Prospective Traditional Undergraduates

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Federal PLUS Loans

Parent Loans for Undergraduate Students (PLUS) are loans made to credit-worthy natural or adoptive parents of eligible dependent undergraduate students who are enrolled at least half time (6 credit-hours or more per quarter.) The borrower must be a U.S. citizen, national, or permanent resident. Although you must file a FAFSA to be considered, PLUS loans are not based on need.

Eligibility is determined by the lender after performing a credit check on the borrower. If a parent is denied a PLUS Loan because of adverse credit, an endorser addendum is automatically mailed. The parent may appeal the denial, reapply with an endorser or the student may request an additional unsubsidized Federal Stafford Loan.

The PLUS had typically had a variable rate of the 91-day T-Bill plus 3.10%, recalculated every July 1st, with a 9% cap. However, for loans taken out during the 2008-2009 school year, the PLUS rate is fixed at 8.5%. A 3% origination fee will be taken out of each loan before the funds are disbursed to the school.

Borrowers typically begin repaying principle and interest within 60 days of disbursement over a 10-year repayment period. However, many lenders allow forbearance of payments until the student graduates (upon request.) Information regarding disbursement and repayment will be mailed to the address the parent provides on the Master Promissory Note (MPN.)

Parents may to borrow up to the total budgeted cost of attendance less all other financial aid. All funds are divided evenly across anticipated terms of enrollment, unless the parent indicates which quarters he or she would like the loan applied.

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