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Effective as of the 2009-2010 academic year, Smith College will begin processing Federal Direct PLUS Loans for parents and graduate students via the William D. Ford Federal Direct Loan Program. The College has already been participating in this program for undergraduate federal student loans (Federal Direct/Ford Loans).
This single-lender system allows for a more streamlined process, however, please note that this office will still honor FFEL Program PLUS Loan applications (i.e., those applications that are through a third-party lender). Those that do wish to borrow under FFEL Program are responsible for researching and selecting lenders, as the terms may be different from that of the Federal Direct PLUS Loan Program.
Basic PLUS Loan Points:
* PLUS Loans, like all other educational loans, may not exceed the cost of education less all other aid.
* Credit worthiness is a factor in PLUS Loan application approval.
* Repayment begins no later than 60 days after initial disbursement of the loan unless you request to defer the repayment.
* The repayment period is ten years or less, depending on the amount.
* The mothly payment depends on the loan amount, but it may not be less than $50.
* Full-year PLUS loans are disbursed in equal installments over the two semesters.
* Interest rates are fixed.
* 2009-10 Direct PLUS rate: 7.9%
* 2009-10 FFEL PLUS rate: 8.5%
* Origination fees are deducted from the loan amount before disbursement.
* 2009-10 Direct PLUS Fee: 4.0% (less 1.5% that is added back as an on-time repayment incentive rebate)
* 2009-10 FFEL PLUS rate: Ask your lender.
Note regarding Direct PLUS Loan Amounts:
2.5% (combination fee and rebate) of the loan amount is deducted before it pays to an account. To account for this adjustment when you determine your loan amount, divide the amount that you want to pay to a tuition account by .975.
Example: You want $10,000 to pay to the account.
Divide $10,000 by .975 to get $10,256 (rounded up).
$10,256 is what the (gross) loan amount should be to net $10,000 in disbursement.
To apply for a Federal Direct PLUS Loan, the borrower must complete the Federal direct PLUS Loan Pre-application and Authorization forms and return them to the Student Financial Services. If approved, an electronic master promissory must be submitted online. If the PLUS loan is for a graduate student, online entrance counseling is required. Please click on the links below to access the necessary information sheets, forms, and external websites required for this loan.
Federal Direct PLUS Loan Borrowing Overview
Federal Direct PLUS Loan Fact Sheet
Federal Direct PLUS Loan Pre-Application & Authorization Forms
Federal Student Aid Master Promissory Note Site
Federal Student Aid Loan Servicing Site (Grad Student Entrance Counseling ONLY)
Direct PLUS Loan Rights and Responsibilities
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