The Parent Loan for Undergraduate Students or PLUS Loan is for parents of dependent undergraduate students and graduate or professional school students. PLUS Loans are affordable and have low interest rates. These loans are insured by the federal government. Schools that participate in the William D. Ford Federal Direct Loan (Direct Loan) Program offer PLUS Loans.
The maximum amount borrowed cannot exceed the total cost of attendance minus financial aid received. For example, if the cost of attendance is $6,000 and a student gets $4,000 in financial aid, they can borrow up to $2,000. The cost of attendance includes tuition and fees, room and board, books and supplies, transportation, and miscellaneous educational expenses. The school determines and certifies the amount.
Your Direct PLUS Loan enters repayment once your loan is fully disbursed (paid out).
However, if you are a graduate or professional student, your loan will be placed into deferment while you are enrolled at least half-time and for six months after you are no longer enrolled at least half-time.
If you are a parent borrower, contact your loan servicer to request deferment:
Interest still accumulates during deferment. You can pay off the interest during deferment. Your loan servicer will notify you when your first payment is due.
PLUS Loans can be cancelled or forgiven. Before your money is disbursed, you can cancel part or all of your loan by notifying your college. After the loan is disbursed, you can cancel part or all of the loan within a specific time frame. Your promissory note and information from your school will explain the procedures and time frames for canceling your loan. You can also qualify for forgiveness of some or all of the loan if you meet certain conditions.
Parent borrowers cannot transfer a Direct PLUS Loan to the child. The parent is responsible for repaying the loan.
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