Parent PLUS Loans are credit-based loans offered by the U.S. Department of Education. The amount of the loan is limited to cost of attendance minus all other aid. Smith's online PLUS Loan participation for 2013-14 begins June 1, 2013.
Terms of the Loan
|First Disbursed||Interest Rate|
|July 1, 2012–June 30, 2013|
|July 1, 2013–June 30, 2014|
|July 1, 2014-June 30, 2015||
Loan fee: The Department of Education deducts a loan origination fee on Parent PLUS Loans. For loans first disbursed on or after July 1, 2013 and before December 1, 2013 the origination fee is 4.204%. For loans first disbursed on or after December 1, 2013 the origination fee is 4.288%.
Loans for full-year students are treated as full-year loans, disbursing in two equal-term installments. If circumstances warrant a single-semester loan, please contact us at email@example.com before applying.
Loan proceeds pay directly to the student's tuition account.
Repayment of the loan begins 60 days after final disbursement. There is an option to defer while the student is enrolled; this is offered during the online loan request process.
How to Apply
1. Ascertain borrowing limit
If the intent is to cover the entire balance, first ascertain a borrowing limit (for assistance, contact us at firstname.lastname@example.org).
If the limit is less than what is needed, the student can reduce any work-study and/or officially accept the health insurance through Smith, which increase limit amounts. Other increases are handled on a case-by-case basis. Do not finalize requesting a PLUS loan until the limit adjustment is finalized.
2. Decide how much to borrow
In considering how much to borrow, keep in mind:
- For loans first disbursed on or after July 1, 2013 and before December 1, 2013 a 4.204 percent loan fee is deducted from the loan amount. To account for the fee, divide the desired net amount by .958 and round. For loans first disbursed on or after December 1, 2013 a 4.288 percent loan fee is deducted from the loan amount. To account for the fee, divide the desired net amount by .957 and round.
- Entering students who paid an enrollment deposit should factor in a $200 room deposit payment (the remainder is a general deposit)
- The amount that may be borrowed is limited to the cost of attendance (billed and not billed) minus all other aid (credited and not credited). Depending on the composition of aid, the borrowing limit may be less than or more than the billed amount due.
2. Apply for lender approval
If your aid award has been determined, apply for lender approval at www.studentloans.gov. Do not proceed if a loan limit issue is in progress.
3. Complete a Master Promissory Note
Go to www.studentloans.gov to complete a Master Promissory Note (MPN). Skip this step if the student has previously borrowed a Direct PLUS Loan, unless there is an endorser.
Smith will review the student's loan request for certification. Upon certification, the loan will be added to the student's aid package and originated with the Department of Education. If term changes are already posted, it will be coded to appear as a pending credit on the student's account, which can be viewed online.
The Department of Education will send a disclosure for the officially established loan directly to the student. This serves as notification that the loan was processed.
If a loan is fully approved and linked to a valid promissory note, the current term portion will pay out during the next disbursement process. Disbursement is typically run on a weekly basis provided there are no unforeseen problems, and not earlier than 10 days before the start of each term. Notification of disbursement is issued to the borrower by Student Financial Services via email.
Servicing of the loan
The Department of Education will assign the loan to one of its several servicers and notify the borrower of this activity and the servicer's name and contact information. We recommend registering with the servicer to monitor the student's loan account.
Please email us to let us know if you will pursue the loan, appeal the decision or will use an endorser.
To appeal, call Applicant Services, at (800) 557-7394. Endorsers must complete Endorser Addendums at www.studentloans.gov.
Overrides are possible if appealed to the lender's satisfaction or if a credit-worthy endorser signs onto the loan.
If not pursued, the denial allows the student to borrow an additional unsubidized Direct Loan, which is typically processed only upon request. If the loan will not be pursued, let us know if there will be an extended unsubsidized loan.
Please submit any questions or concerns to email@example.com.