Federal Direct PLUS Loan
The Federal Direct PLUS Loan
is a federal loan program where parents of dependent undergraduate
students may borrow directly from the Federal Government instead of from
a bank or other lending institution. A Federal Direct PLUS loan is an
unsubsidized loan that is charged interest during all periods. A parent
may borrow up to the cost of attendance minus all other financial
assistance.
Parent
eligibility requirements for a Direct PLUS Loan
You must be
the student's biological or adoptive parent or the student's stepparent,
if the biological or adoptive parent has remarried at the time of
application. Your child must be a dependent student who is enrolled at
least half-time at a school that participates in the Direct Loan
Program.
For
financial aid purposes, a student is considered "dependent" if he or she
is under 24, unmarried, and has no legal dependents at the time the Free
Application for Federal Student Aid is submitted.
Parent PLUS
loan borrowers cannot have an adverse credit history (a credit check
will be done). In addition, parents and their dependent child must be
U.S. citizens or eligible noncitizens, must not be in default on any
federal education loans or owe an overpayment on a federal education
grant, and must meet other general eligibility requirements for the
Federal Student Aid programs.
You can
find more information about these requirements in Funding Education
Beyond High School: The Guide to Federal Student Aid available at:
www.studentaid.ed.gov
Applying for a PLUS Loan and the Electronic Master Promissory Note (eMPN)
To take out
a Direct PLUS Loan, you must complete a PLUS Loan Request Form as well
as a master promissory note (MPN). The MPN is a legal document in which
you promise to repay your loan(s) and any accrued interest and fees to
the Department. It also explains the terms and conditions of your loan(s).
You can now complete and
sign your MPN electronically on the Internet. The electronic MPN (eMPN)
may be signed at
https://dlenote.ed.gov/empn/index.jsp
»
The eMPN will now be a multi-year document. It will be valid for up to
10 years at San Diego City College and you will not have to complete and
sign a new eMPN every year.
»
You can sign your eMPN at any time even before you submit your PLUS Loan
Request Form to our office
»
If you are borrowing
Direct PLUS Loans for more than one student, you'll need to complete a
separate MPN for each one. To complete an MPN online, you will be
required to use your Department of Education-issued PIN (not your
child's). If you do not have a PIN, you may request one from the
official pin website at
www.pin.ed.gov
»
Once you sign the eMPN, the U.S. Department of Education will update
their database and send an acknowledgement to our school. If you
request a paper MPN, the U.S. Department of Education will print and
send you a copy of your MPN
»
You'll receive a
disclosure statement that gives you specific information about any loan
that the school plans to disburse under your MPN, including the loan
amount and loan fees, and the expected loan disbursement dates and
amounts.
You can
download and print the Direct PLUS Loan Request Form by clicking on the
following link:
Direct
PLUS Loan Request Form
Interest Rates
»
The interest rate for
Direct PLUS Loans is a fixed rate of 7.9%. Interest is charged on Direct
PLUS Loans during all periods, beginning on the date of your loan's
first disbursement.
»
The interest rate is
set each school year on July 1st. To see the current
interest rates, click here for the
Direct Loans Interest Rates for 09-10
How a
loan is disbursed (paid out)
»
Generally, your loan will
be paid out in two disbursements to you, for example, at the beginning
of each semester of the academic year.
»
Checks will be mailed
directly to the parent after the eMPN is signed. Parents must begin
repayment within 60 days of receiving full disbursement of the loan.
Using
the loan for education expenses
You may use
the loan money you receive only to pay for your child's education
expenses at the school that is giving you the loan. Education expenses
include school charges such as tuition, room and board, fees, and
indirect expenses such as books, supplies, equipment, dependent child
care expenses, transportation, and rental or purchase of a personal
computer.
Important
Deadlines
November 30, 2009 -
Last day to submit your loan request for the Fall 2009 semester only
December 19, 2009 -
Last day of the Fall 2009 semester
·May
3, 2010 - Last day to submit your loan request for the 2009-2010
academic year (Fall 2009 & Spring 2010 or Spring 2010 semester only)
May 23, 2010 - Last
day of Spring 2010 semester
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