Direct Grad PLUS Loans are unsubsidized loans for graduate/professional students. Grad PLUS loans help pay for education expenses up to the cost of attendance minus all other financial assistance. Interest is charged during all periods.
First, complete the Free Application for Federal Student Aid (FAFSA). After you have received an award notification and decided that a Grad PLUS loan is the best fit for you, apply through the U.S. Department of Education by completing the following steps:
The limit on a Grad PLUS Loan is the student's cost of attendance minus any other financial aid received. You apply for the academic year (fall/spring semesters or fall/winter/spring quarters). You apply for summer separately. The total origination fee is currently 4.248% of the amount borrowed. The interest rate on the loan is 7.6% for loans first disbursed after July 1, 2018, and before July 1, 2019. Origination fees and interest rates are reviewed and announced by the Department of Education each year. Go to Loan Disclosure Statement to view a sample. You will receive a statement specific to your loan before your loan is disbursed.
Federal regulations define credit eligibility for a Grad PLUS Loan as having no "adverse credit." This term normally means that the applicant has no debt repayment account that is 90 days or more delinquent, has not had any debt discharged in bankruptcy in the last 5 years, and has not been in default on any debt (no foreclosure, tax lien, repossession, wage garnishment, or write-off) in the last 5 years. An applicant will be determined to have an adverse credit history if the total combined outstanding balance of the debts, including debts in collection or charged off during the two years preceding the date of the credit report, is greater than $2,085.
The credit check for a Grad PLUS loan is valid for 180 days. Disbursement for Fall 2019 is scheduled for 10 days before the start of classes (the earliest date permissible by federal regulation.) You can apply for a PLUS or Grad PLUS loan for the 2019-2020 academic year no earlier than April 15, 2019. The studentloans.gov website will accept applications for the 2019-2020 academic year beginning April 15, 2019.
All first-time borrowers must complete the Master Promissory Note (MPN) and Grad PLUS borrowers must also complete entrance counseling at studentloans.gov. If the Department of Education approves your loan, the Department of Education will notify Baylor and will send the loan funds to the school shortly before the semester/quarter begins. The funds will first be applied to tuition, fees, room and board, and other school charges. If any loan funds remain, they will be disbursed based on your authorization on the application form. Grad PLUS Loans require the student be enrolled in at least half-time hours.
If you are denied a Grad PLUS, you have the option to either appeal the decision, add an endorser, or pursue a private alternative loan. You appeal the decision directly to the Department of Education and might qualify for a loan without passing the credit check if you can demonstrate that extenuating circumstances exist. And endorser is a relative or friend who is able to pass the credit check and agrees to endorse the loan. An endorser promises to repay the loan if you fail to do so.
Regular entrance counseling is required for all first-time Grad PLUS (graduate student) borrowers. Go to www.studentloans.gov and log in with your FSA ID to complete entrance counseling. Credit entrance counseling is required for certain PLUS (parent) borrowers. Parents who are approved for PLUS with an endorser or have an approved appealed credit decision will be required to complete credit entrance counseling. These borrowers will be notified if credit entrance counseling is required.
Exit counseling is required for student borrowers (Grad PLUS) but is not required for PLUS (parent) borrowers. Exit counseling is required when you drop below half-time hours, withdraw, graduate, or stop attending. You are required to complete exit counseling by logging in with your FSA ID at www.studentloans.gov.
There is no grace period for a Direct Grad PLUS Loan. You must separately request each deferment period. Generally, you will have from 10 to 25 years to repay your loan, depending on the repayment plan that you choose. The loan servicer will notify you of the date your first payment is due. If you do not choose a repayment plan, you will be placed on the standard plan, with fixed monthly payments for up to 10 years. You can change repayment plans at any time by contacting your loan servicer. More detailed information about all repayment plans is available at studentloans.gov.