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The Federal PLUS Loan is a federal educational loan program which provides low-interest loans, available through private lenders, to parents (Parent PLUS Loan) of dependent undergraduate students and to graduate students (Grad PLUS Loan). The PLUS Loan is not a need-based loan or based on a specific income level. However, borrowers must demonstrate a satisfactory credit rating to participate. The borrower and student must be U.S. citizens, permanent residents, or eligible noncitizens and the student must be attending at least half-time (six credits per semester) in a degree-granting program.
For a comprehensive explanation of all PLUS Loan provisions and terminology, view http://studentaid.ed.gov and click on "Federal Student Aid Programs". The following information summarizes the basic PLUS Loan terms and conditions.
General PLUS Loan Provisions
Repayment Information
Application Procedures
PLUS borrowing is limited to the cost of education minus other financial aid resources. For the 2009-10 academic year, PLUS loans have a fixed interest rate of 8.5% which is set by the federal government. Repayment of principle and interest generally begins 60 days after full disbursement. The interest is not subsidized while the student is in school and will begin to accrue with the first disbursement. Federal regulations require a 1% Federal default fee and a 3% origination fee be deducted from the loan at disbursement.
To participate, borrowers must demonstrate a satisfactory credit rating according to federal guidelines and the lender's credit standards. The lender will determine an applicant's credit standing upon receipt of a PLUS Loan application. Applicants determined to have an adverse credit history, may receive a loan if the applicant obtains a credit worthy cosigner.
Repayment
The PLUS Loan repayment period begins 60 days after full disbursement of the annual loan amount. For example, a loan made for the 2009-10 academic year would be “fully disbursed” with the spring semester 2010 loan payment in early January, making the first loan payment of principle and interest due in early March 2010.
The monthly payment and the repayment period will depend on the amount borrowed. The minimum monthly payment will be at least $50, and the repayment period may extend up to 10 years.
Grad PLUS Loan borrowers enrolled on at least a half-time basis (6 or more credit hours) may receive a deferment for repayment of principle and interest during enrollment, and for up to 6 months after leaving school.
Parent PLUS borrowers may defer principle and interest payments while the undergraduate student on whose behalf they borrowed is in school and for a six-month period after the student graduates or drops below half-time enrollment. Payments can also be deferred while the parents themselves are enrolled in college at least half-time in a degree-granting program.
PLUS Application Procedures
To receive a PLUS Loan, the Free Application for Federal Student Aid (FAFSA) must be filed annually for the student. The borrower must choose a lender and complete a PLUS Loan Master Promissory Note (PLUS MPN) and the borrower must annually request a loan amount through their lender.
Although the FAFSA must be completed for each academic year, the PLUS MPN needs to be completed only once. The PLUS MPN is designed to serve as a multi-year note, over a maximum ten-year period, and can be used to process the borrower's PLUS Loan eligibility in subsequent years. Therefore, a borrower will need to complete the PLUS MPN only once during the student's enrollment at Alfred University.
Loan Counseling Required for Graduate Students: Entrance Counseling is a federal requirement for all Graduate PLUS borrowers. This counseling session will help graduate students understand the terms and provisions of the PLUS Loan and their rights and responsibilities as a borrower. PLUS Entrance Counseling only needs to be completed once, prior to receiving the first Grad PLUS Loan.
- To file the FAFSA, click here.
- To choose a PLUS Loan lender and complete the PLUS Loan MPN, click here.
- To complete the required Graduate Student Entrance Counseling, click here.
For the 2009-10 academic year, Alfred University will only offer Entrance Counseling in the on-line format made available through Mapping Your Future. Once you have completed the entrance counseling, printed a confirmation page, and clicked exit, you will be directed to Alfred University's recommended PLUS Loan Lender List, to choose a lender and complete a PLUS Loan Master Promissory Note (MPN). If you have already done this, just exit, as it would not be necessary to complete the MPN again.
Please Note: Both the entrance counseling and the PLUS Loan MPN must be completed before your loan can be certified. Also, Alfred University will be notified electronically when you have completed entrance counseling.
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