Repayment and Deferment for Direct PLUS Loans for Parents
The repayment period for a Direct PLUS Loan begins at the time the PLUS Loan is fully disbursed, and the first payment is due within 60 days after the final disbursement. However, for Direct PLUS Loans with a first disbursement date on or after July 1, 2008, the parent may defer repayment:
• while the student on whose behalf the parent borrowed the loan is enrolled on at least a half-time basis, and
• for an additional six months after the student ceases to be enrolled at least half-time.
Parents may request to defer repayment of a PLUS Loan by completing an In-School Deferment Request form although interest will continue to accrue.
Direct PLUS Loan Master Promissory Note and Direct PLUS Loan Request (for Parents)
• The Direct PLUS Loan Request must also be completed online at www.studentloans.gov using the parent borrower’s FAFSA PIN. This online PLUS Request process must be completed each year that a parent borrows a PLUS Loan.
• Previous borrowers of a Direct PLUS Loan (for the same student) only need to complete the Direct PLUS Loan Request at www.studentloans.gov since there is already an MPN on file for that parent.
Your first step is to accept the Parent PLUS Loan on your Financial Aid Award. • The parent must complete a Direct PLUS Loan Master Promissory Note (MPN) online at www.studentloans.gov using the parent borrower’s FAFSA PIN. The MPN is a legal document in which the parent borrower promises to repay the loan and any accrued interest and fees to the U.S. Department of Education. The MPN explains the terms and conditions of the loan and can be used for loans that a parent receives over a period of multiple academic years. using
Parents of dependent students may apply for a Direct PLUS Loan to help pay for their student’s education as long as certain eligibility requirements are met. To be eligible for a Direct PLUS Loan for parents:
• The student for whom the parent is borrowing the PLUS Loan must have filed a FAFSA.
• The parent borrower must be the student’s biological or adoptive parent, or stepparent.
• The student must be a dependent student who is enrolled at least half-time.
• The parent borrower must not have an adverse credit history. If the parent does not pass the credit check, the parent may still be able to borrow the loan if someone agrees to endorse the loan. The endorser promises to repay the loan if the parent borrower fails to do so.
• The student and parent must be U.S. citizens or eligible noncitizens, must not be in default on any federal education loan, or owe an overpayment on a federal education grant, and must meet other general eligibility.
Parents may borrow up to the cost of attendance minus other financial aid received. The interest rate is fixed at 7.9% and interest is charged from the date of the first disbursement until the loan is paid in full. An origination fee of 2.5% is deducted proportionately each time a disbursement is made.