Parent & Graduate PLUS Loans

The Federal Direct PLUS Loan - This is an education loan for parents of undergraduate students. The parent is the sole borrower, not the student. The Direct PLUS Loan has a fixed interest rate of 6.41%. There is also a 4.288% origination (up front) fee that is deducted by the government from each loan disbursement. The origination fee may be included in the amount borrowed. To determine the gross amount to borrow including the fee, divide the amount you need to cover your costs for the year by .9571.

The student must file the FAFSA is order for the parent to borrow the PLUS Loan.

Application Instructions for New PLUS Loan Borrowes- To apply, the parent borrower MUST:

  1. Complete the Borrowing Intention Form (BIF) included with the financial award package* and return it to the Financial Aid Office (FAO) for processing. By waiting until the package is received, you'll know the total amount you need to borrow to cover the annual expenses. Request the amount to be borrowed for the academic year. This will prevent having to complete two credit checks in one academic year. The funds are equally disbursed between the fall and spring semesters.  

    The pre-approval process for 2014-2015 will be available by April 15, 2014 - The credit history check will expire 90 days after completing the pre-approval process. 
  2. Complete the pre-approval process online at studentloans.gov. Click SIGN IN located in the top left margin and go through the log-in process (the parent will need his/her FAFSA 4-digit PIN in order to Sign In).  Click on Request PLUS loan to go through the Pre-Approval process. If pre-approved, the parent must complete the Master Promissory Note (MPN). Instructions on how to do so will be provided after finishing the pre-approval process.  The amount listed on the BIF is the amount that will be certified by the FAO.

Application Instructions for Current PLUS Loan Borrowers (including transfer students) - Do not apply prior to receiving your financial award package to be sure of the amount you need to borrow. In addition, the credit history check will expire 90 days after completing the pre-approval process. The Financial Aid Office will not begin processing PLUS Loans until July 2014.

To apply, the parent borrower should:

  1. Complete the Borrowing Intention Form (BIF) included with the financial award package* and return it to the Financial Aid Office (FAO) for processing. By waiting until the package is received, you'll know the total amount you need to borrow to cover the annual expenses. Request the amount to be borrowed for the academic year. This will prevent having to complete two credit checks in one academic year. The funds are equally disbursed between the fall and spring semesters.  

    Complete the pre-approval process online at studentloans.gov. Click SIGN IN located in the top left margin and go through the log-in process (the parent will need his/her FAFSA 4-digit PIN in order to Sign In).  Click on Request PLUS loan to go through the Pre-Approval process. The amount listed on the BIF is the amount that will be certified by the FAO.

*PLEASE NOTE: You must complete the aid application process before you will receive a financial award package. You may access the forms under Documents on the left menu bar. Please contact our office if you are not planning to apply for financial aid, finaid@lvc.edu.

Advantages of the Direct PLUS Loan include:

  • Qualifications are based solely on good credit, and there are no debt-to-income ratio or employment verification requirements.

  • The maximum amount you may borrow is equal to the cost of attendance minus other financial aid (Pease note: the cost of attendance includes the estimated expenses for books, transportation and personal, not just billable charges).

  • Flexible repayment terms with up to 10 years to repay the loan. For loans disbursed after July 1, 2009, parents may choose to defer payments until six months after the date the student ceases to be enrolled at least half time. Accruing interest may either be paid by the parent borrower monthly or quarterly, or be capitalized quarterly. To request a deferrment, the borrower must wait until after the first disbursement of the loan (8/20/14 for fall 2014 and 1/7/15 for spring 2015) and then contact the loan servicer for instructions. To determine the loan servicer and for a centalized view of federal loans, the borrower should create an account with the National Student Loan Database (NSLDS), the U.S. Department of Education's central database for federal student aid providing loan and/or grant amounts, outstanding balances, loan statuses, disbursements, as well as lender and servicing and agent contact information.
     
  • Interest may be tax deductible. 
     
  • No penalty for early repayment or payoff.
     
  • The student is eligible to borrow additional Unsubsidized Direct Stafford Loan funds if the PLUS Loan is denied (more information below). 
     
  • Provides a built-in insurance for death and disability that applies to both the borrower and the student at no additional cost. 
     
  • You may opt to do a combination of both the Direct PLUS Loan and the HES payment plan.

If the parent is denied the Direct PLUS Loan, you (the student) are eligible to borrow additional funds through the Unsubsidized Direct Stafford Loan program ($4,000/year for freshmen and sophomores and $5,000/year for juniors and seniors). You must complete the BIF if you would like to borrow these funds. No additional Direct Loan funds will be processed without a completed BIF on file.

Federal Direct Graduate PLUS Loan  

No Subsidized Loan Eligibility for Graduate and Professional Students

Effective for loans made for periods of enrollment (loan periods) beginning on or after July 1, 2012, graduate students are no longer eligible to receive Federal Direct Subsidized Loans. The annual loan limit remains unchanged at $20,500, but this amount will now be limited to Direct Unsubsidized Loans. This change is a result of The Budget Control Act of 2011 that was signed into law August 2, 2011. 

2014-2015 Graduate PLUS Loan

The Federal Direct Graduate PLUS is a federal loan for graduate students enrolled a minimum of 6 credits per semester. It offers excellent repayment terms and a fixed interest rate of 6.41%. There is also a 4.288% origination fee that is deducted by the government from each loan disbursement. The origination fee may be included in the amount borrowed. To determine the gross amount to borrow including the fee, divide the amount you need to cover your costs for the year by .9572.

Students choosing to borrow through the Graduate PLUS Loan should do so upon reviewing the financial award package which is mailed in early July. By waiting until the package is received, you'll know the total amount needed to cover annual expenses. The Financial Aid Office recommends applying for the full year rather than on a per semester basis. By doing so, you will only have to complete one pre-approval process per academic year.

Interest on Graduate PLUS Loans begins accruing after the first disbursement. After the loan is fully disbursed, your federal loan servicer will automatically add an in-school deferment  and a 6 month post-enrollment deferment. Interest is NOT capitalized until the end of the post-enrollment deferment period.

To apply please visit www.studentloans.gov and sign in using your Federal PIN (the same one you used to sign the FAFSA). You should then click on Start the PLUS Application Process and then Graduate PLUS. Complete the pre-approval process and sign the Master Promissory Note (MPN-necessary only if you are a first-time borrower). Our office will be notified electronically.

First-time borrowers are also required to complete Entrance Counseling. You may do this online at www.studentloans.gov. Click on Complete  Entrance Counseling. You will be able to indicate that you are a graduate student. Our office will be notified electronically.