Federal Direct PLUS Loan
Eligibility (Eligibility Chart)
In addition to the Federal Direct Subsidized and Unsubsidized Stafford Loans available to student borrowers, parents of dependent students may borrow additional funds through the William D. Ford Federal Direct PLUS Loan program. The borrower must be a natural parent, adoptive parent, or stepparent (if his/her income and assets are considered in the Expected Family Contribution) of the dependent student. The lender is the U.S. Department of Education rather than a bank or credit union. Parents may borrow any amount up to the cost of education minus any other financial aid their son or daughter may receive. Eligibility will be based upon a satisfactory credit check.
To apply, submit the application online (see guidelines and tips below; FSA ID and minimum browser support required). The Free Application for Federal Student Aid (FAFSA) must also be submitted before a Federal Direct PLUS Loan Application can be processed. By completing a Federal Direct Plus Loan application, a parent borrower authorizes the Department of Education to review the borrower's credit record for each loan received.
If a parent has adverse credit history, they may still receive a Direct PLUS Loan through one of these two options:
- Obtaining an endorser who does not have an adverse credit history.
- Documenting to the U.S. Department of Education’s satisfaction extenuating circumstances relating to the adverse credit history.
Once one of the options above has been completed, counseling for PLUS Loan borrowers must also be completed at StudentLoans.gov. Failure to complete this requirement will prevent the disbursement of the PLUS Loan funds.
If a parent is unable to secure a PLUS Loan, the student may be eligible for additional unsubsidized loans.
The Master PLUS Promissory Note (MPN) will simplify the processing of your loan(s). The Federal Direct PLUS MPN is a promissory note that can be used to make one or more Federal Direct PLUS Loans to a parent borrower to help pay for the educational costs of one dependent student for one or more academic years. In most cases, the parent may receive additional Federal Direct PLUS Loans for that student up to 10 years without completing a new Federal Direct PLUS MPN.
A parent who wants to borrow Federal Direct PLUS Loans for more than one dependent student must complete a separate Federal Direct PLUS MPN for each student. In addition, if each parent wants to borrow Federal Direct PLUS Loans for the same student, they must individually complete a separate Federal Direct PLUS MPN.
If it is determined that the parent has an adverse credit history and has obtained an endorser for a Federal Direct PLUS Loan, the Federal Direct PLUS MPN that the parent completes becomes a "single-loan" promissory note. No further Federal Direct PLUS Loans may be made under that Federal Direct PLUS MPN. The endorser is liable only for the specific loan that he or she has agreed to endorse.
The interest rate is fixed and is adjusted each year on July 1. There is a loan fee deducted from each disbursement of the PLUS loan. (See information about interest rates and fees.)
The loan will be applied to the student’s account. The loan must be disbursed in two equal amounts at the beginning of each term. The loan disbursement check is made payable to the student and mailed to the home of the parent borrower if the disbursement is in excess of the amount owed to the University (unless the parent requests on the initial Federal PLUS Loan application that the refund be issued to the student).
Changing your loan amounts
You may cancel all or portions of your loan(s) after the funds have been credited to your student's account by notifying us in writing within 30 days after the date of the disbursement notice. Contact the One Stop to determine if eligibility for increased funding is available. Please note that you may borrow any amount up to your student's cost of attendance minus any other financial aid your student may receive for the academic year.
The parent is responsible for repayment of this loan. Effective July 1, 2008, parents have the option of beginning repayment either 60 days after the loan is fully disbursed, or defer until six months after the dependent student on whose behalf the loan was obtained ceases to be enrolled on at least a half-time basis. Interest accrues as soon as the first disbursement is made, including periods of loan deferment.
The Federal Direct Loan Program offers loan repayment plans designed to meet the needs of almost every borrower. Federal Direct loan borrowers may choose between the standard, extended, or graduated repayment plans. Approximately 7 -10 business days after the first disbursement of your loan, your loan is assigned to a loan servicer who will then send you information regarding your loan. Repayment of PLUS loans is managed by the loan servicer. Parent borrowers with Direct PLUS Loans should contact their loan servicer if they wish to delay repayment on their Direct PLUS Loans until six months after the student has ceased at least half-time enrollment. To review your loans and to obtain your loan servicer contact information, you may access www.nslds.ed.gov. You will need to login using your FSA ID.
You will have from 10 to 25 years to repay depending upon the repayment plan chosen by the parent. To estimate an amount of repayment based on the standard, extended, or graduated repayment plans, you can use the Direct Loan's interactive repayment calculator. Calculations are estimates and the values may not reflect the actual amount computed by the Direct Loan Servicing Center.
Parents who are experiencing difficulty making their loan payments, may be able to postpone payments through a deferment or forbearance request.