2024 What is Parent PLUS Loans?

When a parent borrower receives a Direct PLUS Loan, it is frequently referred to as a parent PLUS loan.

Direct PLUS loans can help pay for educational expenses that are not covered by other forms of financial aid. The U.S. Department of Education provides Direct PLUS Loans to qualifying parents through institutions that participate in the Direct Loan Program. (We also offer PLUS loans to graduate and professional students.)

Before applying for a PLUS loan, ensure sure your child has completed the Free Application for Federal Student Aid (FAFSA®) form.

Who Is Eligible for Parent PLUS Loans

To get a parent PLUS loan, you need

  • Be the biological or adoptive parent (or, in some situations, stepparent) of a dependent undergraduate student enrolled at least half-time in an approved school;
  • Not have a bad credit history (unless you meet certain extra standards);
  • Meet the general eligibility requirements for federal student aid.

Note: Grandparents (unless they have legally adopted the dependent student) and legal guardians are ineligible for parent PLUS loans, even if they have major responsibility for parenting the student.

Parent PLUS Loan Interest Rates and Fees

The interest rate for Direct PLUS Loans that are disbursed on or after July 1, 2023 but before July 1, 2024 is 8.05%. This is a set interest rate for the duration of the loan.

All Direct PLUS Loans include a loan charge. The loan charge is calculated as a percentage of the loan amount and eliminated proportionally from each loan payout. The percentage of all Direct PLUS loans disbursed on or after October 1, 2020 is 4.228%. Loans disbursed before that date had varying loan fees.

Loan Amount Limits

The maximum PLUS loan amount you can borrow is the cost of your child’s attendance at the school, minus any additional financial aid they receive. The fee of attendance is set by the school.

When to Make Loan Payments

If you apply for a deferment, you will not be responsible for payments for the six months following your child’s graduation, leave of absence, or reduction in enrollment below half-time as well as for the duration of your child’s enrollment at least half-time.

If the school your child attends asks you to submit a request for a parent PLUS loan through StudentAid.gov, you will be able to request a deferment throughout the loan application process. You can also contact your loan servicer and request a deferment.

If you do not request a deferment, you will be expected to start paying payments once the loan is fully disbursed (paid out).

During periods of deferment, interest will be charged on your loan. When it comes time to make payments, you can either pay the accrued interest or allow it to be capitalized (added to your loan principle sum). Your loan servicer will tell you when the first payment is due.

Read more: 2024 How to Apply for Parents PLUS Loan 

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