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What Is A Direct PLUS Loan?

  • William D. Ford Direct PLUS Loans are borrowed by the parent of a dependent student.  The parent does not have to demonstrate financial need, but must not have an adverse credit history as determined by a credit check. [More]https://studentaid.ed.gov/sa/types/loans/plus
  • The William D. Ford Direct Loan Program was created by Congress and the U.S. Department of Education to help eligible students and parents, with and without financial need, pay for educational expenses.

  • A loan is money a parent borrows to pay for a dependent student’s educational expenses and must be paid back with interest.

  • The U.S. Department of Education is the lender; however, it contracts with other companies and agencies to service your parent’s Direct PLUS Loans.

Is My Parent Eligible For A PLUS Loan?

  • To receive a PLUS Loan, the borrower must
  • Be the parent (biological, adoptive, or in some cases, stepparent) of a dependent undergraduate student enrolled at least half-time;
  • Not have an adverse credit history; and
  • Meet basic eligibility requirements, along with the student, for Federal Student Aid

Can My Parent Receive A Direct PLUS Loan If He/She Has An Adverse Credit History?

  • A credit check is necessary to receive a parent PLUS Loan. A parent with adverse credit history, may still receive a Direct PLUS Loan through one of the following alternatives:

  1. Obtain an endorser who does not have an adverse credit history. An endorser is someone who agrees to repay the Direct PLUS Loan if the parent does not repay it.
  2. Document there are extenuating circumstances relating to the parent’s adverse credit history.
    • With either alternative, the parent must complete credit counseling for PLUS loan borrowers on the https://studentaid.gov/website.

Does My Parent Need To Borrow A Loan?

  • Your parent is NEVER required to borrow a loan.  However, a parent may choose to borrow a parent PLUS Loan if the educational costs are greater than financial aid awarded their child.

Direct Loan Interest Rates https://studentaid.ed.gov/sa/types/loans/interest-rates

Direct Loans Origination Fees https://studentaid.ed.gov/sa/types/loans/interest-rates

Where can I get more information about Direct Loans?

For more information on loans terms and conditions and repayment options, go tohttps://studentaid.ed.gov/sa/types/loans