Paying for College
PLUS Loans

For parent borrowers, the FFELP offers the Federal PLUS Loan. PLUS Loans are given to parents with good credit histories who need to borrow to pay for the education expenses of each child who is a dependent undergraduate student enrolled at least half time.

Are there any borrowing requirements my parents have to meet?

Yes. To be eligible to receive a PLUS Loan, your parents generally will be required to pass a credit check. If they don't pass the credit check, they might still be able to receive a loan if someone, such as a relative or friend who is able to pass the credit check, agrees to co-sign the loan, promising to repay it if your parents should fail to do so. Your parents might also qualify for a loan even if they don't pass the credit check if they can demonstrate that extenuating circumstances exist. You and your parents must also meet other general eligibility requirements for federal student financial aid.

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How do my parents apply for a PLUS Loan?

The procedure is the same as for the Stafford Loan, except that your financial need does not have to be evaluated. Therefore, you do not need to file a FAFSA, unless your school requires it.

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When should my parents apply for a PLUS Loan?

Your parents should apply as early as possible, after you have received your financial aid notification from the school.

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How will my parents be paid?

The lender will send the loan proceeds to your school in at least two payments. Payments will be sent either by electronic funds transfer or by check made co-payable to your school and your parents. No one payment may exceed half of the loan amount.

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How much can my parents borrow?

The yearly limit on a PLUS Loan is equal to your cost of attendance minus any other financial aid for which you are eligible. For example, if your cost of attendance is $6,000 and you're eligible for $4,000 in other financial aid, your parents could borrow up to $2,000.

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Is there a charge for a PLUS Loan?

Yes. You will be charged from 3 to 4 percent of the loan amount. This fee is deducted proportionally from each disbursement of the loan. The lender pays 3 percent of the fee to the federal government and 1 percent to the guarantor of your loan. OSAC is currently not charging the 1% fee. The lender may also charge late fees and collection costs if you do not make payments when they are due.

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When do my parents begin repaying a PLUS Loan?

Generally, repayment begins within 60 days after the final loan disbursement. There is no grace period for these loans. Interest begins to accumulate at the time the first disbursement is made, and your parents will begin repaying both principal and interest while you're in school.

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Is it ever possible to postpone repayment of a PLUS Loan?

Yes. Under certain circumstances, your parents can receive a deferment or forbearance on their loan. During a deferment, no payments are required; during forbearance, payments are either postponed or reduced.

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Can a PLUS Loan be discharged (canceled)?

Yes, under certain circumstances. A discharge releases your parents from all obligation to repay the loan.

For more information about discharge or repayment assistance, PLUS Loan borrowers should contact the lenders or agencies that hold their loans.

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Oregon Student Assistance Commission
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