For consideration, submit your application before July 1, 2025, midnight Central time (CT). There are two term applications available. To be considered for the fall term application, apply before July 1, 2025, midnight CT. For the spring term application, apply by Jan. 10, 2026, midnight CT.
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.
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.
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.
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.
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.
The $100,000 Loophole.
With a larger below-market loan, the $100,000 loophole can save you from unwanted tax results. To qualify for this loophole, all outstanding loans between you and the borrower must aggregate to $100,000 or less.
Parent PLUS Loan borrowers can have their debt forgiven after 10 years of working full-time for the government, nonprofit, or other qualifying employers. For the past year, retired public servants could submit an application to get retroactive credit towards the Public Service Loan Forgiveness Program.
The maximum PLUS loan amount you can borrow is the cost of attendance at the school your child will attend minus any other financial assistance your child receives. The cost of attendance is determined by the school.
PLUS loans don't require good credit, making them an ideal option for low-credit borrowers. However, you can't have an adverse credit history, such as bankruptcies or loan defaults within the past five years.
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.
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.
Federal Tax Information
The following data received by the Department from the IRS are considered FTI: Tax Year (ex. Award year 2025-26 is based on 2023 tax year information from the IRS) Tax Filing Status.
Some states and schools continue to award aid to FAFSA latecomers, but your chances get much slimmer, and the aid is often lower. You may still be eligible for a Federal Pell Grant. If you miss the June 30 federal deadline, you're no longer eligible to submit that year's FAFSA form.
If your parents are married and filed taxes jointly, for instance, only one parent needs to contribute to the form (although they need to report information for both parents). If your parents are married and filed taxes separately, then both will need to contribute to the FAFSA.
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.
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.
Based on the information from Federal Student Aid, as of 2022, the average Parent PLUS Loan debt is $29,528. Although that might not sound like a huge amount, it depends on the parent's income.
If someone else pays off your mortgage or another significant debt, it could be considered a gift under tax laws.
A loan between family members, or even friends, isn't help—it's a trap for both parties. Whenever you loan money to a friend or family member, you've become their creditor. You're now a lender, and they're a borrower.
Unlike all other federal student loans, there are no explicit borrowing limits for parent PLUS loans. Parents may borrow up to the full cost of attendance, which is determined by the institution, not the government, and includes books, travel and living expenses. There are no ability-to-repay standards for PLUS loans.
Parent PLUS loans are educational loans, and the borrower can get an income tax deduction. When borrowers review their tax deductions, they can deduct up to $2,500 per year in interest paid on the Parent PLUS loan.
Refinancing. If you have good credit and enough household income to qualify, you may also be able to refinance your Parent PLUS loan to a lower interest rate through a private lender, which can potentially save you money.