Parent PLUS loans
- The Federal Direct Parent PLUS Loan Program provides loans for parents of dependent students attending post-secondary schools.
- A Free Application for Federal Student Aid (FAFSA) must be completed in order to determine eligibility for Federal Direct Loans before a Parent PLUS Loan will be processed.
- The Direct Parent PLUS Loan is an education loan, with an interest rate of 6.31% for the 2016-17 academic year, that allows a parent to fund up to the entire cost of their student's education minus financial aid already awarded. This loan also has an origination fee (4.276% for the 2016-17 academic year) which is deducted from the loan before it is distributed.
- Eligibility is based on credit worthiness of the parent. Parents and/or step parents of dependent undergraduate students are eligible to borrow under the Federal Parent PLUS program.
How to apply for a Parent PLUS Loan
1. Apply online
Beginning with the 2016-17 academic year, parents who wish to borrow a Parent PLUS Loan must apply at www.studentloans.gov. A Federal Student Aid (FSA) User ID and password are required. Choose the "Apply for a PLUS Loan" option.
2. Specify the loan period
You will need to indicate a loan period. For fall, put September to December. For the entire academic year, put September to May. Half will disburse in fall and the other half in spring.
3. Who will receive excess funds?
During the application process you will be asked who should receive any excess funds, the parent or the student. PLUS Loan funds will be disbursed electronically and applied directly to the student's university bill.
4. Do you wish to defer repayment of this loan?
You will be asked to indicate whether you wish to defer repayment until the student is out of school six months. Interest will continue to accrue.
5. How much to borrow
Borrowing the maximum amount available can often result in the student receiving a rather large refund after paying their university charges. For assistance with determining a precise amount to borrow, use our "2016-17 Calculating how much you need to borrow for college" handout. The maximum that can be borrowed is indicated on the student's award as "Your Other Loan Eligibility".
6. Complete a Master Promissory Note
If you do not already have a Direct Parent PLUS Loan Master Promissory Note (Direct PLUS MPN) on file, one must be completed. On the www.studentloans.gov website, choose the option for "Sign a Master Promissory Note".
To be eligible, a parent must:
- be a biological or adoptive parent, or a step-parent whose information was required on the FAFSA
- be a U.S. citizen or eligible non-citizen, and provide a valid Social Security Number
- be creditworthy
The student must:
- be dependent for purposes of financial aid
- be enrolled at least half-time
- Parents who believe that they would be denied the Federal Direct Parent PLUS Loan due to adverse credit may complete the 2016-17 Parent PLUS Credit Check Request Form authorizing a credit check to be completed to determine eligibility.
- If the result of the credit check is a denial, the student will be notified of additional Federal Direct Unsubsidized Loan eligibility.
- If the credit is approved, the Financial Aid Office will notify the parent of the approval and the additional requirements should they choose to complete the Federal Direct Parent PLUS Loan process.
In-school deferment of Parent PLUS loans
- Parents who borrow a Parent PLUS Loan on their student's behalf may defer the payment of the loan. Parent PLUS Loans do not go into repayment until the loan is fully disbursed (usually a loan is fully disbursed around the first day of the spring semester if the loan is for the academic year). When applying for the Parent PLUS loan online at www.studentloans.gov, the parent is given the option to defer repayment of the PLUS loan until the student is out of school six months. If the parent did not choose the deferment option when they initially applied, the parent can complete the required In-School Deferment Request Form, (available from their loan servicer) and mail it to the Department of Education at the address on the form. Interest will continue to accrue while the loan is in deferment.
- The In-School Deferment Request Form will require verification of the student's enrollment. To print out an enrollment certificate to send in with the Request Form, the student should go to their WINGS Student Center. Under Enrollment Resources, the student should choose Enrollment Verification, then choose Enrollment Certificate. This Enrollment Certificate should be sent in with the Request Form to satisfy the requirement for Section 4. (You will not need to submit the Request Form to an Authorized Official to complete Section 4 because the Enrollment Certificate satisfies the requirement).