The Federal PLUS Loan (also known as the William D. Ford Direct PLUS Loan) may be available to parents of dependent students as part of the student’s financial aid award offer. The lender is the U.S. Department of Education rather than a bank or other financial institution.
- Biological parents are eligible to apply for this loan whether or not their information is provided on the FAFSA.
- A stepparent is eligible to apply for a Federal PLUS loan only if his or her information was provided on the FAFSA.
- Grandparents and other relatives are not eligible for this type of loan.
- This loan requires a credit check for the parent borrowing the loan.
- There is a loan origination fee of 4.272%.
- Repayment begins 60 days after the loan is fully disbursed. Parents can contact the Direct Loan Servicer after the loan has disbursed to request a deferment for up to 6 months after your student leaves school or drops below half-time. Interest will be capitalized at the end of the deferment period.
- Parents may borrow up to the full cost of attendance, less other financial aid received.
- If the parent applicant is not approved for the loan, he or she will have the ability to obtain an endorser or the student can be offered additional Federal Direct Unsubsidized Loan.
- It is possible for a parent to qualify for a PLUS loan with a bad credit score, so long as they don't have an adverse credit history (i.e., no more than 90 days late on any debt and no defaults, bankruptcies or other adverse action on any Title IV debt).
Fixed Interest Rates
|Date of First Disbursement||Interest Rate|
|Before July 1, 2015||7.21%|
|7/1/15 - 6/30/16||6.84%|
More information about Parent PLUS Loans is available from the Department of Education.
Before applying for a Federal PLUS Loan, we recommend you consider these Options for Financing Your Education.
- Complete the FAFSA with your student. The Free Application for Federal Student Aid (FAFSA) has to be done every year.
- Apply for the PLUS Loan. To apply for the loan, the parent borrower will use his/her Federal Student ID (FSA ID) to sign in to studentloans.gov. If you do not have an FSA ID, you will be required to create one. Do not use your student's FSA ID. After the parent signs in, click on "Apply for a PLUS Loan." We highly recommend you calculate how much aid you need to apply for and only borrow what you need.
- Authorize a Credit Check. The parent will be asked to authorize a credit check when applying for the PLUS Loan. The Office of Financial Aid will receive confirmation of the credit decision along with the amount requested. If the credit is approved, our office will accept the loan in the student portal. If the loan request is more than the parent is eligible for, it will be reduced accordingly.
- Receive PLUS Loan Disclosure Statement. The parent will be mailed a disclosure statement from the Federal Direct Loan Servicer which will verify the loan has been approved.
- The parent should also complete the Federal Direct PLUS Loan Master Promissory Note through studentloans.gov.
Use an Endorser
If credit is denied, the parent will have the ability to obtain an endorser by completing the request on studentloans.gov. The endorser will need the PLUS Endorser Code to connect the endorsement to the denied PLUS loan. This can be found in the denial notice email or by logging into studentloans.gov and selecting “Direct PLUS Loan Requests.” We highly recommend using an electronic endorser as it is the fastest way to complete this request. If you choose to complete your request with a paper endorser, you must notify our office when the endorser is approved, or your loan may be delayed.
If the parent does not have an endorser, the student can contact our office to request an additional unsubsidized Federal Direct Loan.
Submit an Appeal
You can appeal to the Department of Education with proof the credit information used was incorrect or has been corrected or extenuating circumstances relating to the credit history.,Sign in to www.studentloans.gov and click ‘Document Extenuating Circumstances’ in the left-hand navigation below ‘PLUS Loan Process’. After you complete your appeal you will be contacted by the Federal Loan Origination Center within three business days to discuss your appeal. If you do not receive a call, you may contact them at 1-800-557-7394.
If you qualify for a Direct PLUS Loan after obtaining an endorser or documenting extenuating circumstances, you will be required to complete loan counseling on studentloans.gov.
- The Federal PLUS Loan proceeds are applied to the student’s university bill three (3) days prior to the beginning of the semester. Any remaining proceeds will be sent to the parent via paper check unless the parent authorizes the funds to be released to the student’s bank account via direct deposit, which is much faster.
- It is generally a good idea for parents who think they might be denied a Federal PLUS Loan or who have other exceptional circumstances preventing them from borrowing a loan to contact our office before applying.
- Borrowing a Federal PLUS Loan will be regarded as parental support on in-state residency petitions.