Federal Direct Parent Loan for Undergraduate Students (PLUS)

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The Direct PLUS Loan program allows parents to borrow funds on behalf of their dependent undergraduate student. Direct PLUS Loans are taken out in the parent's name, not the student's, and are based on the credit of the parent borrower. The parent borrower is responsible for repaying the loan. The parent may borrow an amount up to the cost of attendance minus other financial aid.

Direct PLUS Loan funds are disbursed directly to the student's UMD account to pay toward tuition, fees, housing, and bookstore charges. If funds remain after this account is paid in full, any surplus funds will be sent to the parent borrower, unless the parent designates that the student should be the recipient. Interest begins to accumulate on the date of the first loan disbursement.

To be eligible for a Direct PLUS Loan, you must:

• Be enrolled in a degree-seeking program through one of the following collegiate units at UMD:
  • Swenson College of Science and Engineering (SCSE)
  • College of Liberal Arts (CLA)
  • College of Education and Human Service Professions (CEHSP)
  • Labovitz School of Business and Economics (LSBE)
  • School of Fine Arts (SFA)
• Have a FAFSA on file for the current academic year.
• Be enrolled at least half-time.
• Be meeting all Satisfactory Academic Progress (SAP) standards.
• Meet all of the General Eligibility Requirements for financial aid recipients.

PLUS Loan Interest Rates

Direct PLUS Loans that are taken out on or after July 1, 2006, will have a fixed interest rate of 7.90%.

Direct PLUS Loans that were taken out prior to July 1, 2006 have a variable rate structure. Interest rates on these loans are adjusted annually on July 1, and will not exceed 9%. An origination fee equal to 2.5% of the loan amount is deducted from the loan before it is disbursed.

Repayment of the Direct PLUS Loan begins after the loan is fully disbursed, with the first payment due within 60 days after the final loan disbursement. The parent borrower will receive statements from Direct Loans indicating the amount that is due.

If you have accepted a Direct PLUS Loan, your parent borrower will need to complete a PLUS Master Promissory Note (MPN) and a PLUS Active Confirmation Form before the loan funds will be paid to your account.

Note: For more information on deferments and forbearance, see Funding Education Beyond High School: The Guide to Federal Student Aid | 2010-11; U.S. Department of Education, Federal Student Aid.