The Federal Direct Parent Loan (PLUS) can be used by a parent to borrow on behalf of dependent undergraduates. The parent borrower may be the student’s mother, father, or stepparent (if the stepparent’s information was reported on the FAFSA). While parents of all income levels are eligible to apply, a credit check is required and performed by the U.S. Department of Education.
Eligible parents may borrow up to the cost of attendance minus any other aid received by the student.
Effective July 1, 2024 through June 30, 2025, the annual interest rate for the Direct PLUS Loan is 9.08%. This is a fixed interest rate for the life of the loan. Interest accrues during all periods beginning on the date of the loan’s first disbursement. PLUS Loans disbursed on or after 10/1/20 are also subject to a 4.228% origination fee which is deducted from the loan at the time of disbursement. For example, if you borrow $1,000, approximately $956.00 will be disbursed to your student's account.
Repayment begins within 60 days after the loan funds for the year are fully disbursed. Parent Direct PLUS Loan borrowers may have the option of deferring repayment.
How to Apply for the Parent PLUS Loan
Step 1. Submit your student’s FAFSA to Reed
Complete your student’s Free Application for Federal Student Aid (FAFSA) at StudentAid.gov. Submit the application using Reed’s Federal School Code (003217).
Step 2. Complete the Direct PLUS Loan Application
Like the FAFSA, the Direct PLUS Loan Application must be renewed to determine annual eligibility. Apply for the Direct PLUS Loan through StudentAid.gov using your parent FSA ID.
Using the Direct PLUS Loan Application, you can:
- Request a Direct PLUS Loan
- Change the amount of a Direct PLUS Loan you previously requested
- Designate to whom the College pays any credit balance
- Request deferment of repayment while your student is in school, and for up to 6 months after
- Authorize how the College may use your Direct PLUS Loan funds to pay for your student’s educational expenses
To qualify for the PLUS Loan, you must not have an adverse credit history. The U.S. Department of Education will run a credit check to determine eligibility. You will be notified of the result of the credit check, and the credit decision will also be sent to the school that you have selected in your application.
Step 3. Complete a Direct PLUS Master Promissory Note
Parent borrowers must complete a Direct PLUS Loan Master Promissory Note (MPN) before receiving PLUS Loan funds. The Direct PLUS Loan MPN explains all of the terms and conditions and is your legally binding agreement to repay all Direct PLUS loans, accrued interest, and fees to the U.S. Department of Education.
Parents must use their own FSA ID when completing a PLUS MPN. If you are requesting a loan for multiple students, you must complete a separate PLUS MPN for each dependent. An MPN is valid for up to 10 years.