There is no deadline for the Parent PLUS loan (minus that it needs to be applied to prior to the end of the academic year). You can apply for the loan throughout the academic year. I would more check when the bill needs to be satisfied by, aka a plan (loan, payment plan, etc.) in place.
If you're a parent or graduate student seeking a Direct PLUS Loan, one of the requirements to qualify is that you must not have an adverse credit history. If your application is denied because of an adverse credit history, don't give up. You still have options.
PLUS Loan applications must be submitted after the student has already submitted the FAFSA for that year. Then each school has its own process for handling PLUS applications. After July 1 (the beginning of the aid year) they should be open for all schools, but it's possible that your child's school opens them earlier.
Unless you have current collections it's pretty easy to get approved for a parent loan, your credit score is fine. If you're declined you can appeal and prove you've paid off anything.
How to Use the Double Consolidation Loophole: The key to using the double consolidation loophole is to consolidate each of your Parent PLUS Loans twice. In this scenario, a borrower can have as few as two Parent PLUS Loans.
According to the most recently available data from the National Center for Education Statistics (NCES), the average loan amount for Parent PLUS loans in 2019-2020 was $34,630. When adjusting for inflation, that's $37,970 in 2021-2022 constant dollars.
How long does processing take? Due to the value of PLUS applications at peak times (particularly summer and the start of the Fall term), PLUS loans can take 4 weeks for processing and for the loan to be posted on the student's financial aid summary.
You, the parent borrower, are legally responsible for repaying the loan.
Parent PLUS loans can potentially be forgiven after 10 years under specific conditions, such as through the Public Service Loan Forgiveness (PSLF) program after consolidation into a direct consolidation loan. Parent borrowers must enroll in the Income-Contingent Repayment (ICR) plan to qualify for PSLF.
What Are Some Reasons to Avoid PLUS Loans? First, PLUS loans have no automatic grace period. Then there's the fact they aren't eligible for most IDR plans. Then, borrowing too much is easy to do, and finally, they're nearly impossible to get out of, even in bankruptcy.
With Parent PLUS loans, the parent can borrow up to the cost of the child's attendance each year, minus any financial assistance that has been awarded, with no limit on the amount borrowed. This is true regardless of the parent's income.
What happens to my parent's PLUS loan if my parent dies or if I die? Your parent's PLUS loan will be discharged if your parent dies or if you (the student on whose behalf your parent obtained the loan) die.
Why a Parent PLUS Loan Might Be Denied. If your Parent PLUS Loan was rejected, it may be because you don't meet the credit requirements. PLUS borrowers can't have an adverse credit history, such as being at least 90 days overdue in making a debt payment or completing bankruptcy in the last five years.
The interest rate for Parent PLUS Loans first disbursed on or after July 1, 2024, and before July 1, 2025, is currently 9.08%. This rate is fixed for the life of the loan.
Key Takeaways
PLUS loans have the highest rates of any type of federal student loan. Private parent loan interest rates can be fixed or variable and are based on the borrower's creditworthiness. Private loans may offer lower rates than federal PLUS loans for well-qualified applicants.
However, you don't need to meet a minimum credit score to qualify. Instead, the check looks for “adverse credit,” such as bankruptcies, repossessions, wage garnishment, or tax liens in the past five years. But even if you do have adverse credit, you may still be able to get a parent PLUS loan.
Generally, you'll have from 10 to 25 years to repay your loan, depending on the repayment plan that you choose. Your required monthly payment amount will vary depending on how much you borrowed, the interest rates on your loans, and your repayment plan. Choose a repayment plan that best meets your needs.
The student must be a dependent of the parent borrower and must be under 24 years of age. Students 24 or older are not eligible to receive PLUS loan funds, but may borrow an unsubsidized Direct loan in the same amounts as listed above for a PLUS loan denial.
The deadline for parent PLUS loan applications varies by institution. The federal deadline for the FAFSA is June 30 of each award year, but many institutions have earlier deadlines. Check with your child's school to see when the deadline for completing a parent PLUS loan is.
Completing the Online Application: (Note: The online PLUS application for 2024-2025 should not be submitted before June 1, 2024.) You may apply for a Direct PLUS Loan at www.studentaid.gov.
To qualify, borrowers must have a dependent child enrolled at least half time in an eligible school. Unfortunately, grandparents and other relatives can't get a parent PLUS loan unless they legally adopt the student. While you don't need excellent credit to get a PLUS loan, you can't have an adverse credit history.
The monthly payment is set at 20% of your discretionary income, which is defined as the amount by which your income exceeds 100% of the poverty line. After 25 years of payments under income-contingent repayment, the remaining balance will be forgiven.
PLUS loans are not based on a family's income or assets and parents can borrow up to the total cost of education, minus any financial aid the student will receive. The student must be enrolled at least half time and be making satisfactory academic progress (Eligibility & Academic Standards).
Eligibility for Federal Parent PLUS Loans
Dependent student must be making satisfactory academic progress, such as maintaining at least a 2.0 GPA on a 4.0 scale in college. Parent and dependent student aren't in default on a federal student loan or grant overpayment.