Grad PLUS Loan - FAQs

• The applicant is 90 days or more delinquent on the repayment of any debt
• The applicant has had any debt discharged in bankruptcy during the five-year period before the date of the credit report
• The applicant has been the subject of a default determination on any debt, a foreclosure, a tax lien, a repossession, a wage garnishment or a write-off of a Title IV debt during the five-year period before the date of the credit report

• Must complete the Free Application for Federal Student Aid (FAFSA)
• Must be enrolled or accepted for enrollment in an eligible program at an eligible institution
• Must be enrolled at least half time
• Must certify, as part of the FAFSA filed with the U.S. Department of Education, a statement of educational purpose
• Must be determined to have no adverse credit
• Unless exempt, a male student must register with the Selective Service
• Must have at least a high school diploma or the recognized equivalent of a high school diploma or the student must meet one of the following standards: The student must (a) be beyond the age of compulsory school attendance in the state in which the post secondary school is located and (b) pass an independently administered ability-to benefit test that has been approved by the Department. Or must have - and may self-certify that he or she has - completed a secondary school education in a home school setting that is treated as a home or private school under applicable state law.
• Must meet the guarantor's requirements with respect to state of residence or regional service area
• If already enrolled, maintains satisfactory academic progress in his or her course of study according to the school's published standards
• Must be a U.S. citizen or national, or eligible non-citizen, as applicable
• Must fulfill additional requirements imposed by the guarantor of a loan for which the principal and interest have been discharged or written off
• Must provide his or her valid Social Security Number
• Before applying for a Federal Grad PLUS Loan, a graduate or professional student must apply for and the school must determine the student's eligibility for the maximum annual subsidized and/or unsubsidized Federal Stafford Loan amount. Note, however, that a graduate or professional student is not required to receive Federal Stafford Loan funds as a condition for receiving a Federal Grad PLUS Loan and the school may not require a graduate or professional student to receive Stafford loan funds before the student may apply for a Federal Grad PLUS Loan.
• Must not be in default on any federal education loan
• Must not be liable for an overpayment nor have exceeded annual or aggregate limits imposed on any other Title IV program
• Must not have borrowed in excess of any annual or aggregate Federal Stafford Loan limit
• Must not have been determined ineligible solely due to the individual's error or as a result of providing false or misleading information for a FFELP loan that has already been obtained
• Must not have property subject to a judgment lien for a debt owed to the United States
• Must not be serving in a medical internship or residency program required of doctors of medicine, osteopathy and optometry. Students who are serving in an internship as part of any other degree program (e.g., a dental or veterinary internship) are considered eligible students for purposes of Stafford loans and PLUS loans, as applicable.
• Must not have fraudulently borrowed a loan, provided information that caused his or her loan to exceed applicable annual loan limits during an academic year, nor knowingly exceeded an aggregate loan limit for the Federal Family Education Loan Program, Federal Direct Loan Program or Federal Perkins Loan Program
• Must not have had his or her eligibility for Title IV aid denied due to conviction of possession or distribution of an illegal drug within prescribed time frames
• Must not be incarcerated at the time funds are disbursed or delivered

• Complete the Free Application for Federal Student Aid (FAFSA).
• If you're eligible to borrow funds under the Graduate PLUS loan program, you have two options:
  • Apply online
  • Call us toll-free at 1-800-487-4404 and a Student Loan Specialist will assist you with your new Graduate PLUS loan application and will answer any questions you may have about financing your education.

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For all Grad PLUS loan periods, including repayment, forbearance and deferment, the statutory interest rate for loans disbursed on or after July 1, 2006, is fixed at 8.50%.

