SEARCH

 Direct PLUS Loans (Parent & Graduate)

Direct PLUS Loans are part of the federal Direct Loan Program. Unlike most other federal student loans, PLUS Loans are not awarded to students when they apply for aid. Graduate/professional students (Grad PLUS loan) and parents of undergraduates (PLUS Loan) apply separately for the PLUS (in addition to completing a FAFSA) if they need additional funds to cover college costs.

After applying and being approved for a Direct PLUS Loan, the award will appear on the student's financial aid Award Notice. Borrowers must complete the Direct Loan Program requirements listed on this page in order to receive loan funds. See the appropriate links for other details, including how to apply for a Direct PLUS Loan.

On this page

 

ABOUT THE PLUS LOAN

The Direct PLUS Loan is unsubsidized, so interest accrues while the student is enrolled at least half-time and during deferment periods. Eligibility is not based on financial need, and graduate students and parents of undergraduates may borrow up to the amount of the student’s Cost of Attendance, minus any other financial assistance a student receives.

The Direct PLUS Loan may be of particular interest to students and parents who: 

  • are not eligible for other types of financial aid
  • have unusual costs above the standard student expense budgets
  • have remaining financial need after other forms of financial aid have been awarded, or
  • wish to borrow all or part of their Expected Family Contribution

PLUS Loans offer advantages compared to private education loans, including the stability of federal funding, a fixed interest rate, and repayment and deferment options. See Eligibility, Loan Terms, and Requirements below and the Comparing Supplemental Loans page for details.

ELIGIBILITY, LOAN TERMS, AND REQUIREMENTS

Students (or their parents) must submit a Free Application for Federal Student Aid (FAFSA) when applying for a PLUS or Grad PLUS Loan. Borrowers must have an acceptable credit history or a loan endorser with an acceptable credit history. Families with adverse credit may sometimes borrow under PLUS if they can document extenuating circumstances.

Key information about PLUS:

  • Because credit reports are only valid for a limited time and we process PLUS Loan applications in July, we wait until early April to accept PLUS applications so that only one credit check is required.
  • We will assume that your application is for the Fall/Winter terms. If you want the loan for one term only, advise us as soon as possible. We begin sending PLUS applications to the federal processor in early July. Eligibility is determined when your application is processed in July.
  • Contact our office if you require a paper PLUS Loan application (this version is longer credit check results will be delayed until the application is processed).

More information about the terms of the Direct PLUS Loan is included in the table below:

 DIRECT PLUS LOAN
(for Parents of Dependent Undergraduates)

Eligibility Criteria Loan Terms Additional Information/Requirements

• Non-need-based

• Parent borrows on behalf of undergraduate student

• Student must be enrolled at least half-time in a degree program

• Borrower must be a U.S. citizen or eligible noncitizen

• Borrower cannot be 90 days or more delinquent on repayment of any debt (180 days on mortgage loan or medical bill payments) or the subject of a default, bankruptcy discharge, foreclosure, repossession, tax lien, wage garnishment, or write-off of a Title IV debt in the last 5 years

• 6.84% variable-fixed interest rate (effective July 1, 2015; Rates change each July 1)  

• 4.292% origination fee (for loans originated Oct. 1, 2014. For loans originated Oct. 1, 2015, the fee will be 4.272%. Fees change each fall)

• Parents may borrow up to the student’s Cost of Attendance minus other financial assistance

• Interest accrues immediately; may be paid periodically or capitalized 

• Principal and interest repayment begins 60 days after disbursement. (Parents may qualify for deferment while student is enrolled. Visit NSLDS.ed.gov to find your servicer)

• May be consolidated with other Direct Loans  

• Students must complete the Free Application for Federal Student Aid (FAFSA).

