The Federal Direct Parent PLUS is a federal loan that a parent with a good credit history may borrow to help pay the educational expenses of a dependent undergraduate student enrolled at least half-time.
A parent may borrow up to the total of the Estimated Cost of Attendance, less all other financial aid received by the student. When completing a Parent PLUS loan application, parents are given the option of which semester(s) to apply to receive the loan. Parents who select a single semester (such as the Fall semester only) should be aware that when determining the maximum allowable loan amount only the Cost of Attendance applicable to that period of enrollment can be considered. Additionally, if a parent requests a Parent PLUS loan for the Fall semester but later wishes to have the loan applied to the Spring semester as well it is necessary to complete a new Parent PLUS loan application for the Spring semester. When ever possible, if the student will be attending the entire academic year, it is advised to apply for the Parent PLUS loan for the entire academic year. The 2015-16 Estimated Cost of Attendance for an undergraduate Illinois resident can be calculated by using the NIU Planning & Cost Estimator available through the Office of the Bursar. There is no cumulative limit to the amount of PLUS loans that can be taken out over the course of an undergraduate student’s career. Filing a FAFSA is required to receive a PLUS loan. The interest rate is fixed for loans disbursed between July 1, 2013 and June 30, 2014 at 6.41% and is charged on the loan from the time the loan funds are disbursed until it is paid in full. The interest rate for loans received between July 1, 2014 and June 30, 2015 is 7.21%. The interest rate for loans received between July 1, 2015 and June 30, 2016 is 6.84%. The interest rate for loans received between July 1, 2016 and June 30, 2017 is 6.31%.
For Direct Parent PLUS loans the origination fee for loans first disbursed after October 1, 2014 have an origination fee of 4.292%. The origination fee for loans first disbursed after October 1, 2015 have an origination fee of 4.272%. The origination fee for loans disbursed after October 1, 2016 have an origination fee of 4.276%. The origination fee is deducted from PLUS Loans. For example, a PLUS Loan in the amount of $1000 disbursed after October 1, 2015 will result in a net disbursement of $957.
After reviewing the information below, if you have any further questions you can contact Direct Loans Borrower Customer Service at 800-557-7394.
Eligible Parent PLUS applicants must be either:
In addition, the parent borrower must be either a U.S. citizen or an eligible non-citizen, and must not be in default or owe a refund to any financial aid program. The student must be enrolled at least half-time (6 hours in the Fall or Spring, or 3 hours in the Summer).
The parent must submit to a credit check by the United States Department of Education to be eligible for a Federal Direct Parent PLUS Loan. You authorize the credit check when you sign the Federal Direct Parent PLUS Loan Request Form. To be approved the parent must have a satisfactory credit history. However, income-to-debt ratio is not considered.
With convenience for parent applicants in mind, NIU has recently streamlined the Parent PLUS application process. PLUS Loans are now directly applied for on the StudentLoans.gov website. A Federal Student Aid ID (FSAID) is required for the parent to apply for the PLUS Loan, as well as to sign a Master Promissory Note. If the parent in question has not yet created a FSAID, this can quickly and easily be accomplished at the Federal Student Aid ID site. For a complete step-by-step walk-through of the application process please use our Tutorial: Completing a Direct Parent PLUS Loan.
The Direct PLUS Loan request consists of four sections:
The parent logs in to www.studentloans.gov with their PIN and provides basic demographic information about both the student and themselves, and submits to a credit check. They also indicate the amount they wish to borrow. A specific amount can be requested, or the borrower can ask for the maximum amount they are eligible to receive. This maximum amount is determined by the school, and as mentioned above is equal to the total of the Estimated Cost of Attendance, less all other financial aid received by the student. If no amount is provided (specific or maximum) the parent will be contacted by a Financial Aid representative for this information.
On the School and Loan Information section, applicants are asked to specify a Loan Period. If the student in question plans to enroll for both the Fall and Spring semester, then the full academic-year period (Fall and Spring) must be selected. The Fall-only period should only be selected if the student is set to graduate after the Fall term. Spring-only period should only be selected for students who will not be attending in the Fall.
If the parent has been approved, the final step will be to sign a Master Promissory Note, which is available on the same website as the PLUS Application. Please ensure that the Parent PLUS Master Promissory Note is the one that is completed, as multiple MPNs are available on the site.
If a Federal Direct Parent PLUS Loan Application is denied, it may be possible for the student to borrow an additional amount of the Unsubsidized Direct Loan in their own name. Freshman and sophomore students, are eligible to receive up to $4,000 additional unsubsidized loan, while juniors and seniors are eligible up to $5,000 additional unsubsidized loan. If a parent chooses the option of "Not Pursue PLUS Loan" or "Undecided" on the PLUS Application, the additional unsubsidized loan eligibility will automatically be offered to the student. If a parent chooses the option of "Appeal Decision" or Pursue Endorser", the information about these processes will be provided from and should be submitted back to Direct Loan Servicing. Options for when a PLUS is denied are included on the application. The SFAO will proceed based on the choice made on the application. If a change to the originally selected option is necessary, the student should contact the SFAO for more information.
If your financial aid does not cover all of your educational or living expenses, PLUS Loans are not necessarily your only option. Private Student Loans from a number of national lenders are available to borrowers with good credit. Information about these alternative loans can be found on our site.
NIU also offers a payment plan, called the Huskie Installment Plan (HIP). This program may prove beneficial to those who plan to pay some or all of their charges for a given semester out-of-pocket. Information about HIP can be found on the Bursar Office website.
Loans are disbursed to the Bursar account after the add/drop period is closed. If the Federal Direct Parent PLUS disbursement generates a refund after University charges are paid, the refunded amount will go to the parent unless the parent borrower indicates on the PLUS application that they authorize the refund to be sent to the student.
If the disbursement generates a parent/guardian refund, the parent borrower has the option of signing up for direct deposit. Direct deposit offers a timely, reliable and safe way to deliver your refund to your checking or savings account. Complete the Direct Deposit Form (pdf) and return it to the Bursar Office. For more information on refunds, please see the Bursar Office website.
Repayment begins within 60 days of the final loan disbursement during the academic year. Principal and interest payments may be deferred if the borrower meets deferment requirements. An in-school deferment may be available for a borrower whose student is enrolled at least half-time in a degree-seeking program, but is not automatic. To receive repayment information including available forbearance and deferment options please contact your loan servicer. Contact information is available at Federal Student Aid. If you do not know who your servicer is, please visit the National Student Loan Data System (NSLDS).
Typically, the length of repayment will be between 10 and 25 years, depending on the amount owed and which repayment plan is selected by the parent.