Graduate PLUS Loans

A PLUS Loan stands for Parents Loan for Undergraduate Students. Generally these loans are given to students enrolled in undergraduate programs. There are now Graduate PLUS Loans, these are very low interest rate federal loans that are subsidized by the United States Government. These PLUS loans can be used to help fray the cost of tuition and books. These loans are dependant on the student’s credit score and credit history. You may need a cosigner for these loans if your credit does not qualify.

The benefits of applying for these Graduate PLUS Loans are they are offered at a fixed interest rate of 8.5%. These loans do not require any sort of collateral and the interest payments may be tax deductible. Just like student loans, these loan payments can be deferred until after college. How much money you will receive will depend on several things such as if you are a part time or full time student and if you are receiving other financial aid and how much. For example, if your cost of attendance as they call it is $ 8,000 and you are already receiving $ 3,000 in financial aid from other loans or grants then the maximum you can be approved for is $ 5,000.

After you have been approved for these loans the lender will be sending you the loan through the school. Then once the loan has been applied to tuition, room and board and books, if there is anything left over you will be issued the rest in a check or cash. The money left over from the loans have to be used for educational items. As we mentioned earlier these loans will depend on credit history but you don’t need to have A Plus credit, but there should not be any delinquencies of more than 90 days. If your credit is not good enough then you may need a cosigner.

The interest rate on these loans is a fixed 8.5%. By knowing what your interest rate is you will know exactly how much money a month you will be responsible for. The interest rate starts from the date that the check is given and will continue until the loan is paid. You may want to try to start paying off that loan while you are still in school so you won’t be paying interest for years to come. You can fill the application out online, they will ask you the basic questions of name, date of birth, city, state etc. They want the name of the College you will be attending. Then you will need financial information too.

If at any time you wish to cancel the loan at any time you will have to notify the school in writing. Try to notify the school as soon as you can. Before money disburses and things become too complicated. These loans are put in place to help students who cannot afford an education. You want to be responsible and make sure that you can pay these loans back even though payments are not due to start until after you graduate.