Frequently asked questions regarding PLUS loans.
Q: How do my parents apply for a loan?
Completing the Free Application for Federal Student Aid is the method for making application for all aid programs, including the Parent Loan. Eligibility for a Direct Parent (PLUS) will be determined after UNT Dallas receives information from the Federal Central Processor and the Department of Education performs a credit history check. Borrowers will be notified if additional action is necessary.
Q: I borrowed a PLUS loan at UNT Dallas last year. What do I have to do this year to get another PLUS loan?
Complete the Free Application for Federal Student Aid. Eligibility for a Federal Direct PLUS award will be determined once UNT Dallas receives information from the Federal Central Processor. A Direct PLUS loan award can be ‘Accepted’ via myUNT.
Q: What if my parent is not eligible for federal Direct PLUS loan?
The Department of Education will run a credit history check to determine eligibility for a Direct PLUS loan. The department will provide additional information (“Endorser Addendum”) to parents about other options if there is adverse credit history.
Q: What is a Federal Direct PLUS for Graduate Student Loan?
The Deficit Reduction Act of 2005 modified the Federal Direct PLUS program (formerly offering loans only to parents), which now allows graduate students to borrow PLUS loans. Students must request Student Financial Aid and Scholarships staff to review their eligibility for a Graduate Professional Federal Direct PLUS loan.
Q: Are there any loan fees?
In addition to loan interest, there are fees associated with borrowing a Federal Direct PLUS Loan. The U.S. Department of Education charges a 4% gross fee, and then gives borrowers an up-front rebate of 1.5%. This means that a net fee of 2.5% of the total amount borrowed each year will be charged. This fee is deducted from the loan by the Department of Education before the proceeds are credited to a student's account. IMPORTANT NOTE ABOUT THE UP-FRONT REBATE: The up-front rebate reduces the fee borrowers pay at the point of loan origination. However, if the first 12 monthly payments are not made consecutively and on time, the U.S. Department of Education will add the 1.5% rebate back to your loan balance.
Q: What about repayment?
Repayment of the Federal Direct PLUS Loan principal and interest begins 60 days after the final disbursement for the loan period. Deferments are available for parents who wish to postpone repayment until after the dependent student has graduated or withdrawn.
Q: Where can I get additional information?
Visit http://www.direct.ed.gov/parent.html for more information.
