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Federal PLUS LOANS

Parent PLUS Loans are offered by the Department of Education (Dept.) for parents of dependent undergraduate students. Borrowers must be U.S. Citizens or eligible non-citizens. Approval is credit-based, and the maximum loan amount allowed is determined by subtracting all other aid awarded from the cost of education.

Requests should be submitted only after the student's aid award has been determined, and the health insurance decision has been made. Requests should be made before the August 10th Fall due date for Fall only or full-year loans, and before January 10th for Spring only loans.

Single-term loans are allowed, but parents typically borrow full-year loans for full-year students. Some parents may find that financing is needed for the Fall term, but are uncertain about Spring. In such cases, we recommend borrowing for the full year, and having us cancel the Spring portion if it is not needed, instead of borrowing two single-term loans. This way, financing is in place for Spring if needed, and can be easily cancelled if not needed.

Smith uses the online request method at StudentLoans.gov, which activates for use on July 1st. For more details, and information on how to apply for a PLUS loan, please review the information below.

Terms of the Loan

First Disbursed Interest Rate
July 1, 2014–June 30, 2015
7.21% (fixed)
July 1, 2015–June 30, 2016
6.84% (fixed)

Note: Interest begins to accrue on disbursed amounts upon disbursement.

First Disbursed Origination Fee
Through September 30, 2015
4.292%
Oct. 1, 2015 - Sept. 30, 2016
4.272%

Note: Origination fees are deducted from the requested loan amount, not added on top of the requested amount.

Example: You want $20,000 to pay to the account.

$20,000/.9571* = $20,896 = loan amount to request.

Example: You request $20,000.

$20,000 x .9571* = $19,142 = total credit to the account.

* This figure is based on a 4.292% loan fee.

How to Apply

1. Satisfy Prerequisites

Wait until the student's aid award has been determined. PLUS loans cannot be processed until this is complete. Even if you do not receive institutional aid, you must complete a FAFSA (Free Application for Federal Student Aid) in order to borrow a PLUS loan.

Because the required insurance decision affects the amount due and the borrowing limit, please complete the insurance decision process before applying for the PLUS loan. This must be completed prior to each year the student attends. Instructions on the health insurance process are sent to students through their Smith email accounts on or around July 1st.

2. Decide How Much to Borrow

During the loan request process, you must request either a specific whole dollar amount, or check the box requesting the maximum amount.

Keep in mind that the loan fee is deducted before pay-out. The current loan fee is 4.292%, which means that only 95.71% of your requested loan amount is whiat pays out to the student account.

If you want to net a specific amount, divide the desired net amount by .9571 and round down to determine the correct loan amount to request.

If you need assistance, contact us via email at loanhelp@smith.edu.

3. Request a PLUS Loan.

Sign in at www.studentloans.gov and make your request.

4. Complete a Master Promissory Note.

If you will be a first time borrower of this loan type for the named student, or if you previously borrowed this loan using an endorser, you must complete a PLUS Loan Master Promissory Note at www.studentloans.gov. If you have previously borrowed a PLUS Loan for the named student without an endorser, skip this step.

Process Overview for Approved Loans

Disbursement

Refunds

Repayment and Deferment

Denials

Questions?

Please submit any questions or concerns to loanhelp@smith.edu