Federal Direct Graduate PLUS Loans
The Federal Direct Graduate PLUS Loan is an unsubsidized loan for graduate/professional students. PLUS Loans help pay for education expenses up to the cost of attendance minus all other financial assistance. The application process includes a credit approval requirement and interest is charged during all periods, including eligible periods of deferment. If a PLUS loan application is credit-denied, applicants may appeal the credit decision with the Department of Education or reapply with a creditworthy endorser, and will be required to complete PLUS Credit Counseling.
The Department of Education has developed a process that all Direct Loan borrowers (subsidized, unsubsidized, graduate PLUS, and parent PLUS) are encouraged to complete, called the Annual Student Loan Acknowledgement (ASLA). The ASLA (formerly known as the Informed Borrower Confirmation process) is intended to better assist borrowers in understanding the financial responsibility of funding their education and provide current information on a borrower's cumulative loan balance. As part of the Master Promissory Note (MPN) confirmation process, the ASLA, allows student and parent borrowers to view how much they currently owe in federal student loans, and to acknowledge that they have seen these amounts, before borrowing new loans each award year. The ASLA may be completed each year in addition to Direct Loan Entrance or PLUS Credit entrance counseling that may be necessary. The ASLA becomes available for completion online at studentaid.gov/asla each April.
Creditworthy borrowers may borrow up to the full cost of attendance minus any other aid received. Repayment begins six months after the last disbursement is made and can be deferred by contacting your loan servicer to request a deferment. Direct PLUS Loans can be deferred while the graduate student is enrolled at least half-time and for an additional six months after the graduate student ceases to be enrolled at least half-time (a minimum of six graduate-level credits).
In-school deferment can be requested at the time the PLUS application is completed online at studentaid.gov. In most cases, the Direct Loan Servicing Center will automatically grant an in-school deferment on your Direct PLUS Loan based on information reported to the U.S. Department of Education by the Office of the Registrar showing that you are enrolled at least half-time. The first payment on a Direct PLUS Loan will be due within 45 days after the deferment end date. The Direct Loan Servicing Center (DLSC) will notify students 60 days before the deferment ends. The Direct Loan Servicing Center will notify you of the deferment and of your option to cancel the deferment and begin making payments on your loan. If you are unable to make payments on your Direct PLUS Loan after you leave school and your in-school deferment ends, you may request a forbearance that will allow you to temporarily postpone payments. You will have to explain why you are unable to make payments. To request a forbearance, contact the Direct Loan Servicing Center at 800-848-0979.
If the Direct PLUS Loan is deferred, interest will accrue on the loan during the deferment. You may choose to pay the accrued interest or allow the interest to capitalize when the deferment period ends. Your loan servicer will notify you when your first payment is due. Information about the William D. Ford Federal Direct Loan Program can be found at studentaid.gov.
Federal Direct Loan interest rates change from year to year (in July) and may also change specifically for one type or the other; Subsidized or Unsubsidized, Graduate, or PLUS. For loans disbursed after July 1, 2022, the interest rate for Direct PLUS loans is 7.54 percent. Students who received loans prior to the aforementioned date and who still have balances outstanding on those loans will continue with the interest rate rules in effect at the time of their original loans. There is also an origination fee that will be deducted from the principal amount borrowed. The origination fee represents the lender's (the federal government) fee for making the loan. For Direct PLUS loans disbursed after October 1, 2022, the origination fee is 4.228 percent. The table below describes annual and aggregate maximum eligibility for the Federal Direct Unsubsidized and Graduate PLUS Loan Programs.
Annual and Aggregate Loan Limits for Federal Direct Unsubsidized and Graduate PLUS Loan Programs
|Graduate Annual Limit|| Aggregate Limit|
Including Undergraduate and Graduate Amounts
|Unsubsidized Direct Loans*||$20,500*||$138,500|
|Federal Direct Graduate PLUS Loans||Cost of Attendance, Minus Other Aid||Cost of Attendance, Minus Other Aid|
* Ineligible for Subsidized Loans
On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) became law and provided emergency COVID-19 relief measures on federal student loans owned by the Department of Education. The relief measures, which began on March 20, 2020, include suspension of loan payments, stopped collections on defaulted loans, and a zero percent interest rate.
On November 22, 2022, the student loan payment pause and zero percent interest rate were extended until 60 days after the federal debt relief program is implemented or litigation is resolved. Payments will resume 60 days after June 30, 2023 if the debt relief program is not implemented and the litigation has not been resolved. The Department of Education will notify borrowers before repayments restart. More information is available at studentaid.gov.