Frequently Asked Questions

Once your child's FAFSA is processed, s/he will receive his/her Student Aid Report (SAR). This report will detail the Expected Family Contribution (EFC).

The federal government prescribes an official federal EFC calculation. This calculation determines family resources available from a family's income and assets. A portion of these available amounts are considered as EFC.

• Tuition
• Fees
• Transportation
• Room and Board
• Miscellaneous and personal
• Computer (upon request)
• Student loan fees
• Study abroad (if applicable)
• Other special program fees
• Books and supplies
• Expenses for students w/ disabilities (if applicable)

The school determines how and when the funds will be disbursed. The school can receive the funds electronically or by paper; it depends on how the school is set up to receive the funds.

No, you are not required to take out a PLUS loan.

You would need to apply if your child has used all his/her subsidized Stafford funds for that academic year and still has a financial shortfall.

No, you can borrow up to the full cost of education minus any other form of financial aid received by the student.

Yes. To be eligible to receive a PLUS loan, you will need to pass a credit check.

You can appeal the credit decision, obtain an endorser for the PLUS loan, or the student can apply for an unsubsidized Stafford loan.

You, the parent, are responsible for repayment of the loan.

You can instruct the school to return or cancel any remaining disbursements.

Yes, if it is determined more funds are needed to pay the educational cost.

No, you can only borrow what the school has certified.

Yes, your pre-approval decision is good for 90 days on our system. You will need to apply within 90 days or you will need to go through the pre-approval process again.

For loans first disbursed on or before June 30, 2006, the interest rate can change each year of repayment. By law, it will never exceed 9%. The interest rate is adjusted each year on July 1. You will be notified of interest rate changes throughout the life of the loan. For loans first disbursed on or after July 1, 2006, the interest rate is fixed at 8.5%.

Yes, there is a 3% origination fee and a 1% federal default fee. These fees will be deducted from the loan amount.

Yes, as long as their loans do not exceed the cost of the child's education.

Generally, repayment begins within 60 days after the final loan disbursement. There is no grace period. Interest begins to accumulate at the time the first disbursement is made.

There are four repayment plans offered on the PLUS loan; they are:

1. Standard Repayment - requires you to pay a set amount monthly (with a minimum of at least $50) for up to a maximum of 10 years. However, this set amount may be changed depending on your interest rate, number of payments, and total principal balance.

2. Income Sensitive - is adjusted yearly according to your annual income and the amount of your loan. If this plan requires more than 10 years to complete your repayment, your lender can put your loan in forbearance to lengthen your repayment time up to five additional years.

3. Graduated Repayment - begins with smaller monthly payments, and then enlarges the payments over 10 years. The amount of your loan determines how often and by how much your payments increase.

4.  Extended Repayment - allows for the repayment period to be extended for up to 25 years. You must be a new borrower on or after 10/7/98 with FFELP loans totaling more than $30,000. You may choose to make standard or graduated payments under this plan.

Your monthly payment depends on the repayment plan you choose. The minimum monthly payment is $50 for a standard repayment plan.

Yes. Under certain circumstances, parents can receive a deferment or forbearance on their loan. However, since all PLUS loans are unsubsidized, parents will be charged interest during periods of deferment or forbearance. If you do not pay the interest as it accrues, it will be capitalized to the principal balance at the end of the deferment or forbearance period.

No, there is no penalty for early pay off.