Federal Student Loans: GradPlus Loan

• the use of the funds being applied to the total cost of a college education less any aid already received;
   
• the borrower's eligibility is largely dependent on the credit history;
   
• repayment of the loan begins on the date of the last disbursement;
   
• loan carries a fixed interest rate of 8.5% if received thru the FFEL program and 7.9 % if received thru the Direct Loan program;
   
• applicants are required to complete the Free Application for Federal Student Aid (FAFSA) and must have already applied for the annual loan amounts under the need based Federal Subsidized and Unsubsidized Stafford Loan Program.

Some other features of this federal student loan for graduate and professional students include:

• Graduate PLUS loans require no collateral
   
• The interest on this loan may may be tax deductible
   
• Graduate PLUS loans can be deferred, while you are in school

The annual limit for a Graduate PLUS Loan is equal to the cost of attendance (as determined by the school), minus any other financial aid received. For example, if your attendance cost is $9,000 and you receive $4,000 in other financial aid, you could borrow up to, but no more than, $5,000. Once approved, GradPlus funds are sent to the school for disbursement (in at least two installments). In some instances, you may need to endorse the check beforehand. Funds are applied to: school tuition, fees, room and board, and other school charges. If any funds are left over, you will receive a refund, unless you authorize the amount to remain in your school account for future education expenses.

In order to qualify for a Graduate PLUS Loan, you should not have an adverse credit history. An adverse credit history is defined as being 90 days or more delinquent on any debt, or having a credit report which indicates defaults, discharges, foreclosures, repossessions, tax liens, wage garnishments or write-off of a Title IV debt within the last five years. In certain instances, you may need a co-signer if the amount of your credit is not sufficient enough to make a decision.

If, for any reason, you want to cancel a GradPlus loan after being approved and signing the the promissory note, you may do so without penalty. When your school notifies you that the loan has been received (within 30 days), you may cancel all or a portion of the loan by informing them within 14 days thereafter. If you receive the funds by check mailed to your address, simply return the check without endorsement.

You can apply for the Federal Student Loans for Graduate Students Graduate PLUS Loan by first completing the:

• FAFSA Student application
   
• Federal Direct PLUS Loan Application and Master Promissory Note (PLUS MPN)

 

Other Resources to Explore

• Federal Student Loan Consolidation. If you receive a GradPlus loan, consider consolidating your loan to lower your monthly payment. Learn more about loan consolidation.
   

• If you do not qualify for this Federal student loan, consider applying for a Private Student Loan to finance your education. Also, don't forget to continue searching for Scholarships and Student Grants. This should be a continuous process - you never know what may turn up.

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