The U.S. Department of Education makes Direct PLUS Loans to eligible parents through schools participating in the Direct Loan Program. (We also offer PLUS loans for graduate or professional students.) A Direct PLUS Loan is commonly referred to as a parent PLUS loan when made to a parent borrower.
Direct PLUS loans are federal loans that graduate or professional degree students or parents of dependent undergraduate students can use to help pay for education expenses.
Can I transfer the loan to my child for repayment? No. A Direct PLUS Loan made to you as a parent cannot be transferred to your child. You are responsible for repaying the loan.
With federal PLUS loans, the government will check for an adverse credit history, although there is still no minimum credit score requirement. Those who have a less-than-perfect credit history, however, may need to meet additional requirements to get approved.
To qualify for a parent Direct PLUS loan, your child must be an undergraduate student enrolled in an eligible college at least half time. You also have to pass a credit check or you may have to apply with a cosigner.
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 maximum Direct PLUS Loan amount that can be borrowed is the cost of attendance at your school minus any other financial assistance received.
Pay Off High-Interest Loans First
With this approach, you pay off your loans from the highest interest rate to the lowest. You make the minimum payments on each balance except the highest-rate loan. You also make an extra monthly payment based on how much you can put toward the debt.
Repayment of Parent PLUS Loans begins once the loan is fully disbursed to the school. You can request deferment on repayment, but interest will accrue during that time. Refinancing could lower your interest rate and change your repayment length.
The status of a Direct PLUS Loan can be found by either logging in to your account or by contacting your student loan servicer. Not sure who your loan servicer is? Log in to StudentAid.gov to view your servicer information.
- In order to receive a direct PLUS loan you must submit a FAFSA, and must be a graduate or professional student enrolled at least half-time at an eligible school in a program leading to a graduate or professional degree or certificate.
The parent of a dependent undergraduate student OR a graduate (masters/doctoral) student may apply. It is not based on income or financial need, and parents and graduate students may borrow up to the Cost of Attendance minus any financial aid received by the student.
The school will first apply the loan funds to the school account to pay for tuition, fees, room and board, and any other school charges. Any additional loan funds will be paid to the student as a credit balance (with your authorization) or sent to you.
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.
Payday loans are short-term loans that are typically $500 or less and are designed to be paid back by your next pay period. Most payday lenders don't check your credit, so these are among the easiest loans to get approved for.
Because interest is calculated against the principal balance, paying down the principal in less time on your mortgage reduces the interest you'll pay. Even small additional principal payments can help.
You must complete a Direct PLUS Application for each year you wish to receive a parent PLUS loan. Complete the Direct PLUS Loan Application.
Note: You can request an increase in the amount of a Direct PLUS Loan you previously requested if it's for the same school, same award year, and same student.
Most lenders state that their maximum personal loan amount is $50,000, though some will go as high as $100,000. Some borrowers, usually wealthy and with high credit scores, might be able to borrow more.
In addition, the graduate/professional student, the parent or the dependent student must not be in default on any federal education loans or owe an overpayment on a federal education grant, and must meet other general eligibility requirements for the Federal Student Aid programs.
How much can I borrow in Direct PLUS Loans? There are no set annual or aggregate limits. You may borrow up to your full cost of attendance, minus any other financial aid you receive (including Direct Subsidized Loans, Direct Unsubsidized Loans, scholarships, and certain fellowships).
Unlike federal loans for students, repayment for Parent PLUS loans begin immediately after you've received the last disbursement. If you'd rather push off your repayment period, you can ask for a deferment or forbearance while your student is still enrolled in school, or if you meet certain qualifications.