The Parent PLUS Loan, a Federal Direct PLUS Loan, is an option for parents of undergraduate students to help pay for educational expenses. A parent who qualifies may receive a Parent PLUS Loan for the education costs of a dependent undergraduate student who meets the eligible student definition. You can find additional Parent PLUS Loan information at studentaid.gov.
Am I eligible?
As a parent of a dependent student, you may be eligible to borrow a Parent PLUS Loan as long as your student is a degree seeking student, enrolled for classes (at least half time) and meets financial aid satisfactory academic progress requirements.
Generally, you must have a good credit history to qualify. If your credit report indicates you are 90 days or more delinquent on any debt, are in default, have a bankruptcy, a foreclosure, a repossession, a tax lien, wage garnishment or a write-off of any Title IV federal financial aid during the last five years, you will not be eligible to borrow a Parent PLUS Loan unless you can obtain a credit worthy endorser.
ASU is not the lender of the Parent PLUS Loan, and does not approve or decline your eligibility. The federal government is the lender for all PLUS loans. Your credit worthiness is determined by the U.S. Department of Education. The U.S. Department of Education will not share or send your credit information to ASU. Questions about your ability to borrow be should be directed to the lender.
- An endorser is someone who has a good credit history and agrees to repay the Parent PLUS Loan if you are unable to do so.
- You must be a U.S. citizen, U.S. National or a permanent resident of the United States.
- You must be the biological parent or an adoptive mother or father of your student. A step-parent is also eligible if his/her income and assets were provided on the FAFSA. If you are a legal guardian or grandparent, you are not eligible to apply for a Parent PLUS Loan.
How much should I borrow?
- The amount of the Parent PLUS Loan you may borrow is determined by your student’s estimated cost of attendance less any other awarded financial aid.
- ASU awards the maximum amount that you may borrow, however, you may choose to accept an amount lower than the maximum. You do not have to accept any of the PLUS loan and we encourage you to apply for only what you feel is necessary given your family’s financial situation.
- The amount you accept should reflect the amount you wish to borrow for your student’s actual period of enrollment. If your student is enrolled for the entire academic year (fall and spring), then the approved loan amount will be disbursed half in the fall and half in the spring. If your student is attending only one term, the approved loan amount will disburse in that semester.
- Always keep in mind that a parent loan may need to be borrowed for each year of undergraduate study, so plan carefully as payments increase whenever a new loan is fully disbursed.
What Are the Interest Rates and Fees on a Parent PLUS Loan?
- The interest rate on Parent PLUS loans is fixed.
- The current interest rate is 6.31%.
- The interest rate is based on the 10 year treasury rate plus a fixed margin of 4.6%.
- Interest starts to accumulate when the first disbursement of the Parent PLUS Loan is made to the student’s account.
- There is a 4.276% loan origination fee on all Parent PLUS Loans. This fee will be deducted from each disbursement.
The Parent PLUS Loan process
Begin this process as early as possible to ensure coordination with tuition deadlines and timely disbursement of funds. See ASU's tuition deadlines calendar for details.
- To start the process of applying for a Parent PLUS Loan you and your parents must complete a FAFSA.
- After ASU receives your FAFSA and you have completed all the items under your Priority Tasks on My ASU, you may be offered a Parent PLUS Loan.
- If you are graduating in the fall, you must apply for graduation and notify Financial Aid and Scholarship Services in writing that you plan to graduate and will only need your loan for one semester. If we are not notified, your loan will be split over the full year.
If you already granted your parent guest access to accept a Parent PLUS loan, proceed to the Accept Your Loan step.
Grant your parent guest access to accept a Parent PLUS loan by adding a guest on My ASU in the My ASU Parent Guest Access Permissions section. Be sure to specify your new guest as a parent AND grant access to the "Manage Parent PLUS Loans" privilege. For instructions on granting parent guest access, click here.
Who Can Be Considered Your Parent?
Your parent must be your biological or adoptive mother or father. A stepparent is also eligible to borrow a PLUS Loan if his/her income and assets were required on the FAFSA. Legal guardians or grandparents (unless they are your adoptive parent) are not eligible to be considered as parents for the PLUS loan process.
If you already have your parent guest access to accept a Parent PLUS loan, proceed to the Accept Your Loan step.
- Log into My ASU, with your own parent ASURITE user ID, and click on the "Accept Parent PLUS Loan" link. If you have more than one student attending ASU, make sure you are viewing the correct student.
- Make sure all the information on the form is correct and there are no errors in any of the following fields. Incorrect information will lead to delays and could result in your loan application being denied.
- The spelling of your name
- Your Social Security Number
- Your date of birth
- Your citizenship status
- Enter the amount that you would like to accept, but not more than the amount offered by ASU and click the continue button. Processing of your loan will initiate a credit check through the U.S. Department of Education. ASU will receive notification of the approval or denial of your Parent PLUS Loan in two to three days. You will also receive approval or denial information in the mail from the U.S. Department of Education within two weeks. For all questions regarding your credit check, including credit criteria, please call 800-557-7394.
