Federal Direct PLUS Loan (Parent & Graduate/Professional Student)

December 1, 2018

Deadline to apply for Fall only loan 

April 26, 2019

Deadline to apply for academic year or Spring only loan


(For Summer 2018, view the process to apply for a Parent or Graduate PLUS loan. The information that follows is new for Fall 2018-Spring 2019).


What is a PLUS Loan?

The PLUS loan is a federally funded loan from the U.S. Department of Education. 

Students must be enrolled at least half-time (6 undergraduate units; 4 graduate units).

PARENT loan is for parents/stepparents of dependent undergraduate students. Stepparents are eligible as long as their information is included on the Free Application for Federal Student Aid (FAFSA). 

GRADUATE/PROFESSIONAL student must be accepted and enrolled in a master's degree program. 

What will my interest rate and origination fee be?

Interest rate of 7.60%on all PLUS Loans disbursed on or after July 1, 2018

Interest accrues on the unpaid balance of the loan from the date of disbursement by the school until the entire principal balance is paid in full. Failure to make monthly or quarterly interest payments results in the interest being capitalized (added to the principal of the loan). Currently, a 4.264% origination fee is deducted upfront of each disbursement prior to October 1, 2018. After October 1, 2018, an origination fee of 4.248% will be deducted.

How much money am I eligible to borrow?

Unlike other types of financial aid, the PLUS Loan is not need based. The maximum eligibility amount is determined by the Student's Cost of Attendance minus any financial aid that the student has been awarded.

The PLUS loan can replace all or a portion of the expected resources. If the student will not be receiving financial aid of any kind, applicants can borrow the full cost of attendance. Parents/Graduate students do not have to apply for the entire amount. Parents/students should calculate the amount they need. Refer to the student’s Award Offer on their my.sjsu.edu portal for the amount of the PLUS Loan eligible to borrow. PARENTS: if your student does not intend on using Federal Work Study, you can add that amount to the PLUS loan request.

How do I apply for the PLUS Loan?

Step 1 

  1. Student accepts the PLUS loan offered on their MySJSU. Next, the borrower (parent or graduate student) goes to StudentLoans.gov and logs in with their FSA User ID & Password
  2. Once logged in, click on "Apply for a Direct Plus Loan"
  3. For type of Direct PLUS Loan Application, select "START" under

Direct PLUS Loan Application for Parents

Direct PLUS Loan Application for Graduate/Professional Students

Award Year: 2018- 2019

School Name: SAN JOSE STATE UNIVERSITY

PARENTS: You will be asked if you wish to request for a deferment (postponement) of your loan payment while your student is enrolled, as well as if you wish to request a 6 month deferment if your student ceases to be enrolled at least half time. You will also be asked if you would prefer to have any credit balance after fees have been paid to the school sent to either you (the parent borrower) or directly to your student.

GRADUATE/PROFESSIONAL STUDENTS: After submitting the application successfully, the credit decision is displayed immediately on the next screen, if the credit is approved, this indicates you are eligible to borrow the Graduate PLUS loan.

Loan Amount Requested:

Indicate the amount you wish to borrow. You can request any amount not to exceed the maximum amount offered on your student’s MySJSU award notice.

Loan Period Options:

  • Fall 2018 to Spring 2019 (08/2018 - 05/2019)
  • Fall 2018 only (08/2018 - 12/2018)
  • Spring 2019 only (01/2019 - 05/2019). Process available in November.

Step 2

After the credit is approved, first-time PLUS Loan borrowers must also complete an online loan agreement known as a Master Promissory Note (MPN). If you completed a MPN for a previous San Jose State University PLUS Loan, you may not need to complete this step.

