The federal government will pay the interest on the loan while the student is enrolled in school as at least a half-time student, and when the student has authorization to defer loan payments. Students must be an undergraduate and meet specific financial criteria.
To qualify to borrow a PLUS loan, a parent must be the student’s birth parent, adoptive parent or stepparent (if stepparent's income was used to calculate student's Expected Family Contribution). The parent applying for the loan is responsible for repaying the loan. PLUS loans are available without regard to financial need but have a credit check requirement.
The student is responsible for the interest that accumulates on an unsubsidized loan while attending school, and during periods when they are authorized. Students are encouraged to make payments on the interest while they are in school if possible. This will decrease interest accrued over time. This loan is available regardless of financial need.
This federal loan program is available through participating schools to provide college financing to students with considerable financial need. Eligibility depends on your financial need and the availability of funds. Your school is your lender.
Federal Loans vs. Private loans
Guide: Federal vs Private: Dept. of Education overview of the differences between the federal and private loan options for students
- Student MUST complete a FAFSA each year of school to continue being eligible for federal aid, including loans
- Federal loans should be used only after grant and scholarship options have been exhausted
- If a student needs a loan, borrow Direct Subsidized Loans first (if eligible) before Direct Unsubsidized Loans.
- Private and alternative loans should be the last resort for financial aid. These often come with higher interest rates than federal loans and less forgiving repayment terms.