• First-time Direct Loan borrowers must complete an online Master Promissory Note

• More information from the U.S. Department of Education

 DIRECT GRADUATE PLUS LOAN
(for Graduate and Professional Students)

Eligibility Criteria Loan Terms Additional Information/Requirements

• Non-need-based

• The graduate student is the borrower

• Student must be enrolled at least half-time in a graduate-level program

• Borrower must be a U.S. citizen or eligible noncitizen

• Borrower cannot be 90 days or more delinquent on the repayment of any debt or the subject of a default determination, bankruptcy discharge, foreclosure, repossession, tax lien, wage garnishment, or write-off of a Title IV debt during the last five years

• 6.84% variable-fixed interest rate (effective July 1, 2015; Rates change each July 1)   

• 4.292% origination fee (for loans originated Oct. 1, 2014. For loans originated Oct. 1, 2015, the fee will be 4.272%. Fees change each fall)

• Students may borrow up to the cost of attendance minus other financial assistance

• Interest begins accruing immediately; may be paid periodically or capitalized

• Loan is deferred while you are enrolled at least half-time and for an additional six months after you are no longer enrolled at least half-time. Interest accrues during deferment; you may pay accrued interests or allow it to capitalize when deferment ends. Details at the U.S.Dept. of Education

• PLUS Loans may be consolidated with other Direct Loans

• Borrower must complete the Free Application for Federal Student Aid (FAFSA)

• Borrowers accepting PLUS Loan funds for the first time must complete an online Master Promissory Note and Direct Loan Entrance Counseling(Note: This is not the same as the Financial Awareness Counseling Tool on the same site.) See Completing Your Loan Requirements, below.

• Exit Counseling is required when students graduate or drop below half-time.

• More information from the U.S. Department of Education

 (return to top of page)

HOW TO APPLY: PARENTS OF UNDERGRADUATES

 In mid-April or later, visit StudentLoans.gov. (Do not use studentloans.com, which is a commercial website.)

 Sign in (under Manage My Direct Loan) using your U.S. Department of Education FSA ID (See illustration above.) If you need an FSA ID, visit fsaid.ed.gov.

 Select "Request PLUS Loan."

 Follow the steps to complete the application and credit check. In the School Name section, be sure to select University of Michigan-Ann Arbor.

 The results of your credit check will be available immediately. If your credit is approved, you will be given instructions for completing a PLUS Loan Master Promissory Note. If your credit is not approved, you will have the option to obtain an endorser, appeal the credit decision or not pursue the loan.

 If you and/or your student are eligible non-U.S. citizens, you must also submit a copy of your U.S. Citizenship and Immigration Services document to the Office of Financial Aid to verify your current citizenship status. Copy both sides of the document, write the student's name and UMID on the copies, and fax them to our office at (734) 647-3081 or email them to financial.aid@umich.edu.

(return to top of page)

HOW TO APPLY: GRADUATE AND PROFESSIONAL STUDENTS

 Complete a Free Application for Federal Student Aid (FAFSA), if you have not already done so.

 In mid-April or later, visit studentsoans.gov (Do not use studentloans.com, which is a commercial website.)

 Sign in (under Manage My Direct Loan) using your U.S. Department of Education Personal Identification Number FSA ID (See illustration above).  If you need an FSA ID, visit fsaid.ed.gov.

 Select "Request PLUS Loan."

 Follow the steps to complete the application and credit check. In the School Name section, be sure to select University of Michigan-Ann Arbor.

 The results of your credit check will be available immediately. If your credit is approved, you will be given instructions for completing a PLUS Loan Master Promissory Note, if you have not already completed one. If your credit is not approved, you will have the option to obtain an endorser, appeal the credit decision or not pursue the loan.

 If you are borrowing through the PLUS Program for the first time, you must also complete Direct Loan Entrance Counseling at StudentLoans.gov(Entrance Counseling is NOT the same as the Financial Awareness Counseling Tool.)

COMPLETING YOUR LOAN REQUIREMENTS

If you are a Direct PLUS Loan borrower, you will be required to complete three Direct Loan Program requirements: sign a master promissory note, complete entrance counseling, and complete exit counseling.

