Federal Direct Parent PLUS Loan

• Authorization Statement

The Federal Direct Parent PLUS Loan is a credit-based government-sponsored fixed interest loan. A FAFSA is not required to obtain a Federal Direct Parent PLUS Loan. However, it is recommended to complete a FAFSA to determine if the student has any Federal Direct Subsidized/Unsubsidized Loan eligibility. A credit check is required for approval of this loan.

Loan Limits: Cost of attendance minus other financial aid. The amount borrowed may replace the expected family contribution.

Interest Rate: Fixed at 7.9% with interest beginning to accrue upon disbursement.

Loan Fees: The Federal Direct Parent PLUS loan has a 4% origination fee with an up-front rebate of 1.5%, for a net origination fee of 2.5% which is deducted from the loan proceeds. Once the borrower enters repayment, they are eligible to keep the rebate if they make their first 12 payments on time. If they fail to make all 12 payments on time, the rebate fee is capitalized into the principal of the outstanding loan balance.

Loan Eligibility: Parent borrower must be a U.S. citizen or eligible non-citizen and have a satisfactory credit rating. Student must be dependent, an eligible citizen or non-citizen and enrolled at least half-time.

Disbursement Terms: In a typical academic year, Federal Direct Loans are disbursed in two installments. When the academic period is for one semester or for the summer term, one disbursement is permitted at the beginning of the term. During the regular academic year (Fall/Spring Semesters) funds cannot disburse more than 10 days prior to the first day of class. For the summer term, funds cannot disburse more than 5 days prior to the first day of class.

Grace Period: Repayment typically begins 60 days after the final disbursement of the loan. Parents may request an in-school deferment with the Department of Education. If the deferment is approved, repayment will begin 6 months after the student completes their program. If parent has an approved deferment and the student drops below half-time enrollment or withdraws from the University, the parent borrower will enter into their 6 month grace period prior to repayment of their loan.