  1. Go to StudentLoans.gov and log in with your FSA User ID & Password
  2. Once logged, click on "Complete Loan Agreement (Master Promissory Note)"
  3. For type of Direct Loan MPN, select "START" under Direct PLUS Loan Application for:

PLUS MPN for Parents or Graduate/Professional Students 

Step 3: Graduate/Professional Students only

First-time Graduate PLUS Loan borrowers must also complete loan counseling known as Loan Entrance Counseling. If you completed Loan Entrance Counseling for a previous San Jose State University Graduate PLUS Loan, you may not need to complete this step.

  1. Go to StudentLoans.gov and log in with your student FSA User ID & Password
  2. Once logged, click on "Complete Loan Counseling"
  3. For type of Loan Counseling, select "START" under Entrance Counseling
  4. For type of Loan Student, select "I am completing entrance counseling to receive Direct Loans as a graduate or professional student.

* Note: After all the steps are completed successfully, allow up to 3 weeks for processing and for PLUS loan checklist items to be updated from the student's To Do List.


What happens if my PLUS  application is denied?

PARENTS:

The school will automatically offer the student an additional Unsubsidized loan in the student’s name; annual limits and a student's Cost of Attendance budget apply:

  • Freshmen and Sophomore class level, maximum additional Unsubsidized Loan for the academic year: $4,000 
  • Junior and Senior class level, maximum additional Unsubsidized Loan for the academic year: $5,000

Option 1 - Appeal:

  1. Appeal the decision by calling Direct Loan Servicing Center at 1 (800) 557-7394
  2. If the appeal is approved, you must complete an additional loan counseling known as PLUS Credit Counseling. PLUS Credit Counseling is a requirement if you had an adverse credit history but were able to document extenuating circumstances to the satisfaction of the U.S. Department of Education.
  3. Go to StudentLoans.gov and log in with the borrower FSA User ID & Password
  4. Once logged in, click on "Complete PLUS Credit Counseling"
  5. Let the Financial Aid and Scholarship Office know that you have successfully appealed your credit decision by filling out the PLUS Addendum form (LINK to form available soon)

Option 2 - Endorser:

  1. Secure an endorser willing to cosign the PLUS Loan
  2. The endorser will create an FSA User ID & Password
  3. The endorser logs in to StudentLoans.gov and click on "Complete an Endorser Addendum"
  4. If the endorser is approved, the borrower must complete an additional loan counseling known as PLUS Credit Counseling. PLUS Credit Counseling is a requirement if you had an adverse credit history but were able to obtain an endorser.
  5. Let the Financial Aid and Scholarship Office know that your endorser has been approved by filling out the PLUS Addendum form (Link to form available soon)

What if I change my mind about the PLUS Loan after applying?

Approval of a PLUS Loan application does not commit you to accepting the loan. If approved, you must contact the Financial Aid and Scholarship Office to cancel or reduce the accepted PLUS Loan amount. You can also fill out the PLUS addendum form asking us to cancel the loan (Link to form available soon)

How will I receive my PLUS Loan funds?

If the loan is a full year loan, the loan will be disbursed half in the fall and the other half in the spring semester. If the loan is for one-semester, the loan will be disbursed in one disbursement.

If the student owes money to San Jose State University, the university deducts all financial obligations first, and forwards the balance to the borrower. For a PARENT PLUS loan, a check is sent to the parent if the borrower is the refund preference. Otherwise, if the student is the refund preference, a check is sent to the student or direct deposit is initiated. We encourage students to sign up for direct deposit.

When will I have to begin repaying the PLUS Loan?

Repayment and interest will apply to funds after the loan has been disbursed. The first payment of interest and principal are due within 60 days after the loan is fully disbursed.

An in-school deferment may be requested while the student is enrolled at least half time (6 undergraduate units; 4 graduate/professional units). PARENT: If the student drops to less than half time or withdraws during the period for which the loan was intended, the entire amount of the PLUS Loan is immediately due. GRADUATE/PROFESSIONAL students: Interest that accrues will be capitalized if not paid by the student 

Contact:

Philip Smith
Philip.Smith@sjsu.edu

408-924-6109