interest rates please visit studentaid.gov
  • To complete MPN: Log in to www.studentloans.gov; Click Complete Master Promissory Note and then select Parent PLUS.

Eligibility

Parent PLUS Loans

  • You need to be the natural or adoptive parent of the student for whom the Federal PLUS Loan is being borrowed. A step-parent is also eligible to borrow.
  • You need to be a U.S. citizen, U.S. national, or permanent resident of the United States.
  • Your child needs to be an eligible dependent undergraduate student who is enrolled at least half time in a program leading to a degree or certificate.
  • Student needs to have a current FAFSA on file.
  • You and the student must not be in default on a federal student loan and must not owe a refund on a federal education grant.
  • You need to meet specified credit requirements.
    • If parents are denied a PLUS loan due to adverse credit, the student will become eligible for additional unsubsidized Direct (Stafford) loans. Amounts vary depending on the student's academic level. Contact the financial aid office if you have been denied a PLUS loan.
    • Parents can also request a co-signer/endorser if denied the loan.  If a co-signer/endorser is requested, the student would lose eligibility for additional unsubsidized loans in their own name.

Borrowing Limits for PLUS Loans

  • You may not borrow more than your cost of attendance less other aid received.

Interest Rates

  • Fixed interest rate
  • Interest begins to accumulate on the date of the first loan disbursement.
  • An origination fee is deducted before disbursement for loans
  • For current rates please visit www.studentloans.gov

Repayment

After you receive the full disbursement of the Federal PLUS Loan for the school year, the repayment period begins. You will make your first payment within 60 days after the entire PLUS Loan is disbursed for a school year. Keep in mind, this usually means that repayment begins while your child is still in school. You make monthly payments directly to the lender.

Payment Deferment Options for Parent Direct PLUS Loan Borrowers

For Direct PLUS Loans that are first disbursed on or after July 1, 2008, parent Direct PLUS Loan borrowers may defer repayment

  • While the dependent student on whose behalf the loan was obtained is enrolled on at least a half-time basis, and
  • During the 6-month period after the dependent student on whose behalf the loan was obtained ceases to be enrolled on at least a half-time basis.
  • Parent borrowers must contact the Direct Loan Servicing Center at (800) 848-0979 to request a deferment based on the dependent student's enrollment status
    • Deferment must be requested for each Parent PLUS Loan borrowed.

Remember

  • Interest will still accrue during the deferment period
  • The parent borrower will be sent interest statements and will have the option of paying the interest during the deferment period
  • The unpaid accrued interest will be capitalized (will be added to the principal balance) at the end of the deferment period
  • Direct PLUS loans with an early disbursement date prior to July 1, 2008 are not eligible for this deferment

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