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PLUS Loan

PLUS Loan
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PLUS Loans help undergraduate students and Graduate and Professional Students to be able to attend college and attain their academic ambitions without having to wait until they can afford to pay out-of-pocket. This is very encouraging because people can attend universities and colleges without delaying until they can pay from income and savings. Both young and old alike can now achieve their dreams without waiting until they can afford to pay for their education which gives a chance to all including dependants.

For a dependent undergraduate the parent assists the student to pay for education by taking loans. A parent of a student who is attending college or university can apply for a PLUS Loan which is given by the U.S. Department of Education. The loan covers all education costs and expenses. The amount given should be less any financial aid awarded in terms of grants, scholarships and work-study. Grants and scholarships are not paid back but loans have to be paid back with interest. The loan is a student loan applied and paid for by the parent not the student. The student with the help of the parent must fill a Free Application for Federal Student Aid form which can be filled online or downloaded from the Departments website.

A PLUS Loan for parents accrues interest after the first full payment is disbursed. The loan repayment is 60 days after the first full payment. To be able to qualify for the loan, the student must be at least in half-time enrollment and be a dependent undergraduate. The parent can apply for deferment and if this is not granted can apply for forbearance.

Graduates and Professional Degree Students are now able to borrow Direct PLUS Loans to pay for the cost of education. The Direct PLUS Loan is a federal student loan given by the U.S. Department of Education. The loan covers the total cost of education less any financial aid received. The interest rate is fixed at 7.9%. This is not a need-based loan but is credit-based and the student credit history is considered when granting the loan unlike undergraduate federal loans where the student's financial need and the family's income and ability to pay is considered. The graduates and professional students will not be able to apply for additional Stafford Loans if the Grad PLUS Loan is not approved because of their credit being adverse. The advantage is that the loan can be deferred until the student finishes school.

Graduates can apply for the loan to pay for the cost of education and other education related expenses less any financial aid. They may use the loan to pay for tuition, room and board and pay for books, supplies, transport, laboratory expenses and other education expenses.
To receive a PLUS Loan the college or university must verify the amount. They will check the eligibility of Stafford Loans whether subsidized or unsubsidized to see if the student can apply for them since the interest rate is lower.

Last modified onTuesday, 02 April 2013 16:03
More in this category: « Scholarship Education Loan »

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