Applying for a Federal PLUS loan


Should your student apply for financial aid?

Some parents associate financial aid strictly with "student loans" and are skeptical of suggesting that their student borrow a large amount of loans when they are just getting started in their adult life. However, student loans are just one part of the financial aid package. There is a possibility that your student could be awarded other financial aid benefits such as grants, scholarships, or even work-study.

Applying for financial aid should always be your student's first step in funding his or her education. If your student does borrow student loans, there may be benefits with the loan obligation:

  • Can help build a credit rating for student
  • Interest rate is much lower on federal student loans than on personal loans or credit cards
  • Student doesn't have to make payments on most federal student loans while attending school at least half time (and the government pays interest during this time for some loans)
  • Most students have 6-month grace period after they leave school before required to start making payments (and the government pays interest during this time for some loans)
  • Flexible repayment plans

After your student receives his or her financial aid award, if you want (or need) to help with the costs of education, you may want to consider a Federal PLUS loan.

To apply for a Federal PLUS loan, you, the parent borrower, must complete the Borrower Section of the Master Promissory Note, and your dependent student must complete the Student Section. It's important to understand the terms of the Federal PLUS loan and your responsibility for repaying the loan.

The PLUS Master Promissory Note (MPN)


  • is a binding legal agreement you sign to indicate your commitment to repay your Federal PLUS loan;
  • may be used for multiple loans for up to 10 years if your lender and the school your student is attending uses the multi-year feature;
  • is for loans only for the dependent identified; and
  • contains your rights and responsibilities.

You may be required to sign a new MPN if the school or your lender requires it or if you wish to use a new lender. If you would feel more comfortable completing and signing a new MPN each time you borrow, you may do so. Using the single-year feature, you will sign one MPN for every Federal PLUS loan that you obtain.

The multi-year feature of the MPN will be revoked after the earliest of the following dates:

  • The date your loan holder receives your written notice that no further loans may be disbursed under the note;
  • 12 months after the date you sign the MPN if there have been no disbursements during this 12 month period; or
  • 10 years from the date you sign the MPN.

Your loan holder also may revoke the terms of the MPN in situations such as bankruptcy.

Fast loan facts


  • Every school awards financial aid differently. The school may notify you of the Federal PLUS loan amount you are eligible to borrow, or you may need to request information from the school's financial aid office.
  • You may decline a loan or request a lower amount by contacting your loan holder or the school.
  • You should apply only for what you will need to pay your student's educational expenses each year.
  • You must sign a Federal PLUS MPN for each student.
  • The school or lender may require that you confirm the loan package or each loan disbursement.