Federal Parent Loans (PLUS)
Long-term federal loans for parents of undergraduate students. Parents may borrow up to the full cost of attendance - as established for students by the university - minus any financial assistance the student receives. Borrowers must be US citizens or permanent residents and demonstrate creditworthiness for loan approval. These loans are not need based and interest accrues while the student is enrolled. Principal and/or interest payments may be deferred until after the student is not enrolled or is enrolled less than half-time.
Application- Submit a FAFSA to apply and complete a PLUS Loan Request (beginning July 15th for 2012-13). If the loan request is denied as a result of the credit check, the borrower may pursue a co-signer or request that the student receive the maximum additional student loan. See Endorse Direct PLUS loan.
Interest Rate - 7.9% fixed interest rate
Loan Fees - 2.5% deducted from the loan amount until July 1, 2012. After this date, fees will be 4%.
First Time Borrower Requirements - A Master Promissory Note(MPN) must be completed the first time you apply for a Federal Direct PLUS. The MPN defines the conditions under which you are borrowing and the terms under which you agree to pay back the loan.
Receiving Loan Funds -Loan funds are credited to the student’s billing account. Any PLUS funds remaining after charges are paid will be given to the student unless the parent borrower requests the excess funds. This request is made when the application is submitted.. If the student is on an Education Abroad Program (EAP), the funds will always go to the parent.
To receive funds, the student must have a permanent address in MyUCSC. The permanent address must be set to “active” before the loan will disburse. To avoid delays, be sure this address is current and active.