Federal Direct PLUS Loans

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Loan Summary  |  Interest Rates & Origination Fees  |  Capitalizing Interest  |  How To Apply Getting Your Funds  |  Paying Back Your Loan  |  Deferment  |  Federal Updates  |  Getting Help

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Federal Direct PLUS Loans (includes Graduate PLUS)

The Federal Direct PLUS Loan is a credit-based supplemental loan that helps the parents of dependent students meet the cost of their child’s education expenses for the academic year. Under the PLUS loan program, parents and/or graduate and professional students may borrow up to the full cost of education minus other financial aid received.  Interest is charged during all periods and credit checks are required.

Unlike the education loans borrowed from private lenders, Federal Direct PLUS Loans are borrowed from the U.S. Department of Education.

 

LOAN Summary:

2016-2017 Academic Year

 

 DIRECT PLUS LOAN

ELIGIBILITY

Credit-worthy parents of dependent students, or graduate students.

In order to be eligible, the parent borrower must be the student’s biological or adoptive parent and the student must also be enrolled at least half-time.

In addition, both the parent borrower and the student must be U.S. citizens or eligible non-citizens with a valid Social Security number, must not be in default or owe a repayment to any student financial aid program and must meet other general federal aid eligibility requirements.

CREDIT CRITERIA

The borrower must pass a credit review to receive the Federal Direct PLUS Loan. Federal standards of creditworthiness are substantially more flexible than those required under private loan programs. You must pass a credit review and you must not have adverse credit history, defined as:

  • A current 90-day delinquency
  • Debt discharged in bankruptcy during the past five years
  • Evidence of a default, foreclosure, tax lien, repossession, wage garnishment, or write-off of a Title IV debt during the past five years

If you do not meet the credit criteria, you can apply with an Endorser, who must meet the credit criteria. The Endorser promises to repay the loan if the borrower fails to do so as agreed. PLUS Loan credit decisions are good for 180 days.

INTEREST

For loans first disbursed after July 1, 2016, the interest rate is fixed at 6.31%.

 

Interest Rate Cap for Military Members:

 

If a parent borrower qualifies under the Service Members Civil Relief Act, the interest rate on loans obtained before entering military service may be capped at 6% during their time of military service.  You must contact the loan servicer if you believe that you may qualify and request this benefit.

LOAN FEES

Loans first disbursed on or after October 1, 2015 and before October 1, 2016 have the origination fee of 4.272%.
 
Loans first disbursed on or after October 1, 2016 and before October 1, 2017 have the origination fee of 4.276%.

REPAYMENT

Begins at the time the PLUS loan is fully disbursed and the first payment is due within 60 days after the final disbursement.

Borrowers are given a 6-month post enrollment period to align the repayment with the direct subsidized/unsubsidized loans.

LIMITS PER ACADEMIC YEAR

The maximum annual amount that may be borrowed is the student’s cost of attendance minus any other financial aid that the student receives.

 

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2015-2016 Academic Year

 

 DIRECT PLUS LOAN

ELIGIBILITY

Credit-worthy parents of dependent students, or graduate students.

In order to be eligible, the parent borrower must be the student’s biological or adoptive parent and the student must also be enrolled at least half-time.

In addition, both the parent borrower and the student must be U.S. citizens or eligible non-citizens with a valid Social Security number, must not be in default or owe a repayment to any student financial aid program and must meet other general federal aid eligibility requirements.

CREDIT CRITERIA

The borrower must pass a credit review to receive the Federal Direct PLUS Loan. Federal standards of creditworthiness are substantially more flexible than those required under private loan programs. You must pass a credit review and you must not have adverse credit history, defined as:

  • A current 90-day delinquency
  • Debt discharged in bankruptcy during the past five years
  • Evidence of a default, foreclosure, tax lien, repossession, wage garnishment, or write-off of a Title IV debt during the past five years

If you do not meet the credit criteria, you can apply with an Endorser, who must meet the credit criteria. The Endorser promises to repay the loan if the borrower fails to do so as agreed. PLUS Loan credit decisions are good for 180 days.

