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Federal Direct PLUS Loan

  1. To complete the Federal Direct PLUS Loan Application and Master Promissory Note, go to studentloans.gov.
    • The student must have a FAFSA on file in order for their parent to apply for a Federal Direct PLUS Loan.
    • The parent applying for the Federal Direct PLUS loan does not have to be the parent on the FAFSA.
  2. Sign in with your FAFSA PIN and select "Request PLUS Loan" under the "PLUS Loan Process" heading. Then select the "Parent PLUS" option.
  3. After you have completed your PLUS Loan Application, you can "Complete MPN" under the "Master Promissory Note" heading. Be sure you select the "Parent PLUS" MPN. (Only needed if you are a first time Parent PLUS Loan Borrower without an active MPN)

The Federal Direct PLUS Loan allows parents of dependent students to borrow money to support their child's financial aid package. The loan is used to cover whatever is not already covered by their child's package, up to the full cost of attendance.
Graduate and Professional (including Vet Med) students may also take out a Federal Direct Graduate and Veterinary Medicine PLUS Loan to pay for their own education.

For more information, visit the Department of Education.

Qualified Borrowing Amounts

  • Parents may borrow up to the amount of the student's cost of education, which Iowa State University refers to as the Cost of Attendance, minus any other financial aid.
  • PLUS Loan funds are generally disbursed in two payments over the course of an academic year. Remaining funds will be distributed to the parent or to the student with the parent's written permission

Requirements

  • The Federal Direct PLUS Loan is subject to credit analysis. In the case of adverse credit, the borrower may borrow the loan with a credit worthy co-signer

Repayment

  • Repayment begins 60 days after the full amount borrowed for a school year has been disbursed
    • Parents whose Federal Direct PLUS Loan is fully disbursed on or after July 1, 2008, have the option of beginning repayment on the PLUS loan either 60 days after the loan is fully disbursed or not until six months after the dependent student on whose behalf the parent borrowed ceases to be enrolled on at least a half-time basis (deferment option). Parents can apply for this deferment when completing the Direct PLUS Loan application online at www.studentloans.gov.
  • A net origination fee of 2.5% is deducted proportionately from each loan disbursement
    • By federal law the total origination fee is 4.0%, but Direct Loans offers a 1.5% rebate
    • If the borrower fails to make 12 on-time monthly payments, a charge for the difference between the 2.5% and 4.0% origination fees will be added to the outstanding balance of the loan
  • The interest rate is fixed at 7.9%
    If the loan was taken prior to July 1, 2006, the interest rate is variable

Renewing, Increasing, or Decreasing

  • To renew or increase the Federal Direct PLUS Loan, the borrower must complete another PLUS Loan application at www.studentloans.gov.
  • If the borrower has adverse credit history, they must complete the Master Promissory Note for Federal PLUS Loans.
  • To decrease the loan amount, please contact the Office of Student Financial Aid at (515) 294-2223

More Information

Please contact Direct Loan Services at 1-800-557-7394 regarding any questions you may have involving the PLUS loan application process at www.studentloans.gov