logo.png

Parent Loan For Undergraduate Students (PLUS)

Financial Aid Services offers Parent Loans for Undergraduate Students (PLUS) through the Federal Direct Lending Program, whereby federal funds are borrowed directly from the Department of education. Funds are available to parents of dependent, undergraduate students that are matriculated in a degree program and enrolled in at least six credits. Parents of dependent students may borrow up to the cost of attendance minus any other aid through this credit-based loan program per academic year. Only one parent of a student can borrow through this loan program (per application).

Interest Rate

Fixed at 7.9% for loans disbursed on or after July 1, 2008. Interest begins to accrue on the first day of the first disbursement.

Choose When to Pay Back

1. Begins within 60 days after the last disbursement of the loan for the academic year; OR

2. Parents may choose to defer payments until 6 mos. after student graduates or falls below 6 credits. Parent borrowers may choose to pay interest monthly, quarterly or choose to have interest capitalized.

How to Apply

Dependent students must file the Free Application for Federal Student Aid (FAFSA) to receive a financial aid offer, which will include PLUS eligibility.  Students are directed to go login to the BU Brain to view their parent’s eligibility for a PLUS loan.

Note: Parents may borrow any amount up to the cost of attendance minus any other accepted financial aid or resources.

Step 1 - Determine how much to borrow
Using the student's financial aid award offer and the anticipated charges associated with the 2008-09 academic year, determine how much is needed to help fund the cost of a student’s tuition bill and other expenses. The Parent PLUS Loan has a loan origination fee of 4%. The Department of Education provides an upfront repayment rebate of 1.5%. Therefore, 97.5% of the gross loan will actually disburse.

Step 2 - Apply for a PLUS
Complete and submit the Federal Direct Parent PLUS Loan Application* to Financial Aid Services, PO Box 6000, Binghamton, NY 13902-6000 or fax (607) 777-6897.

*Note: Financial Aid services will begin processing PLUS applications for 2009-10 after July 1st, as the Department of Education will not accept applications until after this date.

  
Step 3- Obtaining credit approval                       
Upon receipt of the application, Binghamton University will submit the parent borrower data to the Direct Loan Servicer for a credit check process. If the application is approved, the parent must complete an online Master Promissory Note (MPN) at  http://dlenote.ed.gov.  Paper MPNs are available upon request.

Note: No money will be disbursed until the credit check and promissory note processes are complete.

If the application is denied, the parent has four options. The parent will be asked to indicate his/her preference on the application.

  1. Request a review of credit check due to inaccurate information on the credit report. Contact the Direct Loan Servicer at 1-800-848-0979.
  2. Obtain an endorser. The endorser must pass a credit check. Contact the Direct Loan Servicer at   1-800-848-0979.
  3. The parent may not wish to pursue the PLUS loan; no further action to be taken at this time.
  4. Allow the student the option to receive additional Federal Direct Unsubsidized Loan. Additional Loan Limits: Up to $6,000/academic year: 1st and 2nd year students (55 or less credit hours earned). Up to $7,000/academic year: 3rd and 4th year students (56 or more credit hours earned).

Step 4- PLUS funds arrive
PLUS loan funds will be forwarded to Student Accounts via Electronic Funds Transfer (EFT), and will be applied to the applicable student’s account.  If the account is paid in full and there are remaining PLUS proceeds, a refund check will be issued and mailed to the parent borrower.

sm061406_tower2_jwc.jpg