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For Federal Grad PLUS Loans Chase offers a 0.25% interest rate reduction for having monthly payments automatically deducted from your bank account (ACH) by Chase.*

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The repayment period on a Grad PLUS loan begins on the date of the last disbursement made on the loan unless you receive an in-school deferment; interest accrues from the date of the first disbursement on the loan. The first payment is due within 60 days after the loan is fully disbursed unless you receive an in-school deferment. For Grad PLUS loans first disbursed on or after July 1, 2008, you are also entitled to a six-month grace period after you cease to carry at least half-time enrollment. You have up to 10 years (excluding periods of authorized deferment or forbearance) to repay a Grad PLUS loan. You may prepay all or any portion of your loan at any time without penalty. Prepayment is encouraged as it can significantly reduce the total amount of interest paid over the life of the loan.

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Generally, you have up to 10 years to repay a PLUS loan (excluding periods of authorized deferment and forbearance). Lengthening the term will significantly reduce your monthly payment, although you should note that an extended repayment term will increase the total amount of interest you will pay on your loan. However, since there are no prepayment penalties under this program, you can reduce your interest costs by increasing the amount you pay each month or by paying off your loan early without penalty or fee.

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Once the payment due date is established, it cannot be changed. However, you have the option to make a payment at any time before the due date.

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You may prepay all or any portion of your loan at any time without penalty. Prepayment is encouraged as it can significantly reduce the total amount of interest paid over the life of the loan.

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No. You can repay your PLUS loan early without a penalty or fee.

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Yes. Your PLUS loan is authorized in Part B of Title IV of the Higher Education Act of 1965, as amended (the "FFELP" program). Under the PLUS loan program, you can obtain low-cost student loans to help pay for the cost of higher education. The PLUS loan is made to parents of eligible students or to graduate students by lenders. The lender cannot require you to provide collateral for the loan. To protect the lender from loss in the event of the borrower's death, disability, bankruptcy or default, the loan is guaranteed by a guarantor. In certain circumstances, the lender also is protected if the student attends a school that closes or if the school falsely certifies the borrower's loan. Guarantors are reinsured by the U.S. Department of Education for all or part of the amount of the default claims it pays to lenders.

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HOPE Scholarship and Lifetime Learning Tax Credits
These programs reduce the amount of your federal taxes based on qualifying "out-of-pocket" educational expenses paid for yourself, your spouse or your dependent child. Only one of these tax credits may be claimed per tax year.

HOPE Scholarship Tax Credit
With this tax credit, you can receive up to $2,500 per eligible student for a taxpayer paying education-related expenses. This represents 100% of the first $2,000 of your out-of-pocket educational expenses for each student, plus 25% of the next $2,000.

The HOPE Scholarship credit can be increased to $3,600 for enrollment in an eligible institution located in a Midwestern disaster area.

Lifetime Learning Tax Credit
With this credit, you can claim a maximum credit of up to $2,000 (20% of the first $10,000). This credit is calculated per family, not per student.

The Lifetime Learning credit can be increased to $4,000 for enrollment in an eligible institution located in a Midwestern disaster area.

Because tax credits and deductions phase out at certain income levels, we encourage you to consult with your tax advisor and review IRS Publication 970, or call the IRS information line at 1-800-829-1040 to determine your eligibility and learn how these benefits apply to your specific situation.

New changes in the tax code may offer favorable tax advantages when you finance your child's education with a PLUS loan.¹ There is now an unlimited timeframe for student loan interest deductions — depending on your income you may be entitled to deduct interest regardless of the age of your loan. In addition, eligibility requirements are more flexible, so deductions are available to a wider group of taxpayers. We encourage you to learn more about the potential tax benefits.

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You can apply now, or call the toll-free number above to apply for a Federal PLUS loan.

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Yes, payments can be postponed until after graduation, and for Grad PLUS loans first disbursed on or after July 1, 2008, you are also entitled to a 6 month grace period beginning after you graduate or cease at least half-time enrollment. You are responsible for interest that accrues during the deferment period. If you do not make payments on the interest that accrues during this period, it will be added to the loan balance, increasing the size and cost of the loan.

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