PLUS Loan for Parents of Undergraduates
A Parent PLUS loan is a loan that allows a parent with a good credit history to borrow money to pay educational expenses for their dependent children who are undergraduate students and enrolled in classes at least half-time. The federal government is the lender.
What are the eligibility requirements?
- The student must have a FAFSA on file with Wayne State University.
- The student must be enrolled at least half-time and meet the federal student eligibility requirements for financial aid.
- The parent must meet the same citizenship requirements as the student and must not be in default on a federal student loan.
How do I apply?
- The parent borrower applies by completing the Parent PLUS Loan Application:
The parent/step-parent who is borrowing the loan must login with the Parent FAFSA PIN to start the online application.
- 2011-12 Parent PLUS Loan Application online at studentloans.gov
- 2012-13 Parent PLUS Loan Application online at studentloans.gov - coming in early May 2012
- The parent borrower must also complete the Federal Direct Parent PLUS Loan Master Promissory Note (MPN) online at studentloans.gov.
- Note: If you applied for a PIN using your first initial, you must either use the first initial when completing and signing your promissory note, or update your PIN at www.pin.ed.gov.
How much can I borrow?
The academic yearly limit on a PLUS loan is equal to the student’s cost of attendance minus any other financial aid, including scholarships the student receives.
What is the interest rate and loan fee?
The current interest rate on a Parent PLUS loan is 7.9%.
A loan fee of 2.5% will be deducted from the loan proceeds prior to disbursement. Effective July 1, 2012, the loan fee will increase to 4%.
When does repayment start?
Repayment on the loan starts either 60 days after the loan is fully disbursed, or six months after the dependent student ceases to be enrolled on at least a half-time basis.
The borrower also has the option to make interest-only payments while the student is in school. For deferment options, please contact the loan servicer or visit the Federal Student Aid website.
How is the loan disbursed?
Funds are electronically transmitted to WSU and applied to the student's tuition account. Excess funds, if any, are issued via check and mailed to the parent borrower. Parent PLUS borrowers who want excess funds issued directly to their son or daughter must inform our office of this during the application process.