The PLUS loan is designed for parents of dependent, undergraduate students. Parents can borrow up to the full cost of their child’s education, less any financial aid that the student has received. A credit check is required for the government-guaranteed PLUS Loan; however, eligibility is not based on financial need. Funds can be used for unmet financial needs or to cover your family’s Expected Family Contribution (EFC). Be sure to check with your school; some private colleges and universities do not permit families to use the PLUS Loan as a means to pay your EFC.
PLUS Loan Snapshot
Less costly than many other options; variable interest rates are adjusted annually. The current rate is 6.90%.
Available to cover the total cost of education, minus any other financial aid awarded to the student.
Available with minimal credit requirements.
Flexible, with deferment and forbearance provisions that allow you to postpone payments under certain circumstances.
Tax deductible, depending on your personal situation (consult your tax advisor for more information).
How Much Can You Afford to Borrow?
Before signing up for a PLUS loan, consider how much you can afford to repay on a monthly basis. Use this loan payment calculator to estimate payments based on how much you borrow.