Federal Plus Loans for Graduate Students
PLUS Loans
This federal loan is for graduate students and is not based on financial need. This loan can help the student cover any educational expenses not covered by other financial assistance.
Who Is Eligible
Graduate students who qualify for federal financial aid, are enrolled at least half-time, and have educational expenses not covered by other financial assistance, such as the Stafford Loan. The lender will perform a credit check on the student applicant to make sure that the student qualifies based on the lender's criteria for credit worthiness.
Borrowing Limits
A student may borrow up to the difference between the total annual cost of education, including educational fees, books, living and travel expenses, and any financial aid for which the student is eligible. The student must receive his or her maximum Stafford eligibility for the year before taking advantage of the graduate PLUS Loan. Some students may find that they do not qualify for the graduate PLUS because their total cost of attendance does not exceed the $18,500 Stafford maximum. Please contact our office if you have questions about the amount for which you might qualify.
Loan Terms
Like the Unsubsidized Stafford, the PLUS accrues interest from the day the loan is made until it is paid in full. The PLUS can be deferred while the student is enrolled at least half-time, but, unlike the Stafford Loans,it has no grace period, so the first payment would be due 60 days after the deferment expires. It is subject to a fixed 8.5% interest rate, but students who borrow from a MOHELA lender are eligible for a 6.9% interest rate during periods of in school deferment (no payments are due during the deferment period, but interest would accrue at the lower rate).
Graduate PLUS or Alternative Loan?
Unlike the alternative loans, the Graduate PLUS can be consolidated with the student's Stafford Loans after graduation, which would allow the student to keep all loans with one holder and has the potential of greatly reducing the student's monthly loan payment. Since the various alternative loan programs have different interest rates and loan terms, it's good to compare those terms when choosing a loan. Some things to consider are the length of the repayment period, the interest rate formula and frequency of interest capitalization (does interest get added to principal quarterly, annually, at start of repayment?), origination fees (3% for Graduate PLUS)and eligibility for forbearances and deferments.
Application Process
Students can contact the lender directly for a credit preapproval. Since this is a new program, many lenders are still in the process of adapting their loan procedures and web sites to accomodate new loans. In order to certify your approved loan amount, UM-St. Louis must receive your completed FAFSA. We will publish further instructions and links on this page when they become available.
 |
 |
 |
|
 |
 |