Federal Direct PLUS Loans

• Loan Details

  Information for 2020-21

  • The borrower is the parent.
  • A co-signer is not required; however, a co‐signer could be used in the event the main borrower’s application is denied.
  • Interest Type: Variable fixed, meaning borrowers would receive a new rate with each new loan, but then that rate would be fixed for the life of the loan.  Interest is capped at 10.5%.
  • Current Interest Rate: 5.30% for 20-21.
  • Fees: 4.236% origination fee (deducted from the total amount borrowed). 4.228% origination fee for loans disbursed after October 1, 2020.
  • Repayment is immediate and begins 30‐60 days after last disbursement is made. Interest‐Only and Deferred payment options may be available; you will need to contact your loan servicer (once assigned) for details. Minimum monthly payment is $50.
  • Loan Term: 10 years.
  • Limits: Up to cost of attendance minus any financial aid received.
  • Required Materials:
    • FAFSA (fafsa.ed.gov)
    • Master Promissory Note (https://studentaid.gov/)
    • Completed application (https://studentaid.gov/)
  • Additional Details:
    • The PLUS Loan is not need‐based. A review of credit‐worthiness is required in order to receive PLUS funds.
    • You will be asked to choose an amount to borrow that is either;
      (1) Specific – you pick an exact number. This the suggested course of action.
      (2) Max Available – you choose to borrow as much as possible. This includes borrowing against unbilled expenses such as books, travel, and personal allowances.
      (3) Unknown – if you do not know how much to borrow, contact our office and we can help you decide what is right for you and your student.
    • The amount that you choose is a NET amount, meaning the actual loan balance will be higher to accommodate the origination fee.

• Application Instructions

  We encourage you to submit your application by August 15, in order for the loan credits to be available toward the payment required for fall term registration. Please note that you cannot apply for a PLUS loan prior to June 1st. 

  If you are applying for financial aid, you should not submit your loan application until you have received a financial aid decision and can determine how much you will need to borrow.

  For New Direct PLUS Borrowers:

  1. Complete a 2020-2021 Free Application for Federal Student Aid (FAFSA).  The federal government requires all PLUS applicants to have a completed FAFSA for the student they are borrowing for on file.  Please use our school code, E00468, to designate Harvard to receive the completed FAFSA.
  2. Create an FSA Account online. The federal government no longer uses the 4 digit FAFSA PIN to validate student or parent identity. In order to complete an application for a PLUS Loan, you will need a FSA username/ID and password. Account creation takes about 5 minutes to complete and is required to be able to log in to the site.
  3. Complete the on-line Master Promissory Note and PLUS Loan Application. In order for us to process your new loan, the borrower information must match exactly the information that was submitted on your original Master Promissory Note. Please note: you must select “Harvard College”, school code G02155, when completing the online PLUS application.

  For Returning PLUS Borrowers:

  1. Complete a 2020-2021 Free Application for Federal Student Aid (FAFSA).  The federal government requires all PLUS applicants to have a completed FAFSA for the student they are borrowing for on file.  Please use our school code, E00468, to designate Harvard to receive the completed FAFSA.
  2. Complete the on-line PLUS Loan Application.  In order for us to process your new loan, the borrower information must match exactly the information that was submitted on your original Master Promissory Note. If your address has changed since the last time you applied, please complete a new Master Promissory Note. Please note: you must select “Harvard College”, school code G02155, when completing the online PLUS application.

  Please note the Federal PLUS Loan program carries a loan origination fee of 4.236% (and 4.228% for loans first disbursed after October 1, 2020) which will be added to the amount you request online. For example: if you request a loan of $10,000, your application will be processed for $10,441, in order to net the proper amount. Please contact our office with any questions.

• What If I'm Denied?

  In the event the borrower is denied the PLUS loan, they will have the option to either;
  (1) appeal the decision, or
  (2) re‐apply with a co‐signer, or
  (3) withdraw their application.

  If you choose to appeal the decision you must first complete PLUS Loan Counseling at https://studentloans.gov. Afterwards, you should be in contact with Direct Lending Services at 1‐800‐848‐0979 to discuss what materials and information might
  be needed to appeal your credit decision. Appeals can take up to (2) weeks to process so make sure to plan accordingly.  If successful, appeal decisions will be sent directly to our office.

  If you choose to reapply with a co-signer you must first complete PLUS Loan Counseling at https://studentloans.gov. You will then need to find a credit‐worthy co‐signer and have them complete both a Master Promissory Note (MPN) and Co‐Endorser addendum, available at https://studentloans.gov.
  PLEASE NOTE: When applying with a co‐signer the amount of your loan changes from a NET amount to a GROSS amount. Your co‐signer will need to adjust the amount of loan they are approving on their addendum if you wish to maintain your original request. If you
  do not know how to do this, please contact our office. A Co‐Endorser addendum is only approved once, meaning incorrect information will have to be discarded and the process will start all over.

  If you choose to withdraw your application for a Federal PLUS Loan, the student will have the option of borrowing an additional $4,000 in Unsubsidized Stafford Loan, assuming they meet the eligibility requirements. This amount increases to $5,000 for seniors.