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Federal Direct Parent PLUS Loan


Parents may be eligible to borrow a Federal Direct Parent PLUS Loan to help defer the education expenses for their dependent undergraduate students.


Eligibility


The student:

  1. Must be fully admitted as a degree-seeking student at ISU.
  2. Must be enrolled at least half–time when the loan is expected to be disbursed.
  3. Must maintain Satisfactory Academic Progress standards.
  4. Must be a U.S. Citizen or eligible non-citizen.
  5. Must not be in default on an educational loan or owe an overpayment on a federal education grant, or other federal debt, or has made satisfactory arrangements to repay that debt.

The parent borrower:

  1. Must be a natural or adoptive parent of the student or a step-parent whose income is reported on the student's completed FAFSA application.
     
  2. Must not be in default on an educational loan or owe an overpayment on a federal education grant, or other federal debt, or has made satisfactory arrangements to repay that debt.
     
  3. Must be creditworthy.

How to Apply

  1. File the Free Application for Federal Student Aid (FAFSA).
     
  2. Complete the Federal Direct Parent PLUS Loan Request Form. This form must be completed and signed by the parent (borrower) in whose name the loan application will be made.
     
  3. First-time borrowers must complete the Master Promissory Note and Entrance Counseling for a Federal Direct Parent PLUS Loan.
     
  4. Receive Approval/Denial. The parent (borrower) will receive notification directly from the U.S. Department of Education on approval/denial. Individuals denied a Federal Direct Parent PLUS Loan have the following options:
    • The parent may be approved with an endorser (co-signer) who agrees to repay the Federal Direct Parent PLUS Loan in the event the parent does not. The endorser may not be the student on whose behalf a parent obtains a Federal Direct Parent PLUS Loan.
       
    • The student may apply for an Unsubsidized Direct Loan based on the student's eligibility. The student will need to submit an Additional Unsubsidized Loan Request Form along with proof of denial of the Federal Direct Parent PLUS Loan.

Amounts

A parent may borrow the student's cost of attendance minus any financial aid (for example, grants, scholarships, work-study, federal student loans) the student is already receiving for the school year.


Interest Rates and Fees

The interest rate is fixed at 6.41%. The loan fee is 4% for loans originated between July 1, 2013 and November 30, 2013. For loans in which the first disbursement is after Dec 1, 2013, the origination fee is 4.288%. Payment may be deferred if the student is enrolled half-time. Contact Direct Loans to request deferment.


Disbursement of Funds

Loan funds are sent directly to Indiana State University from the U.S. Department of Education and credited directly to the student's account. If the borrower applies for a full academic year loan, half of the amount applied for is disbursed at the start of the fall semester and the other half at the start of the spring semester. Funds will first cover any charges on the student's account. Any excess funds will be refunded to the parent.


Repayment

To find out more about repayment options before receiving a Direct Loan, borrowers may contact the Federal Student Aid Information Center at 1-800-4-FED-AID (1-800-433-3243).

In addition, visit repayment.

Contact

Student Financial Aid
220 North 7th Street
150 Tirey Hall
Indiana State University
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