Unlike the federal Direct Subsidized and Unsubsidized loans borrowed by students, the Parent PLUS loan requires a credit check that is valid for 180 days. The parent is notified immediately after applying whether they are approved or denied. If the credit check leads to a denial, parents have 3 options:
- Obtain an endorser who does not have an adverse credit history. An endorser is someone who agrees to repay the Direct PLUS Loan if you cannot repay it.
- Document to the satisfaction of the U.S. Department of Education that there are extenuating circumstances related to your adverse credit history.
- Have your student apply for additional Direct Unsubsidized Loan funds instead of taking action on the PLUS. If you wish to go this route, please have your student submit to our office the Request for Additional Unsubsidized Loan form found in the Forms tab of our website.
With either option 1 or option 2, you also must complete “PLUS Counseling” for PLUS loan borrowers on the www.StudentLoans.gov website.
Interest Rate and Origination Fee
The interest rate for Federal Direct PLUS Loans depends on when the loan was first disbursed. Visit the Federal Student Aid website for information about current and past rates. Interest rates are determined each spring for new loans being made for the upcoming award year, which runs from July 1 to the following June 30. Each loan has a fixed interest rate for the life of the loan.
The Department of Education charges an "Origination fee" on all Direct PLUS Loans. The loan fee is a percentage of the loan amount and is proportionately deducted from each loan disbursement. See the Federal Student Aid Website for the current loan fee percentages.
How to Apply
To apply for a Federal Direct PLUS Loan, you must:
- Talk with your student about the amount of PLUS loan eligibility shown on their Financial Aid Award Letter, available through your student’s My Aid Status
- Visit www.studentloans.gov and log in with the parent’s FSA ID and password. Please make sure you are not logging in with the student’s FSA ID
- Click “Apply for a PLUS Loan”. You will be asked for the amount you would like to borrow – please refer to the student’s Financial Aid Award Letter as mentioned above
- Complete a Parent PLUS Master Promissory Note on the same website as above
- If your credit was denied and you wish to appeal or endorse:
- Appeal: log into www.studentloans.gov, click “Document Extenuating Circumstances” and follow the instructions.
- Endorse: Have your endorser create an FSA ID, and then log into www.studentloans.gov and click “Endorse a PLUS Loan”
- If the loan was endorsed or you completed a successful credit appeal, complete the PLUS Counseling through www.studentloans.gov
Our office receives daily electronic updates for completed loan applications. Please allow 5-7 business days for our office to process the loan.
While applying for the loan, parents will be given two disbursement options:
- STUDENT: If you indicated on the application that (1) you want the money to go to the “student”, and (2) you authorize the funds to apply towards any educationally-related charges on BARC, then the PLUS funds will credit to the student’s BARC account in 5-7 business days as long as your student is enrolled in more than 6 units. Those funds first pay any university fees and the remaining amount is then "refunded” to the student. The earliest these funds will be released to the student is 7 days before the start of the quarter.
- BORROWER: If you chose the “borrower” method, or chose "student" but did NOT authorize the funds to apply to all charges on the student account, the proceeds of the loan are mailed as a check to the parent’s address during the first week of classes for that particular quarter. These checks are not mailed until after the fees on the student's BARC account are paid or deferred, so the check from the PLUS loan will not be available in time to pay for university fees.
In order to receive your funds in a timely manner, we strongly encourage you to select the “student” disbursement option. If you chose “borrower” but would like to change the disbursement method to “student”, you can complete our Parent PLUS Loan Adjustment Form found on the Forms tab of our website.
Repayment begins 60 days after the final disbursement of the loan. During the application process, a parent can also choose to defer repayment until 6 months after the student graduates or leaves school.
Information about your loan is submitted to the National Student Loan Data System (NSLDS), which is the database where you may view your entire federal loan history. Please visit www.nslds.ed.gov to view your borrowed loan amounts, disbursement dates, and who your federal loan servicer is as well as their contact information. The federal loan servicer is assigned by the Department of Education, and they handle matters related to billing and repayment of your loans. If you have questions about changing your repayment plan, loan consolidation, if you qualify for loans forgiveness, please talk to your servicer.
We suggest you utilize Federal Student Aid’s Repayment Estimator to see approximately how much a month you will owe.