Direct Parent Plus Loans
ABOUT THE FEDERAL DIRECT PLUS LOAN
The Federal Direct PLUS Loan is a loan for parents of dependent undergraduate students. This loan supplements the Federal Direct Student Loan Program, helping families pay the cost of post-secondary education. For more information, refer to the Student Loan Fact Sheet.
- Interest for a Direct Parent PLUS Loan is incurred and repayment begins 60 days after the loan has been fully disbursed, but you may be eligible to delay payments annually while your student is in school.
- Contact the servicer of your loan to make arrangements to utilize "forbearance" which defers payments. Forbearance can be requested and granted each year until the student leaves school or graduates.
- Repayment is 10 years with a fixed interest rate. The interest rate on new loans is adjusted on July 1 of each year by the U.S. Federal Department of Education.
- Federal Direct Parent PLUS Loan funds will be disbursed in the form of Electronic Funds Transfer (EFT) which are sent directly to the university. Each PLUS loan will be disbursed in two equal payments within the first week of each semester. If a PLUS is not processed until after the term begins, the first disbursement will occur as soon as possible after all steps are completed.
- A check of the borrower's credit history is required. If a borrower's credit is not strong enough for the loan to be approved, they can apply with an endorser (co-signer) in an effort to get a PLUS Loan approved.
- All loans borrowed will be reported to the National Student Loan Data System (NSLDS), a secure federal website that maintains the history of all federal aid awarded. This site may be accessed by authorized agencies, lenders and institutions.
Direct Parent PLUS Loan Qualifications
In order to determine if you are eligible to borrow a Federal Direct PLUS Loan for your student attending Capital University, review the following requirements:
- Your student has been admitted or is currently attending Capital University.
- Your student has applied for federal financial aid through the FAFSA.
- The Capital Financial Aid Office has reviewed your student's financial aid application and a financial aid offer has been processed.
- Any verification documents requested by Capital have been completed and submitted. Parents are eligible to borrow up to the total annual cost of attendance minus any financial aid the student is eligible to receive.
- You understand that if your Federal Direct PLUS Loan application is approved, and your PLUS Loan Promissory Note has been completed and signed, the proceeds will be disbursed to your student's account at Capital University.
APPLYING FOR A DIRECT PARENT PLUS LOAN
SUBMIT YOUR APPLICATION
Once you meet all of the conditions mentioned above, you can apply for a Direct Parent PLUS Loan. The parent borrower must login to the federal site at studentloans.gov to start the process.
Approval of your Federal Direct PLUS Loan
If your Federal Direct PLUS Loan is approved, the Department of Education will notify Capital University of this approval. This notification typically comes to the Financial Aid Office within three business days.
Sign Your Direct PLUS Promissory Note
You must sign a Federal Direct PLUS Promissory Note before your loan can be fully processed. You can sign your Promissory Note online after your Federal Direct PLUS Loan has been pre-approved. You must have your Parent FSA ID to sign the Promissory Note online.
If Your Direct Parent PLUS Loan is Denied
Parent borrowers are notified immediately if their Federal Direct PLUS Loan application is denied. This information is also shared with the Capital Financial Aid Office so we can assist you with other options.
As a result of a PLUS loan denial, students may be eligible to borrow up to $5,000 additional Federal Direct Unsubsidized Loan funds, depending on their grade level. If your student is interested in obtaining this additional loan assistance, you can indicate this on the PLUS application website once you learn of the credit decision. Your student should also contact Capital's Financial Aid Office.