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A Federal Parent PLUS Loan is an education loan designed for parents of dependent, undergraduate college students enrolled at least half time. Parent PLUS loans are available without regard to income or assets and can help you fund your child's education. With a Parent PLUS Loan, you can borrow up to the full cost of your child’s education, less other aid received.
Parent PLUS Advantages
- With a PLUS loan, you can borrow up to the full cost of your child's education less other financial aid received.
- PLUS loans require no collateral
- PLUS loans may be used to pay for authorized education expenses such as tuition, room and board, supplies, and equipment — often including personal computers — as well as transportation and commuting costs.
- PLUS loans have flexible repayment options
- Interest paid on PLUS loans may be tax deductible. Check IRS Publication 970, chapter 4, "Student Loan Interest Deduction" for more information.
- PLUS borrowers can earn a money-saving borrower benefit when choosing Southwest as lender.
Eligibility
- Borrower must be a parent of an undergraduate, dependent child who is enrolled at least half-time at a participating college or university. Parents of independent or graduate students are not eligible.
- Borrower must be a U.S. citizen or national, a U.S. permanent resident, or eligible non-citizen
- A credit check is required. There are no income minimum or maximum requirements; however, borrower cannot have an adverse credit history.
Interest Rate and Fees
- A fixed interest rate of 8.5% for loans disbursed on or after July 1, 2006 and before June 30, 2009
- Fees equal to 4% are deducted at disbursement
Repayment
- Begins within 60 days after receiving the funds; OR for loans disbursed beginning 7/1/08, parents have the option to postpone repayment until 6 months after the beneficiary student leaves school or drops below half-time enrollment. If payments are postponed, interest will accrue and be capitalized on the unpaid loan balance.
- Borrowers have up to 10 years to repay under standard repayment
- Non-standard repayment options available
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