Federal Direct Parent PLUS Loan: What is it?
A credit-based loan with a fixed interest rate of 7.08%, with up front origination fees of 4.236% for loans first disbursed before October 1, 2020. After October 1, 2020 the up front origination fee will be reassessed and could change. Repayment begins 60 days after the second disbursement, although most lenders offer an annual forbearance option.
Who can apply?
Parents of dependent undergraduate students approved for credit purposes. A parent borrower is defined as a natural or adoptive parent, legal guardian or step-parent. Parent borrowers and their student must also be U.S. citizens or eligible noncitizen and not currently in default on Federal aid.
The student must be enrolled at least half-time in a degree seeking program, meet the Federal Academic Progress Standards (SAP), and have a completed FAFSA on file.
How much can you borrow?
The annual limit is the undergraduate cost of attendance minus all other financial aid, including loans. Although Direct PLUS Loans are not need-based, families must complete the Free Application for Federal Student Aid (FAFSA) before a PLUS loan application will be processed by the Financial Aid Office to insure that other federal eligibility requirements, including citizenship and absence of other student loan defaults, are met. For additional information about the Federal Direct PLUS Loan, please visit www.studentaid.gov.
What if My Credit is Denied?
If the borrower's credit is denied, two alternate options exist:
- The borrower may seek a credit-worthy endorser - a co-signer for the loan. The endorser must complete the endorser addendum at www.studentaid.gov after school certification occurs.
- The student may request additional unsubsidized Direct Stafford Loan funds - up to $4,000 for students who have completed 53 or fewer credits and up to $5,000 for students who have completed 53.5 or more credits.
Loan Repayment Calculator
The loan repayment calculator generates the monthly amount you would face based on the loans you assume. If you borrowed a total of $40,000 through PLUS loans, for instance, the monthly payment would be $495.
Parent Debt Calculator
The parent debt calculator can help you determine how much college debt you can reasonably assume after considering your other monthly bills.
How do I apply?
- Click the "Sign In" button located near the top of the page.
- You will need your federal FSA ID. An FSA ID can be requested at studentaid.gov. Do not use the student's FSA ID or SSN.
- Choose "Apply for Aid" and select "Apple for a Parent PLUS Loan" and "Start" your application.
We suggest borrowing only what you need, so if you know the exact amount due or have an estimate of what you will owe, input an amount in the "Loan Request Amount" box. To prevent a balance, you are encouraged to include in the amount borrowed enough to cover the origination fees that will be deducted from the loan prior to disbursement.
Choosing the correct loan term dates is essential for loan processing and payment:
- Academic Year: August - April. Loan disburses in two equal installments, one applies to the fall term bill, the other applies to the spring term bill. (Highly recommended if you are attending the entire academic year.)
- Fall only: August - December. Loan disburses in one installment and is applied to the fall term bill.
- Spring only: January - April. Loan disburses in one installment and is applied to the spring term bill.
- Summer only: May - August. Loan disburses in one installment and is applied to the summer bill.
Parent borrowers will receive a credit decision almost immediately after completing the PLUS Request.
- If credit is approved, the Department of Education will request certification from the Financial Aid Office. Depending upon the time of the year, certification may take up to three weeks.
- If credit is denied, please review the options in the "What If My Credit is Denied" section.
First time borrowers whose credit is approved or those choosing to use an endorser must complete a Master Promissory Note (MPN). Borrowers complete the PLUS MPN online at studentaid.gov. A separate MPN is required for each child for whom you wish to borrow.