PLUS Loans

The Parent Loan for Undergraduate Students or PLUS Loan may be taken out by parents of dependent undergraduate students and by graduate or professional school students. It is an affordable, low-interest loan designed to help students and parents pay for a college education. This is a government loan meaning that it is guaranteed (or insured) by the federal government. Schools that participate in the William D. Ford Federal Direct Loan (Direct Loan) Program offer PLUS Loans.

Borrowing Limits

The maximum amount borrowed may not exceed the total cost of attendance minus any other financial aid received. If the cost of attendance is $6,000, for example, and a student receives $4,000 in aid, only $2,000 may be borrowed. The cost of attendance may include tuition and fees, room and board, books and supplies, transportation, and miscellaneous educational expenses. The student's school will determine and certify this amount.

Interest Rates and Fees

• Interest rates on PLUS Loans disbursed on or after July 1, 2012, are fixed at 7.9%.
• Interest is charged on a PLUS Loan from the date of the first disbursement until the loan is paid in full.
• In addition to the interest rate, a loan fee of up to 4% will be charged. It will be deducted proportionately from each loan disbursement.

Loan Repayment

• Interest rates on PLUS Loans disbursed on or after July 1, 2012, are fixed at 7.9% for Direct PLUS Loans and at 8.5% for FFEL PLUS Loans.
• Interest is charged on a PLUS Loan from the date of the first disbursement until the loan is paid in full.
• In addition to the interest rate, a loan fee of up to 4% will be charged. It will be deducted proportionately from each loan disbursement.

Loan Repayment

• For parent borrowers, the first payment for PLUS Loans disbursed before July 1, 2012, is due within 60 days after the loan is fully disbursed.
• For parent borrowers, the first payment for PLUS Loans disbursed on or after July 1, 2012, may be made either 60 days after the full disbursement or six months after the student ceases to be enrolled on at least a half-time basis.
• Graduate and professional school students may request to have their loan payments deferred until graduation as long as they are attending school on at least a half-time basis. Some may also be eligible for a three-year deferment if they are seeking but unable to find full-time employment.
• For both parents and students, interest begins to accumulate after the first disbursement is made.