The Parent PLUS Loan is a federal loan designed to help parents cover the cost of their child’s undergraduate education when other financial aid falls short. Offered by the U.S. Department of Education, this loan allows parents of dependent students to borrow funds to pay for tuition, housing, and other college expenses.
How to apply for Parent PLUS Loan
To apply successfully, parents must complete several steps, starting with the Free Application for Federal Student Aid (FAFSA). Before applying for a Parent PLUS Loan, the student must have a FAFSA on file, as this form determines eligibility for federal student aid and ensures that all other funding options have been considered.
Once the FAFSA is submitted, the next step is for the parent to create or retrieve their Federal Student Aid (FSA) ID. This unique login allows access to federal loan applications and ensures secure processing. Parents must use their own FSA ID, separate from their child’s, to complete the application. The application process itself takes place on the Federal Student Aid website at studentaid.gov.
After logging in, parents should navigate to the Direct PLUS Loan Application for Parents section, where they will provide details about themselves, their child, and the loan amount requested. The application also requires a credit check to determine eligibility.
If approved, parents will move on to the next step, while those denied may have the option to appeal the decision or secure an endorser.
Following approval, the parent must sign a Master Promissory Note (MPN), a legal document outlining the terms of the loan and repayment responsibilities. Signing this agreement confirms that the borrower understands their obligations.
Once the MPN is signed, the school will disburse the loan funds directly to cover tuition and other institutional costs. If there are remaining funds after tuition is paid, the school will refund the excess amount to the parent or student, depending on the disbursement preference chosen during the application process.
When does repayment begin?
Repayment on Parent PLUS Loans begins immediately, but parents can request a deferment while their child is enrolled at least half-time. Loan repayment options vary, with standard, graduated and extended plans available to fit different financial situations.
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