Parent Loans for Undergraduate Students (PLUS) Program

parent plus loans

As parents, the task of saving for college is becoming more difficult by the day. The price of the average college education has risen drastically in the last decade. Keeping up is tough. To help parents contribute to their son or daughter’s education the federal government created the PLUS loan.

A Parent PLUS Loan is a student loan offered to parents of students enrolled at least half time in eligible programs at participating and eligible post-secondary institutions or graduate and professional students at participating and eligible postsecondary institutions. The below table offers a comparison of PLUS loans for parents and private lender loans:

Eligibility Requirements

However, there are some requirements parents and children must meet for the parent to be eligible to borrow via a PLUS loan.

Parent:

  • Must be a parent (or step-parent or adopted parent) of a dependent student
  • Be a U.S. citizen or eligible non-citizen and provide a valid Social Security number
  • Pass a credit check from a registered agency
  • Cannot be in default on another federal student loan or owe a refund on any federal student aid program

Student:

  • Must be enrolled at least half-time at the education institution
  • Must be less than 24 years of age
  • Must have NO dependents registered
  • Cannot be in default on another federal student loan or owe a refund on any federal student aid program

Before using PLUS, students should strongly consider using a Direct Federal Stafford Loan or Perkins Loan. What about legal guardians? Legal guardians may not borrow via a PLUS loan. Even so, there are options available in the private loan market. Private loans are an interesting option for credit-worthy individuals willing to take on the financial responsibility of the student loan.