Federal Direct Parent PLUS Loan Process
Federal Direct Parent PLUS Loan – is a federal loan available to parents of dependent undergraduate students to help them pay for their child’s college education. The Parent PLUS application process requires a credit check. The Direct Parent PLUS loan has a fixed interest rate. Loans disbursed between July 1, 2014 and June 30, 2015 have an interest rate of 7.21%. with a 4.292% fee deducted at the time of disbursement. For more information on interest rates and fees, visit: http://www2.ed.gov/offices/OSFAP/DirectLoan/calc.html.
- A first time Parent PLUS borrower must complete a Parent PLUS Master Promissory Note (MPN.) The parent will need information including a Department of Education Personal Identification Number (PIN) to sign the PLUS MPN. If they do not have a PIN or forgot their PIN, they should request one at the PIN website, http://www.pin.ed.gov.
- A FAFSA must be submitted before a Parent PLUS loan can be processed. The FAFSA can be filed at http://www.fafsa.gov.
- Beginning May 1, parents may apply for the summer term at www.studentloans.gov.
- Beginning June 1, parents may apply for the academic year that starts that fall. Sign in and apply online at www.studentloans.gov.
- To begin the application process, sign in with your PIN then select "Request PLUS Loan." Please complete the PLUS application and the PLUS MPN with the parent as the PLUS borrower, not the student. Only first time PLUS borrowers are required to complete a PLUS MPN in addition to the PLUS application. To do this, select the option to complete a Master Promissory Note for a Parent PLUS loan. Please note that a PLUS Loan will not be certified unless both an approved credit decision AND valid PLUS MPN exist for a PLUS borrower. If a Parent PLUS application is denied, the parent has the option to include an endorser/co-signer on the application or appeal the credit decision with the Department of Education. An endorser is a person who agrees to repay the PLUS loan if the borrower defaults on payments. If a parent chooses to add an endorser to the PLUS application, the endorser must complete an Endorser Addendum which requires the endorser to undergo a credit review. In addition, a borrower choosing to add an endorser or appeal the credit decision must also complete a PLUS MPN if the application becomes approved. A borrower must complete a new application and PLUS MPN for each PLUS loan borrowed with an endorser.
- Beginning on March 29, 2015, The Department of Education will require PLUS Loan counseling for any PLUS applicant who has an adverse credit history, but who qualifies for a PLUS Loan through the appeal process, or by obtaining an endorser for the loan. PLUS applicants who do not go through the appeal process, or do not have an endorser may complete PLUS Loan counseling voluntarily. PLUS Loan Counseling must be completed via www.studentloans.gov.
- If the parent decides not to add a co-signer, a dependent student becomes eligible for additional unsubsidized loan funds. The parent denied the PLUS loan should complete the Parent PLUS Denial form and submit it to the UWM-Financial Aid Department to request consideration for these additional loan funds. However, this step/form is not necessary if the parent chose the option to request additional unsubsidized loan during the PLUS application process.
- We will be notified if you are approved for the Parent PLUS loan. The processing time frame (awarding to disbursement) is generally two weeks from the date of your loan approval. Often the time frame is longer for those who wait until they see the charges reflected on the students billing statement. To check if you have completed both the PLUS application process and MPN successfully, please go to www.studentloans.gov and select completed MPNS and Direct PLUS loan applications.
- During the application process you will be asked to indicate how much you intend to borrow. You have the option of selecting the maximum amount you are eligible for, an unknown amount, or you may indicate a specific amount. Please note, that if you indicate an unknown amount the Financial Aid Department will process your loan for the maximum amount you are eligible for. This will be the student's Estimated Cost of Attendance less any aid they are receiving.
- In some instances the Department of Education may place a PLUS application in a pending status instead of a denial/approved status. Typically, a pending decision indicates additional information is required from the Department before a final credit decision can be made. A borrower who receives a pending credit result instead of a denied/approved decision must contact the Financial Aid Department for additional information. Disclosure of Loan Terms for Direct Plus Loans