As the fall semester draws to a close, families who still need money for college for end-of-semester expenses or for the upcoming spring semester may be able to get the help they need with a Federal PLUS Loan from NextStudent, a leading Phoenix-based education funding company. PLUS loans give parents of undergraduates a low-interest financing option that they can apply for throughout the school year (depending on the final deadline set by the school’s financial aid office). And PLUS financing is available even if your student doesn’t qualify for need-based grants or student loans.
PLUS Loan Overview
PLUS loans (Parent Loans for Undergraduate Students) are federal college loans that can help creditworthy parents meet up to 100% of their undergraduate child’s educational expenses. PLUS loans are non–need-based, so eligible parents won’t be disqualified for making too much money.
Features and Benefits
* No application fees
* Fixed interest rate
* Loan limits up to 100% of the cost of attendance
* Mid-year application: Apply even in the middle of the school year. (Contact your school’s financial aid office for their final deadline.)
* Non–need-based: Eligible parents can’t be disqualified for having too much money or assets.
* Co-signers allowed: If you’re a parent who doesn’t meet the PLUS credit requirements, you may apply with an eligible co-signer.
* No prepayment penalties: Pay off your PLUS loan early without incurring any additional charges.
* Forbearance and deferment benefits: If you’re experiencing financial difficulties, you may be able to temporarily postpone or reduce your PLUS loan payments without affecting your credit rating.
* Eligible for federal student loan consolidation
Rates, Fees and Terms
Rates
PLUS loans carry a low, fixed rate of 8.5%.
Fees
There’s no fee to apply for a NextStudent PLUS loan! Once you’re approved, your PLUS loan may be subject to a 3% origination fee and a 1% guarantee fee. These fees would be taken out of the proceeds of your PLUS loan.
Terms
Each year, you may borrow up to your child’s full cost of attendance less any other financial aid (such as student loans, scholarships, or work-study) your child has received. The cost of attendance is determined by the school—besides tuition and room and board, it includes a reasonable allowance for other education-related costs such as student fees, books, transportation, and living expenses.
The standard repayment term for a PLUS loan is 10 years. But you may be able to extend your repayment term with an extended repayment plan or by consolidating your PLUS loan(s).
Eligibility
Parents
PLUS loan borrowers must meet certain eligibility requirements:
* Parent or legal guardian of an eligible undergraduate student
* U.S. citizen or permanent resident
* Creditworthy
To be deemed “creditworthy,” you may not be in default on any federal college loans, and your credit report should be free of derogatory credit items (such as bankruptcies, foreclosures, tax liens, or collections) for the last five years.
Either parent (or legal guardian) may apply for a PLUS loan. A parent who doesn’t meet the PLUS credit requirements may apply with an eligible co-signer.
Students
To be considered an eligible undergraduate student, your child must also meet certain requirements:
* Enrolled at least half time and maintaining satisfactory academic progress, as determined by the school
* Younger than 24
* Single with no dependents
* Not a ward of the court, a military veteran, or in the military
* U.S. citizen or permanent resident
* Not in default on any federal student loans
NextStudent believes that getting an education is the best investment you can make, and we are dedicated to helping you pursue your education dreams by making college funding simple. Learn more about Student Loans, Private Student Loans and Student Loan Consolidation.
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