Federal Direct Parent PLUS Loan
Parents of dependent students, as defined by the federal government, are eligible to apply for the Parent PLUS Loan to assist their student's educational needs. This loan program allows parents to borrow the difference between the cost of education and the financial assistance the student is scheduled to receive. Students must complete the appropriate year FAFSA. Eligibility for this loan will be based on a credit check performed by the Department of Education upon submission of the Parent PLUS Loan application. Additional information on Federal Direct PLUS Loans can be found at the U.S. Department of Education website.
Credit Check Requirement
To meet the federally defined credit worthiness requirements, an applicant cannot be 90 days or more delinquent on the repayment of any debt, the subject of a default determination, bankruptcy discharge, foreclosure, repossession, tax lien, wage garnishment or write off of a Title IV debt during the last five years.
If the parent receives a denied credit decision on their PLUS Loan application, there are a few of options. Parents can add a credit-worthy endorser, appeal the credit decision, or request the Additional Unsubsidized Direct Loan for the student. For more details on options and steps, please see this link.
Annual Loan Amount
When completing the loan application, the parent will have the option to either:
- "specify a loan amount" OR
- "borrow the maximum Direct PLUS Loan amount for which I am eligible, as determined by the school"
If the parent selects to borrow the maximum, please be advised the Office of Financial Aid will process the loan for to meet the total cost of attendance, this amount can be above and beyond the charges directly owed to the school, based on the student’s eligibility. If an adjustment to the amount is needed for any reason, the parent borrower may contact the Office of Financial Aid to request a change to the amount.
Federal Direct Parent PLUS Loan Interest Rate
The 2022-23 interest rate for Federal Direct Parent PLUS Loans disbursed between July 1, 2022, and June 30, 2023, is 7.54 percent fixed.
Interest begins to accrue after the first disbursement of the loan and payment of principal and interest begins 60 days after the final disbursement. Parents can apply for an in-school deferment for as long as their student is enrolled at least half-time. If you wish to defer loan payments, you MUST answer this question accordingly.
All Direct Plus Loans are subject federal origination fee which is subtracted from the loan at the time of disbursement. The origination fee for Federal Plus Loans from July 1, 2021, till June 30, 2022, is: 4.228%.
Parent Plus Application Process
- Visit https://studentaid.gov/plus-app/.The application opens on/after April 1st for each upcoming academic year. Parents must use their own FSA ID to log in to the loan application.
- Complete a required PLUS Loan Master Promissory Note (MPN). Complete this step online at https://studentaid.gov/mpn/. All loans must be processed and disbursed prior to the end of each academic semester.
Once the Financial Aid Office receives the application from the Department of Education, we will update the financial aid award to reflect the approved Parent PLUS Loan amount.
Parent PLUS Loan Denials
In the event that a Parent PLUS Loan is denied, the student is eligible for increased Unsubsidized Loan. Parents can also seek the following options after a PLUS Loan denial:
- To add an endorser, follow these steps:
- Find a credit worthy endorser and supply them with the loan reference number
- The endorser must request an FSA ID with the Department of Education. They will then use that FSA ID to sign into www.studentaid.gov.
- Have the endorser complete an endorser addendum
- Complete a new Master Promissory Note (MPN) including your endorser
- To appeal your credit decision you must:
- Document to the satisfaction of the U.S. Department of Education that the information causing the adverse credit decision is incorrect or has been corrected OR there are extenuating circumstances relating to the adverse credit history.
- After you submit your request to document extenuating circumstances, Applicant Services will contact you. Once all documentation has been received, a determination will be made and provided to you within 7-10 bsiness days.
- Applicants who have adverse credit decisions and are subsequently approved through the process of appeals or receive approved endorsed Plus Loans decisions are now required to complete Plus Counseling which will need to be completed prior to loan origination and disbursement. To complete Plus Counseling please log into www.studentloans.gov and select the ‘Complete Plus Counseling’ option on the left hand side of the screen. Please note this counseling must be completed in one sitting as there is no ‘save progress’ function. For questions about whether you need to complete this counseling or not please contact the Student Loan Support Center at 800-557-7394.
In the event that the PLUS loan was originally denied and subsequently approved with an endorser or approved on an appeal, the parent will be required to complete mandatory PLUS Loan Credit Counseling found here and a new Master Promissory Note for the endorsed PLUS Loan.
Timeline (PLUS Loan)
All application steps must be completed at least 30 business days prior to the start of a term which the student wishes to receive aid for. This includes:
- Filing a FAFSA
- Submitting any Missing Information requests
- Completing Verification (if applicable)
- Accepting the loan(s) in Financial Aid Self-Service
- Completing PLUS application and authorizing a PLUS Loan credit check with the Department of Education
- Completing a PLUS Loan Master Promissory Note
All loans require processing time before the funds will be ready to disburse. Students may receive loan funds for a term only if they are currently enrolled in that term at least half time and loan funds disburse prior to end of that term. If completion of required steps occurs after the 10 business days prior to the end of the term, the Office of Financial Aid cannot guarantee that loan(s) will be processed before the end of the eligible timeframe.
Please note that the borrower has the right to cancel a portion of or the entirety of their loan within 30 days of the disbursement of the funds to the student’s account. After which time it is the borrower’s responsibility to return any unwanted funds to the lender or federal loan servicer. To request a cancellation, please contact the Office of Financial Aid at firstname.lastname@example.org and state what loan and amount you would like canceled or reduced.