Master Promissory Notes

Parents and students borrowing for the first time through the Direct Loan Program must complete a Direct Loan Master Promissory Note (or MPN) to receive their loan funds. The MPN authorizes U-M to credit the Direct Loan funds to the U-M student's account. Once you complete the MPN, you will not have to complete another Direct Loan MPN for 10 years. If you have accepted other federal loans (e.g., Perkins, Health Professions, or Nursing Loans), you will need separate promissory notes for those loans. The Office of Financial Aid will notify you of how to complete them. Visit this page for details about completing your MPN.

If you prefer, you may complete a paper MPN, but there are more steps involved before approval and your loans could be delayed. To complete a paper MPN, sign in at studentloans.gov; select "Complete MPN" to complete the MPN electronically or "Print MPN" to print, complete and mail a paper MPN to our office..

Entrance and Exit Counseling

Entrance Counseling: If you are a graduate student PLUS borrower, you must complete Direct Loan Entrance Counseling on the U.S. Department of Education's StudentLoans.gov website under the "Complete Counseling" link. This interactive counseling session and quiz helps students develop budgets for managing educational expenses and also understand their loan responsibilities. You must complete the counseling before your loan funds can be disbursed to you.  (Note: Entrance Counseling is not the same as the Financial Awareness Counseling Tool on the same site. Taking a demo counseling session will not fulfill your requirement.) Parent PLUS borrowers are not required to complete entrance counseling.

Exit Counseling: This is required for Direct Loan student borrowers who are graduating or dropping below half-time enrollment. This counseling session helps borrowers understand their rights and responsibilities in repayment and helps them choose a repayment plan. You must use your Department of Education FSA ID to access this counseling session. To complete the Exit Counseling session, go to the StudentLoans.gov website. Click the "Complete Counseling" link and follow the link to "Exit Counseling" to begin.   (Note: Exit Counseling is not the same as the Financial Awareness Counseling Tool on the same site. Taking a demo counseling session will not fulfill your requirement.)

RECEIVING YOUR LOAN FUNDS

You must sign all of your loan documents and students must be enrolled at least half-time to receive your loan funds.  See Disbursement of Your Aid Funds for information about how your loan will be paid to you. Each time you borrow through the Direct Loan program, you will automatically receive your loan funds unless you decline them (see How to Accept, Decline, or Reduce Your Awards).

ADVERSE CREDIT HISTORY

Federal PLUS loans are credit based. If it is determined that you have an adverse credit history, you may still quality for a Direct PLUS Loan. Follow these instructions:

  • find an endorser with good credit (not the student for which the loan is being borrowed) or
  • document extenuating circumstances to the U.S. Department of Education Office of Federal Student Aid. Visit studentloans.gov and select "Parent Borrowers" where you will find a link to "Document Extenuating Circumstances." Review does not guarantee approval; Federal Student Aid will determine your eligibility based on information provided.

In both cases, the parent will need to complete online PLUS Counseling at studentloans.gov.

If a parent is unable to secure a PLUS loan for a dependent undergraduate, the student is eligible for additional unsubsidized loans to help with education costs. This increase is not available if any parent passes the credit check or an endorser is approved. The student should contact our office for assistance.

For more about adverse credit history, visit Federal Student Aid.

(return to top of page)
 

STUDENT EMPLOYMENT OFFICEUNIVERSITY OF MICHIGANWOLVERINE ACCESSPORTAL EN ESPAÑOL
SITE MAPDISCLAIMERFEDERAL SCHOOL CODE 002325CSS PROFILE CODE 1839© 2015 Regents University of Michigan
Office of Financial Aid * 2500 Student Activities Building, 515 E. Jefferson, Ann Arbor, MI 48109-1316 * Tel 734-763-6600 * Fax 734-647-3081 * financial.aid@umich.edu
Login