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What is the average rate of a federal plus loan?
The average rate of a Federal Direct Parent Plus Loan and Federal Direct Plus Graduate Loan is now 7.9%. This rate is fixed for the life of the loan and cannot exceed 8.25%.
What is a federal direct plus loan?
The Federal Direct Student Loan program is loan given to students in the United States. If you feel that you are in need of the perfect loan, then maybe this is the right one for you since it is a government loan.
What is the best federal student loan program?
There are many federal student loan programs to choose from. They include Federal Perkins Loan, Federal Direct Subsidized Loan, Federal Student PLUS Loan, etc. When it comes to deciding which is the best, it depends on one's circumstances.
What does a PLUS loan enable one to do?
The Federal Direct Plus loan is one of the low interest loans that enables students and parents to receive funds directly from The U.S. Department of Education to pay for education after high school.
If you have accumulated bad credit while in college can you be denied financial aid?
You can be denied private loans, and grad plus loans for late payments on your credit history. If you default on a federal student loan, you will lose eligibility for all federal financial aid (including grants).
Grad PLUS loans a good option for financing graduate school?
Financing graduate school can be expensive. An important option to consider for covering the total cost of graduate school (including tuition and living expenses) is a Graduate PLUS Loan. The federally-guaranteed loans are available to U.S. citizens who attend graduate school at least half time and have acceptable credit. Benefits of a Grad PLUS Loan Grad PLUS loans are available to cover the total cost of graduate school such as tuition, room and board, living expenses, textbooks, supplies, lab costs, and other out-of-pocket expenses minus any other financial aid received. Loan eligibility for a Grad PLUS loan is not based on need nor is it awarded based on a particular FICO score. Grad PLUS loan recipients do need to have credit without an adverse credit history or have a co-signor with a good credit record. Grad PLUS loans can be used for online graduate degree programs if the program is offered by a college or university that accepts federal financial aid. Rates are fixed at 7.9 percent and will not change throughout the life of the loan. Up front fees of up to 4 percent can be charged by the lender, bringing the total interest rate maximum to 8.85 percent. Interest is tax-deductible for many students. The Downside to a Grad PLUS Loan Payments on the Grad PLUS loan are due to begin 60 days after the loan is funded, although most schools can file for a deferment from the Department of Education. If a graduate student falls below the half-time requirement, payments are due within 45 days. As with all federally-subsidized financial aid, a Grad PLUS loan cannot be discharged as part of bankruptcy. The interest rate can be slightly higher than other graduate school financial aid, so be sure to thoroughly research all of the graduate school financing options available. There are several websites with more detailed information about Grad PLUS loans: Student Loan Network's Gradloans.com: www.gradloans.com/graduate-plus-loan, Information for Financial Aid Professionals' website: www.ifap.ed.gov/dlbulletins/attachments/DLB0703Attach.pdf and U.S. News & World Report's website: http://www.usnews.com/education/best-graduate-schools/top-graduate-schools/paying/articles/2011/03/16/graduate-plus-loan-faqs.
What is a good alternative to grad plus loan?
There are not many options to the student available in avoiding the encumbrance of a grad plus loan. However, there are good alternatives. One good alternative is seeking a private aid loan. A private aid loan will allow a parent to assist and defer payments. It may be an alternative that will work well in saving money and saving finances, and eliminating a heavy financial burden.
What does FFELP mean?
Federal Family Education Loan Program. This program offers Stafford, Parent and Grad PLUS, and Federal Consolidation loans. The loans are made by private lenders and insured by the federal government. Your eligibility for these loans, and how much you can borrow, is determined by your school's financial aid office, using the data from your FAFSA.
Federal PLUS Loan?
The Federal PLUS Loan is a low interest loan that can be obtained either by parents to pay for the post-secondary education of their dependent children or by graduate students to cover the educational expenses associated with obtaining their own graduate or professional degrees. The Federal PLUS Loan is serviced by the U.S. government through the Department of Education and is part of the government's Direct Loan program. Interest rates for the PLUS loans are fixed at 7.9% for the term of the loan with a 4% fee. The cap for PLUS loan amounts is set at the difference between the cost of attendance and the financial aid, including grants and loans.The Advantages and Disadvantages of a Federal PLUS LoanFederal PLUS loans offer various advantages over loan serviced by private lenders. The most significant advantage is that the Federal PLUS loan is fixed at a relatively low interest rate of 7.9% for the life of the term instead of a variable interest rate for private loans. Federal direct loans will also never be sold to or serviced by any other lender, can be consolidated, and do not require a separate application besides the financial aid application submitted to the student's institution. The disadvantage with a Federal PLUS loan is that it does not allow individuals to privately negotiate an interest rate and take advantage of individual credit-worthiness. In addition, Federal PLUS loans do not offer fee subsidies that some private loans do.The Federal PLUS Loan EligibilityIn order to be eligible for a PLUS Loan, the borrower, who may be the student or the parent, must have no adverse credit history and the borrower and the student must be enrolled at least half-time in school. After credit eligibility has been confirmed, borrowers need to complete a PLUS Loan Application and Master Promissory Note. The Master Promissory Note binds the borrow to repay the loan amount and any accrued interest and fees to the U.S. Department of Education. In order to obtain more information, students and their parents may visit the U.S. Department of Education's PLUS website.
How can one apply for a Direct PLUS loan?
It is possible to apply for a Direct Plus loan directly online through the official Government's Direct website or also through the Governments official student finance website.
Which federal loan can help cover expenses not met by other federal financial aid?
The federal loan that can help cover expenses not met by other federal financial aid is the Direct PLUS Loan. This loan is available to graduate students and parents of dependent undergraduate students, allowing them to borrow up to the full cost of attendance minus any other financial aid received. It can be used to cover additional educational expenses, such as living costs and books.
Federal Direct Parent Loan?
Most college undergraduates and their family will need to locate several different loan programs, scholarships or grants in order to fully fund postsecondary education. In addition to the student loans made available by the federal government, parents can apply for a Direct PLUS Loan and make up the difference between the amount of financial aid already awarded and the actual costs of tuition, room/board and student expenses.What Parents Can Expect With A PLUS LoanUnlike a federal grant for education, a Direct PLUS Loan must be repaid. Parents seeking financial aid for their child through the federal government must qualify in several areas. These include a favorable credit history, proof of any financial contributions that can be made for the student's college education and documentation showing legal custody of the student. Graduate students who are living independently may apply for their own federal PLUS Loan, but parents can only obtain funding for dependents.Applying For A Direct PLUS LoanParents will need to fill out and submit a special application provided by the U.S. Dept. of Education. The application also requires the parent to complete and sign a promissory note stating their intention of repaying the loan plus accrued interest. If awarded a loan, disbursement of funds is made directly to the financial aid office at the college or university. Parents can apply for more than one Direct PLUS Loan for other dependents, even if the students are attending different schools. The parent will be able to track disbursements and view the total amount of the repayment by contacting a servicer appointed by the government.Information On Interest Rates And RepaymentA Federal Direct PLUS Loan begins to accrue interest from the moment the first disbursement is completed. The government does not subsidize this loan and therefore all of the interest must be paid in addition to the principal balance. Repayment is deferred so long as the student is enrolled more than half-time, or is taking at least 10 quarter or semester hours of credits. Repayment begins no more than 60 days after the student graduates or leaves the school. The repayment is through the servicer contact. The interest rate on a federal parent Direct PLUS Loan is 7.9 percent. If the loan is taken out through a bank, credit union or other financial institution it may be guaranteed against default by the federal government. Repayment plans vary according to the individual family's situation, but generally the repayment period for this loan is 10 years.
