Where do I apply for a Parent PLUS loan?
The Parent PLUS loan program provides an avenue for parents to borrow money to fund their child’s education. These loans are offered by the U.S. Department of Education and can be a valuable resource for families who are unable to cover the full cost of college expenses. If you are considering applying for a Parent PLUS loan, you may wonder where to begin the application process. Let’s dive into the details and explore the steps to apply for a Parent PLUS loan.
To apply for a Parent PLUS loan, you will need to follow these steps:
1. Complete the Free Application for Federal Student Aid (FAFSA): Your child must have a FAFSA on file to be eligible for a Parent PLUS loan. The FAFSA determines their eligibility for federal financial aid, including grants, scholarships, work-study programs, and federal student loans.
2. Create an FSA ID: Visit the Federal Student Aid website and create an FSA ID, which will serve as your electronic signature for all federal student aid applications.
3. Visit StudentAid.gov: Navigate to the official website for federal student aid to access the online application.
4. Log in: Use your FSA ID to log in to the website.
5. Select “Apply for a PLUS Loan”: Choose the “Apply for a PLUS Loan” option located under the “Apply for Aid” tab.
6. Provide your child’s information: Enter your child’s details, including their name, Social Security number, and school information.
7. Specify loan details: Choose the loan type you want to apply for (Parent PLUS loan) and indicate the loan amount you wish to borrow.
8. Complete the Loan Agreement (MPN): The Loan Agreement, also known as the Master Promissory Note, is a legal document that explains the terms and conditions of the loan.
9. Authorize a credit check: You will need to authorize a credit check as part of the application process. If you have an adverse credit history, you may still be eligible for a Parent PLUS loan by obtaining an endorser or appealing the credit decision.
10. Submit the application: Review all the provided information for accuracy and submit your application.
11. Complete Entrance Counseling: If it is your first time receiving a Parent PLUS loan, you will need to complete entrance counseling, which provides information about your rights and responsibilities as a borrower.
12. Await loan approval: After submitting your application, the U.S. Department of Education will assess your eligibility and creditworthiness to determine if you qualify for the Parent PLUS loan.
Now, let’s address some frequently asked questions about the Parent PLUS loan:
1. Can I apply for a Parent PLUS loan if I have bad credit?
Yes, you can still apply for a Parent PLUS loan with bad credit, but you may need an endorser or follow the credit appeal process.
2. Do I need to be employed to qualify for a Parent PLUS loan?
No, you do not need to be employed to be eligible for a Parent PLUS loan. However, you should have a steady source of income or other means to repay the loan.
3. Can I use a Parent PLUS loan to cover my other child’s college expenses?
No, the Parent PLUS loan is specifically for the child listed on the application.
4. What is the current interest rate for Parent PLUS loans?
The current fixed interest rate for Parent PLUS loans is set at 6.28% for the 2021-2022 academic year.
5. When do I start repaying a Parent PLUS loan?
Repayment typically begins within 60 days after the loan is fully disbursed. However, you may request a deferment while your child is enrolled at least half-time.
6. How long does it take to process a Parent PLUS loan application?
The processing time for a Parent PLUS loan application varies, but it typically takes around 7-10 business days.
7. Can I transfer a Parent PLUS loan to my child?
No, Parent PLUS loans cannot be transferred to your child. The debt remains solely the parent’s responsibility.
8. Are there any loan forgiveness options for Parent PLUS loans?
Parent PLUS loans are not eligible for most federal loan forgiveness programs. However, there may be certain forgiveness options available in specific circumstances.
9. Can I cancel a Parent PLUS loan if I change my mind?
Yes, you can cancel a Parent PLUS loan or reduce the loan amount if it has not been disbursed or used for educational expenses.
10. Can I apply for a Parent PLUS loan for graduate or professional studies?
Yes, graduate or professional students’ parents can apply for a Parent PLUS loan to help finance their child’s educational expenses for advanced degrees.
11. Are there any origination fees for Parent PLUS loans?
Yes, there is a loan fee deducted from the loan amount. The loan fee percentage varies each year, so check with the U.S. Department of Education for the most up-to-date information.
12. Can I change the loan amount after submitting the application?
Yes, you can request a change in the loan amount by contacting the school’s financial aid office. They will guide you through the required steps.