Direct Graduate PLUS Loan
If you need to borrow funds beyond the federal direct subsidized and unsubsidized loan limits, you may be able to participate in the new William D. Ford Federal Direct Graduate PLUS Loan. The Graduate PLUS Loan will have a fixed 7.9 percent interest rate, a 4.0 percent origination fee deducted at disbursement, and all other federal direct loan criteria. A 1.5 percent rebate is refunded to the student borrower who makes the first 12 monthly payments on time that reduces the origination fee to 2.5 percent. No annual or aggregate borrowing limits are imposed, other than cost of attendance less other financial aid received.
Credit checks
While credit checks are required to be eligible, credit criteria are less restrictive than those for most private student loans. If you do not meet the credit requirements, you may still qualify for the loan if you have someone who does meet the credit requirements endorse the loan. An endorser, unlike a co-signer, is not liable for your Graduate PLUS loan debt if you become permanently disabled or die.
Comparisons
Use the Graduate PLUS Loan vs. private
loan comparison chart to compare the interest rate, credit check requirements,
terms, and repayment criteria
when choosing between the Graduate PLUS Loan and a private educational loan
you may be considering. Private educational loans from commercial lenders are
too numerous to catalog here, so the chart uses typical rates, terms, and conditions
of private lenders. Also, you will also find useful information
in the "Questions and Answers About Direct PLUS Loans for Graduate and Professional Students" flyer from the U.S. Department of Education.
Application
To apply, complete the Free Application for Federal Student Aid (FAFSA). You must first be offered subsidized and/or unsubsidized direct loans. You must accept, reduce, or decline these loans prior to requesting the Direct Graduate PLUS Loan. Then, to have the loan amount you need certified, send an e-mail from your University-assigned e-mail account to helpingu@umn.edu. Use the subject "Graduate PLUS Loan request." In the message section, give your name, student ID number, and indicate the Graduate PLUS Loan amount you would like to borrow. Or you may apply by completing the Student Loan Supplement 2007-2008. Complete, print, sign, date, and send the form to the address given at the top or FAX it to 612-625-3002.
Master promissory note
Before the loan can be disbursed, you must complete a separate master promissory note (MPN). Read carefully all of the terms and conditions of the Graduate PLUS Loan explained in the MPN. By signing the MPN, you promise to repay the loan. You can sign the required MPN electronically with your U. S. Department of Education-issued PIN. If you don't already have their PIN, you can request one on the official PIN site.
The Graduate PLUS MPN can be used for one or more loans in one or more academic years. This means that, in most cases, you may receive additional Direct PLUS loans for up to 10 years without completing a new PLUS MPN.
Entrance counseling
First-time borrowers under this loan program are required to complete entrance counseling. Your loan(s) will not disburse until you have successfully completed the entire entrance counseling process.
Complete the session online at the U.S. Department of Education's student loan entrance counseling site.
Once at the site, make the selection corresponding to your loans:
- select the “Stafford Loan” option if you are a first time borrower of a Subsidized and/or Unsubsidized Federal Direct Loan.
- If you are new only to the Graduate PLUS loan program, select the middle option.
- If you are a first time borrower to both the Graduate PLUS loan program and the Ford Federal Direct Subsidized/Unsubsidized Loan program, select the third box and you will fulfill both entrance interviews.
After completing the tutorial and quiz, you will be guided through four required steps to notify the University of your successful completion. Please note in the third step you must add the University of Minnesota if not previously listed, and select "University of Minnesota – Twin Cities" when school selection is required. You must complete these steps to have your entrance counseling results sent to the University so your funds can disperse. You do not need to submit a paper copy to our office.
Make sure to print a copy of the Borrower's Rights and Responsibilities for your records.