About Federal PLUS Loans

Federal PLUS Loans are low interest loans for parents offered through the Federal Family Education Loan Program.  PLUS loans enable parents to borrow money to help pay the postsecondary educational expenses of their children. In order to obtain a PLUS loan, parents must pass a credit test or obtain an endorser who is able to pass the credit test. The annual limit on a PLUS Loan is equal to the student's cost of attendance minus other financial aid. Parents can borrow for multiple children in the same year.  The Federal PLUS Loan has a fixed interest rate.

Disbursements

Disbursements are made to the school either by Electronic Funds Transfer (EFT) or by check made co-payable to the borrower and the school. The funds may be credited to the student's account, paid to the borrower or a combination of both.

Repayment

Repayment begins within 60 days after the loan has been fully disbursed, however interest is charged on the loan from the date of the first disbursement until the loan is paid in full. Once you enter repayment, you will be notified of your repayment terms and provided with information about deferments and forbearance (temporary cessation or reduction of payments) that you can request in special circumstances.  PLUS loans are typically set up with a standard repayment term.  A standard repayment term requires a minimum monthly payment amount of $50 and a maximum repayment term of 120 months.  Other repayment terms are available and can be discussed and requested through your loan servicer.

Interest Rate and Fees

The interest rate for Federal PLUS Loans is fixed at 8.5%. There is a 1% federal default fee and a 3% origination fee for Federal PLUS Loans.