Parent PLUS Loans
Parents of dependent students can borrow from the Ford Federal Direct Parent PLUS Loan program. The terms and conditions applicable to parent PLUS Loans are:
- a requirement that the parent applicant not have an adverse credit history
- a fixed interest rate of 7% for Direct PLUS Loans
- a 4.276% origination fee from the total amount of the loan
How do parents of undergraduate dependent students apply for a Direct Parent PLUS Loan?
When completing the steps for the PLUS Loan Parents must log into the website with their FSA ID and information, not the student's. Any refund that is generated from the Parent PLUS loan will go to the Parents address listed unless the Parent indicates the refund be sent to the student during the application process.
Students are required to complete a Free Application for Federal Student Aid (FAFSA) in order for our school to process a Parent PLUS Loan. Students are encouraged to receive the maximum amount of federal student loans that they are eligible for.
What are the eligibility requirements for PLUS Loans?
PLUS applicants must meet the general eligibility requirements for federal student aid. If a parent is borrowing on behalf of a dependent undergraduate student, the student must also meet these general eligibility requirements. For example, the PLUS applicant and the student must:
- be a United States citizen or eligible noncitizen
- not be in default on a federal student loan
- not owe a refund on a federal education grant
Are there any other requirements?
A PLUS Loan applicant should not have an adverse credit history. (A credit check will be conducted.) If a PLUS Loan applicant does have an adverse credit history, he or she might still be able to receive a loan by documenting existing extenuating circumstances or by obtaining an endorser who does not have an adverse credit history. An endorser is someone who agrees to repay the loan if the borrower fails to do so.
Do we need to find a lender in order to get a Direct Parent PLUS loan?
No. The U.S. Department of Education is the lender. Your school assists in administering the Direct Loan Program by:
- distributing the loan application
- processing the loan
- disbursing the loan funds.
How much can a parent borrow?
The maximum PLUS Loan amount that a parent can borrow is the student’s cost of attendance, which is determined by the school, minus any other financial aid the student receives.
Who receives the loan money--the parent or the student?
- The school will first apply the PLUS Loan funds to the student’s school account to pay for tuition, fees, room and board and other school charges.
- If any loan funds remain, they will be sent to the parent borrower, in the form of a check, to the permanent address listed on the master promissory note.
- Any remaining loan funds must be used for the student’s education expenses.
Can a borrower cancel a PLUS Loan?
Yes. A borrower can cancel a PLUS Loan the same way that a borrower would cancel a Perkins or Ford Direct Loan, by contacting the Student Financial Assistance Office.
Other than interest, are there any fees or charges to get a PLUS Loan?
Yes. There is an origination fee of 4.276%.
Is there a grace period?
Interest on a Parent PLUS loan begins to accumulate on the date of the first loan disbursement. The first payment is due 60 days after the loan is fully disbursed or it can be defered until six months after the dependent student is not enrolled at least half-time. Interest will accrue during the deferment period. The parent borrower will be sent quarterly interest statements and will have the option of paying the interest as it accrued during the deferment period. If the parent does not pay the interest as it accrues, the unpaid accrued interest will be capitalized (added to the principal balance) at the end of the deferment period. To obtain a deferment, parent borrowers can complete the PLUS Loan Deferment Form along with obtaining a Certification of Enrollment from the Registrar's office and sending the documents to their loan servicer.
How much will the monthly payments be?
The following chart provides federal loan repayment estimates based on the interest rates for the 2017-2018 year. You may also visit StudentLoans.gov to use a customized Repayment Estimator.