INTEREST

For loans first disbursed after July 1, 2015, the interest rate is fixed at 6.84%.

 

Interest Rate Cap for Military Members:

 

If a parent borrower qualifies under the Service Members Civil Relief Act, the interest rate on loans obtained before entering military service may be capped at 6% during their time of military service.  You must contact the loan servicer if you believe that you may qualify and request this benefit.

LOAN FEES

Loans first disbursed on or after October 1, 2014 and before October 1, 2015 have the origination fee of 4.292%.

Loans first disbursed on or after October 1, 2015 and before October 1, 2016 have the origination fee of 4.272%.

REPAYMENT

Begins at the time the PLUS loan is fully disbursed and the first payment is due within 60 days after the final disbursement.

Borrowers are given a 6-month post enrollment period to align the repayment with the direct subsidized/unsubsidized loans.

LIMITS PER ACADEMIC YEAR

The maximum annual amount that may be borrowed is the student’s cost of attendance minus any other financial aid that the student receives.

 

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Interest Rates and Origination Fees

Interest rates are subject to change each year, however, federal loans since 2006 have remained fixed rate loan products. You can view current Direct Loan interest rates on the U.S. Department of Education website.

 

2016-2017 ACADEMIC YEAR

This chart provides the interest rates and fees associated with Direct Loans disbursed from July 1, 2016 - June 30, 2017.

 

 

 

ORIGINATION FEE

UPFRONT REBATE

INTEREST RATE

PLUS - Parent & Graduate

4.276%

0%

6.31%

 

 

2015-2016 ACADEMIC YEAR

 

 

ORIGINATION FEE

UPFRONT REBATE

INTEREST RATE

PLUS - Parent & Graduate

4.272%

0%

6.84%

 

You can view Direct Loan interest rates from previous years on the Federal Student Aid website.

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Capitalizing Interest

Direct Loan Servicing capitalizes all unpaid interest:

  • when repayment begins
  • when a period of deferment ends 
  • when a period of forbearance ends
  • annually, under the Income Contingent Repayment (ICR) plan, for borrowers whose payments do not cover their monthly interest accrual.

 

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Application Process

PLUS Loan Authorization Form

A Plus Loan Authorization form must be submitted by the parent borrower or student borrower in order to process an initial credit check. Each Financial Aid Office has a designated authorization form.  An authorization form must be completed each time a new plus loan is borrowed. Use the links below to access the form for your school. If your school is not listed, contact your School Financial Aid Office.

Please contact your School Financial Aid Office for additional information or for assistance initiating a credit check authorization on your Federal Direct Parent PLUS Loan.

 

Master Promissory Note

A Federal Direct Plus Master Promissory Note must also be submitted. This document can be completed by logging into StudentLoans.gov and selecting the option, "Complete Direct Subsidized/Unsubsidized Loan Master Promissory Note (MPN)."

Graduate or professional students will also be required to complete entrance counseling before receiving a PLUS loan.

If you have an adverse credit history, you must complete credit counseling for PLUS loan borrowers on the StudentLoans.gov website.

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Disbursement

Loan funds are disbursed to the student's tuition account.

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Repayment Options

Learn more about repayment options for Direct Federal Loans here.

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Deferment

The maximum period for which a borrower may receive a deferment is determined in accordance with the Direct Loan Program regulations, and depends on the deferment type.  Information about deferments is available on the Department of Education website. For more information about deferments, click here.

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Federal Updates

There are no federal updates at this time.

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Getting Help

Visit the Department of Education's website for Direct Loans.

If you have questions, you can also contact the Direct Loan Servicing Center directly at 1-800-848-0979 or TDD 1-800-848-0983.

For integrated view of all your Title IV loans and grants, please visit the Department of Education's National Student Loan Data System (NSLDS).

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