If Your PLUS Loan Application Is Denied
Federal PLUS Loans are subject to credit approval and may be denied. There are three available options to consider when a parent is credit denied a Parent PLUS Loan.
- Parents whose Parent PLUS loans are declined credit may be eligible to receive a Parent PLUS loan by securing a creditworthy endorser or may appeal the declined credit decision by documenting extenuating circumstances. Please contact the U.S. Department of Education PLUS Credit Appeal line at 800-557-7394.
NOTE: Effective March 29, 2015, federal regulations require any parent whose Parent PLUS loan was first denied credit and then consequently approved (either with a creditworthy endorser or by documenting extenuating circumstances to the satisfaction of the Department of Education) must complete PLUS Loan Counseling. You can complete PLUS Loan Counseling at studentloans.gov.
- If you are unable to find a creditworthy endorser or appeal the denial of your credit decision, your student may request an additional Federal Direct Unsubsidized Loan. Submit the Parent PLUS Loan Denial Funds Request form. Please be sure to include your ASU ID and signature. There are specific limits on the amount of additional unsubsidized loans that may be awarded. The maximum annual amounts are $4,000.00 for freshmen and sophomores and $5,000.00 for juniors and seniors.
- If one parent is credit denied for the Parent PLUS Loan and the other parent is interested in applying for it, please have your student contact Financial Aid and Scholarship Services.
- Complete Your Master Promissory Note.
- Parent Loan Default Resolution.
- Eligible Non-Citizenship Documentation
The Parent PLUS Loan Master Promissory Note is a multi-year feature of the Parent PLUS program. It allows you to receive future Parent PLUS Loans without completing another master promissory note as long as you remain eligible. However, if you were approved with an endorser you will need to do a new promissory note every year. You can complete your Parent PLUS Loan Master Promissory note at studentloans.gov. The parent whose name is on the Parent PLUS Loan application should complete the Parent PLUS Loan Master Promissory Note. If you are borrowing a Parent PLUS Loan for more than one student, you will need to complete a separate master promissory for each student’s PLUS loan.
If you receive a message that this is required, you will need to submit a Resolve Parent Default Status form with documentation that a default is cleared. if you are currently in default on a federal student or Parent PLUS Loan your student may submit a Parent PLUS Loan Denial Funds Request form If you are not in default or checked that you are in default in error, you must complete this form and check the box indicating you are not in default.
Submit the Parent PLUS Loan Citizenship Verification form along with the required documentation that a default is cleared to Financial Aid and Scholarship Services.
How will my Parent PLUS Loan be disbursed?
If your student is a fall/spring student, funds will be disbursed as a fall/spring loan (half in the fall and half in the spring). Your student is only eligible for a single disbursement loan if he/she is attending only one term.
What are my repayment options?
A Parent PLUS Loan is like any other loan. You, the parent, must repay the loan even if your financial circumstances become difficult or if your student does not complete their education. Parent PLUS Loan payments begin 60 days after the loan is fully disbursed. There are some situations where payment can be deferred. It's important to remember that if you able to secure a deferment on your Parent PLUS Loan, interest will continue to accrue during that time and any unpaid interest will be added to the principal balance of the loan. For information on deferment, please contact your loan servicer.
Currently there are seven repayment plans offered for Parent PLUS loans:
- Standard Repayment Plan – Under this plan, payments are a fixed amount of at least $50 per month and length is up to 10 years.
- Graduated Repayment Plan – Under this plan, payments are lower at first and then increase every two years. Length of this plan is up to 10 years.
- Extended Repayment Plan – Under this plan, payments may be fixed or graduated. Length of this plan is up to 25 years.
- Income-Sensitive Repayment Plan – Under this plan, your monthly payments are based on annual income and changes as your income changes. Length of this plan is up to 10 years.
- Income-Based Repayment Plan – Under this plan, you must have a partial financial hardship. Your monthly payments will be 15% of discretionary income. Your payments change as your income changes and length of this plan is up to 25 years.
- Pay As Your Earn Repayment Plan – Under this plan, you must be a new borrower on or after October 1, 2007 and must have received a disbursement of a Direct Loan on or after October 1, 2011. You must have a partial financial hardship. Your monthly payments will be 10% of discretionary income. Your payments change as your income changes and length of this plan is up to 20 years.
- Income-Contingent Repayment Plan – Under this plan your payments are calculated each year and based on your adjusted gross income, family size and the total amount of your Direct Loans. Your payments change as your income changes and length of this plan is up to 25 years.
Please contact your loan servicer to discuss which repayment plan works best for you.
A loan servicer is a company that takes care of the billing and other services on your Parent PLUS Loan. Your Parent PLUS Loan is assigned to a loan servicer by the U.S. Department of Education after the first disbursement is paid out. The loan servicer will contact you to discuss the repayment plans available.