Federal Direct Graduate PLUS Loan
The Federal Direct Graduate PLUS Loan (Grad PLUS) is a loan limited to graduate students. While it has terms similar to and takes its name from the Federal Parent Loan for Undergraduate Students (PLUS), the graduate student – and not their parent – is the borrower.
Like other student loans, the Grad PLUS Loan has a 10-year repayment cycle. However, repayment is not automatically delayed until after the graduate student leaves school. Students can seek an in-school deferment option though interest will be accumulating during this time.
Grad PLUS, unlike other student loans, is credit-based. The borrower will be reviewed for adverse credit including past credit on-time payment history. Also, unlike other student loans, a student interested in it will need to apply as the Federal Graduate PLUS Loan is not automatically awarded to you.
Interest, Fees & Lender
Federal Direct PLUS Loans have a competitive interest rate set annually. As Direct Loans, the Department of Education acts as lender. PLUS Loan fees are also charged when the loan is originated. Because Federal Direct Unsubsidized Loans have lower origination fees and interest rates than Grad PLUS, it is recommended to accept all Unsubsidized Loan eligibility prior to determining if you wish to accept Grad PLUS Loans.
Grad PLUS is a helpful way for students to address educational expenses through a federal, low-interest loan that spreads costs over a longer period and allows for manageable, monthly payments. It is a federal option to lessen reliance on alternative educational loan borrowing.
Graduate may borrow up to the cost of attendance minus all other financial aid the student will receive. The remaining cost of attendance is available within Catalyst (catalyst.uc.edu).
- Go to the "My Finances" tile.
- Hit "Manage Financial Aid" and then "View Financial Aid."
- Select the year you wish to review.
- Use the "Financial Aid Summary" link toward the bottom of the display to see your cost of attendance, aid summary, and remaining financial need.
- Cost of attendance information is also found on your initial award offer for the academic year (the one that includes videos) by adding the listed direct and indirect costs.
- Your maximum Grad PLUS eligibility is your cost of attendance minus your aid.
NOTE: Because your maximum eligibility is cost of attendance minus your aid, it is important to know that all aid sources (especially any scholarships from your academic department) are awarded or accounted for when calculating your maximum Grad PLUS eligibility.
Of course, you do not need to borrow the maximum. You may well wish to limit overall debt and elect to borrow a lesser amount. Many students will used their bill with their financial aid offer to calculate a Grad PLUS amount to meet billed costs. Also, you can contact Enrollment Services (513-556-1000; firstname.lastname@example.org) to help determine a Graduate PLUS Loan amount, particularly if you are targeting specific costs to be met with the loan.
Applying for the Grad PLUS Loan
The Federal Graduate PLUS Loan process begins at studentaid.gov where you will log on using your Federal Student Aid (FSA) ID.
- Complete credit check for loan approval.
- Click on the tab that says "In School" and select "Apply for a PLUS Loan for Graduate School."
- Fill out the application and submit.
- For amount you can specify an amount to borrow for the year or indicate "maximum eligibility."
- Credit check information is only valid for 90 days.
- Limited options are available if the loan is denied based on credit.
- Sign a PLUS Master Promissory Note (MPN).
- Because an MPN is a multi-year loan agreement, borrowers who have an active Grad PLUS MPN on file will not need to complete a new MPN following loan approval.
- If no Grad PLUS MPN is on file, follow the links for the MPN within the approval.
- You can also go to studentaid.gov and "In School" tab to use the link that says "Complete a Loan Aggreement (Master Promissory Note/MPN)" and then choose the graduate student option.
- Complete the MPN providing all required information.
- Electronically sign your MPN using your Federal Student Aid (FSA) ID.
UC will be informed of your loan approval and completion of the Grad PLUS MPN. Student Financial Aid will then process the Graduate PLUS Loan that will show as part of your award offer. The amount of the loan will be based on the amount requested on the MPN or the maximum eligibility, whichever is lower. It is then certified by UC and set for disbursement at the appropriate time. This process of awarding and certifying the loan can take up to 10 business days following the completion of the application process at studentaid.gov.
In cases of increases or decreases to a Graduate PLUS Loan already certified by UC and showing on your award offer, please contact Enrollment Services.
When the Grad PLUS borrower applies for the loan at the studentaid.gov and each time a borrower applies for or increases a Grad PLUS Loan during subsequent borrowing, a credit check is performed. Students denied the Grad PLUS Loan may need to seek a credit-strong endorser for loan approval.
Adverse credit such as bankruptcy, foreclosure, tax lien, or a default determination will limit a student from borrowing the PLUS Loan. A graduate student also has an adverse credit history if the PLUS applicant has:
- One or more debts that are 90 or more days delinquent or that are in collection or have been charged off during the two years preceding the date of the applicant’s credit report; and
- A total combined outstanding balance of those debts greater than $2,085.
Master Promissory Note & Loan Counseling
The Grad PLUS Master Promissory Note (MPN) is an open-ended loan note that allows borrowing for up to 10 years. Because each loan program has a unique MPN, new Grad PLUS borrowers will have to complete the Grad PLUS promissory note even if they have an MPN on file for another type of student loan.
Students borrowing a Federal Grad PLUS Loan at UC for the first time will also need to complete specific Grad PLUS Loan Entrance Counseling. While it is similar to loan counseling required when you took out a Federal Subsidized or Unsubsidized Loan, it again demonstrates the U.S. Department of Education and UC's commitment to having you understand the responsibilities of your loan borrowing.
Failure to complete these requirements can hold up the posting of your loan funds to your student bill and creation of any refund payments and may result in late payment fees.