PLUS Vs. Private Loans

Federal Direct Parent PLUS

&

Grad PLUS Loans

Private Student Loan

Borrower

Parent PLUS: Parent

Grad PLUS: Student

Student and cosigner (if required)

Cosigner can be parent, relative or willing sponsor

Eligibility

At least half-time and degree seeking

Full-time, half-time, less than half-time degree, certificate and licensure seeking depending on lender, check with lenders for availability

Past due option may be available depending on lender

Interest Rates

6.31% fixed interest rate

Fixed and/or variable interest rate options available depending on lender, check with lenders for availability

Fees

4% origination fees deducted from loan amount

Fees may or may not apply depending on lender

Credit Requirements

Credit check required

Approval determined by federal criteria and is not based on credit score 

Additional unsubsidized Stafford may be awarded to dependent undergraduate student based on Parent PLUS credit denial

Credit check required

Approval determined by lender criteria based on credit score, credit history and income (if credit-worthy applicant or cosigner required) 

Dependent undergraduate students are likely to need a credit-worthy cosigner

Servicer

US Department of Education contracted servicers

Determined by lender, check with lenders

Repayment Terms

10 year repayment

May request deferment of payment during in-school and 6 month grace period

Typically 15-25 years depending on lender · No payments while in-school

Grace Period

Please see above (Repayment Terms)

6 to 9 months grace period after enrollment ends depending on lender

Loan Consolidation

Can be consolidated with other federal educational loans (i.e., Perkins and Stafford) through the Federal Loan Consolidation Program

Private Loan Consolidation may be available, check with lenders for availability

Loan Forgiveness Options

Loan forgiven in the event of permanent disability or death of student.

Public Loan Service Forgiveness option

Loan may be forgiven in the event of permanent disability or death of student, check with lenders for availability

Borrower Benefits

0.25% interest rate reduction for Electronic Debit Account Repayment

Borrower Benefits offered to reduce interest rates and overall loan costs, check with lenders for availability and types of benefits offered

Cosigner release option, check with lender for availability and eligibility

Repayment Options

Various repayment options available, including IBR, ICR, Graduate, Standard and Extended

Deferment and forbearance options available

Check with the Department of Education for additional details

Standard and interest-only options may be available, check with lender

Forbearance options may be available depending on lender

Annual Loan Limit

Students may borrow up to the cost of education less other aid received

Students may borrow up to the cost of education less other aid received

Aggregate Loan Limit

None

Yes, amount depends on lender

Check with lender