Federal PLUS Loan

Who Is the Borrower?With some loans the parent borrows on behalf of the student. With other loans the student is the primary borrower, usually with a credit-worthy co-borrower who may or may not be the parent, depending on program restrictions.
Parents of eligible dependent undergraduate students.
Is this loan available for International Students?Some lenders will not allow international students to borrow, others will, but will often require a credit-worthy US citizen co-borrower. Check program restrictions.
No. Both the parent borrower and student must be U.S. citizens or permanent residents.
Interest Rates and FeesLoans may be offered with interest rates that are fixed for the life of the loan, or they may be variable and indexed to the prime or LIBOR rate. Fixed and variable rates may be tiered which means that the rate you are offered is determined by the strength of your credit. Most, but not all lenders charge no fees. Check program restrictions.
The interest rate for loans disbursed after June 30, 2023 and prior to July 1, 2024 is fixed at 8.05% for the life of the loan. The net loan amount disbursed is less than the amount borrowed because of an origination fee (see your disclosure statement for the specific amount) charged by the government.
Average Rate BU Borrowers got Last YearThe rate you are offered may be higher or lower than the average rate offered to BU borrowers for this loan in the past.
Credit CriteriaSome lenders evaluate the strength of your credit based on your credit score, others consider your credit history, others use a combination of both, and some include an assessment scale that is at least in part proprietary. In most cases, a credit-worthy co-borrower is encouraged.
Must pass PLUS Loan credit check. Parents unable to meet the PLUS credit criteria may be able to borrow with a creditworthy “endorser.” Borrowers with loans approved via appeal or endorser must complete an online counseling session. The endorser cannot be released from the repayment obligation before the loan is repaid in full.
Minimum and MaximumWhile the maximum amount a student could borrow in a credit-based educational loan is the annual cost of education (as determined by BU) minus any financial aid, including any Federal Direct Loan, some lenders impose minimum and maximum limits that are more restrictive.
Loans are approved from $100 up to the total annual cost of education minus any financial aid, including any Federal Direct Student Loan.
Repayment TermsRepayment terms are set by the lender and may include the length of the repayment term, minimum monthly payment amounts, and whether principal and/or interest payments are due while the student is enrolled. Most lenders have no prepayment penalties.
A 10-year standard monthly repayment of approximately $12.02 per $1,000 borrowed, with a $50 monthly minimum payment. Extended and graduated repayment plans are available. Principal and interest payments begin 60 days after the loan has been fully disbursed. No prepayment penalty.
Enrollment StatusMany but not all lenders require that the student be enrolled at least half time and be in a degree program to be approved for the loan. Check program restrictions.
Students must be enrolled in an undergraduate degree program for at least 6 credits each semester.
Deferment OptionsMany lenders offer borrowers the option to pay principal and interest while the student is enrolled or to pay interest only or make no payments while enrolled. Deferring repayment may increase the overall cost of borrowing. Check program restrictions.
Can defer payments until 6 months after student ceases to be enrolled at least half time. During deferment period interest can be paid monthly, quarterly or capitalized quarterly.
Can Loan be Sold?Some lenders retain ownership of the loans they originate while others bundle and sell their loans to a third party. Check each lender’s stated practice if this is a determining factor for you.
The loan will be held by the U.S. Department of Education for the life of the loan.
Other Borrower BenefitsSome lenders offer benefits such as interest rate reductions to borrowers who, for example have a prior customer relationship with the lender, agree to make payments electronically, graduate with good grades. Check borrower benefits offered by each lender you are considering.
Eligible for loan consolidation under Federal Direct Consolidation Loan Program.
Lender Website and More InformationMore detailed information about loan products is available on each lenders website or by contacting the customer service department of the lender.
Get more information at: http://studentaid.gov
How to ApplyMost loans are applied for electronically via the lender’s website.
To apply, go to: Five Steps to Applying for a Federal PLUS Loan at Boston University.
Contact BU Financial Assistance: finaid@bu.edu or 617-353-2965.