<p>Ok, so my school gave me some scholarship money, some student loans, then it says I have been awarded about $15,000 in Parent Plus Loan, but my parents have to complete an application. While completing the application, it gives an option to apply for the the amount that the school says, which in this case is the $15,000. Does this mean my parents are ALREADY eligible for the $1500, and the application is just a way for them to put their information on file, or is the purpose of the application to see if they will qualify for the $15,000 or not? It would suck for them not to be eligible, and me not being able to go to that school because I can't pay for it, then have to go to cc for a while because this all happened after decision day. So are my parents pretty much eligible for the money and just have to file an application, or not? THANKS!</p>
<p>It is to qualify, but the qualifications are pretty easy to meet. They cannot be in default on any federal loans (their own student loans, a federal mortgage, etc.) and they cannot be more than 90 days delinquent on any payment in the past 5 years.</p>
<p>But this is a big loan for your parents to take out and they should consider if they want to have that kind of loan, in addition to your Stafford loans. That would be $60,000 in PLUS loans for 4 years, plus you’ll have about $30,000 in Stafford. That’s a lot.</p>
<p>Why did you just learn about the Plus Loan after decision day?</p>
<p>Have your parents said that they will borrow $60k for college? that is a lot of debt and most parents will not do this.</p>
<p>No. Your parents haven’t been awarded anything. The school has just suggested that your parents apply for the loan. They have to APPLY and be approved. The amount they can borrow is whatever the school COA is minus any other aid you have gotten in your package. The $15k could be that number or the gap between their EFC and what else the school has stuck in your package. </p>
<p>Only one parent applies. Doesn’t need a job or income, but a credit check is quickly done for any accounts past 90 days due, any judgements, liens, bankruptcies in the past 5 years or so. Credit scores are not used however. if one parent is turned down, the other can apply. The parent has to have a PIN. The loan is close to 7% interest and it starts cranking as soon as the funds are disbursed. </p>
<p>If a parent is turned down, you can automatically get an additional $4K in Direct Loans. </p>
<p>From the Internet:
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<p>Of course if they can come up with all or some of the money without borrowing it, they can borrow less than the $15k or none of it.</p>
<p>From the Federal Student Aid website:
PLUS loans are federal loans that graduate or professional degree students and parents of dependent undergraduate students can use to help pay education expenses. The U.S. Department of Education makes Direct PLUS Loans to eligible borrowers through schools participating in the Direct Loan Program.</p>
<p>Here’s a quick overview of Direct PLUS Loans:</p>
<pre><code>The U.S. Department of Education is the lender.
The borrower must not have an adverse credit history.
The maximum loan amount is the student’s cost of attendance (determined by the school) minus any other financial aid received.
</code></pre>