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Federal Direct PLUS Loan for Graduate/Professional Students Federal Direct Graduate PLUS Loan applications will be available April 16, 2012 for the 2012-2013 academic year at www.studentloans.gov. The Budget Control Act (BCA) of 2011 (Pub. L. 112-25) was signed into law on August 2, 2011. This Act makes changes to the William D. Ford Direct Loan (Direct Loan) Program. Effective July 1, 2012:the up-front interest rebate that has been provided to Direct Loan borrowers at the time of their loan disbursement will no longer be offered on any Direct Loan Program loan with a first disbursement date that is on or after July 1, 2012. The Federal Parent Loan for Undergraduate Students (PLUS) for Graduate/Professional Students (Graduate PLUS) is a low-interest federally insured loan to help pay college costs. The loan can be used to cover any educational expenses not covered by other forms of financial aid. Under the Federal Direct PLUS loan program students may borrow up to the full cost of the student's education minus other financial aid received. Eligibility for a Graduate PLUS: To be eligible, borrowers are required to complete the Free Application for Federal Student Aid (FAFSA), the student must be a U.S. citizen or eligible noncitizen, must not be in default on any federal education loans or owe an overpayment on a federal education grant, the student must be enrolled and accepted for enrollment in a degree program on at least a half-time basis (6 semester hours) as an graduate student and the student borrower must not have an adverse credit history (a credit check will be performed). If the student borrower does not pass the credit check, the borrower may still receive a loan if someone (such as a relative or friend who is able to pass the credit check) agrees to endorse the loan. The endorser promises to repay the loan if the borrower fails to do so, and borrowers must have borrowed the maximum eligibility of the Federal Direct Unsubsidized Loans. Borrowing Limits The maximum a Graduate student may borrow per academic year for a Graduate PLUS is equal to the cost of attendance minus other financial aid (including Federal Direct Subsidized, Unsubsidized or a Private loan which are eligible). There is no aggregate maximum loan limit for the Graduate PLUS Loan. Applying for a Graduate PLUS (FAFSA Required): Step 1:New Students: Graduate Students applying for a Federal Direct Graduate PLUS loan must complete an Entrance Counseling at www.studentloans.gov if one was not completed prior during the completion of the Federal Direct Unsubsidized Loan process. If the student has completed the Entrance Counseling, then proceed to step 2. Step 2: New and Returning Students: Sign your award letter and return it to the Office of Financial Aid to confirm the amount of Graduate PLUS Loan for processing. Step 3:New and Returning Students: Complete the Direct PLUS Loan application at www.studentloans.gov. Once on the site,"Sign In" under the "Manage My Direct Loan" located on the left side of the page. You will need your social security number, date of birth and your Federal Student Aid PIN to sign in. To complete the Graduate Parent PLUS Loan application, select the link titled "Request a Direct PLUS Loan" and then select the link for the "Graduate PLUS". The Department of Education will automatically notify Methodist University of the loan decision. Step 4: New and Returning Students: Complete the Federal Direct Parent PLUS Master Promissory Note (MPN) at www.studentloans.gov. Once on the site, "Sign In" under the "Manage My Direct Loan" located on the left side of the page. You will need your social security number, date of birth and your Federal Student Aid PIN to sign in. To complete the MPN, select the link titled "Complete Master Promissory Note" and then select the link for the "Graduate PLUS". The Department of Education will automatically notify Methodist University of the loan decision. If the borrower requests a paper copy of the MPN be sent for completion, there are more steps involved before the Direct Loan can be approved and disbursed, possibly causing delays in receiving loan funds. Please note: When the loan has been processed, you will receive an updated award letter from MU listing the loan as PROCESSED. Once the loan is processed/booked, the loan is assigned a Loan Servicer on behalf of the Department of Education. For a complete listing of Loan Servicers, please visit www.studentloans.gov and choose Loan Serviciers at the bottom right.
Graduate Students Deferring the Federal Graduate PLUS: Students must contact the Department of Education Applicant Services at 1-800-557-7394 to ensure deferment status because student borrowers may need to submit an In-School Deferment Request form to the Direct Loan Servicing Center or repayment will begin immediately Direct Loan Origination Fees The Graduate PLUS Loan, for the 2011-2012 academic year) is a fixed-rate loan with a 7.9% interest rate. Interest begins accruing from the time of full disbursement. A 2.5% origination fee (4% origination fee - 1.5% up-front rebate = 2.5% origination fee) will be deducted from each disbursement. Effective July 1, 2012:the up-front interest rebate that has been provided to Direct Loan borrowers at the time of their loan disbursement will no longer be offered on any Direct Loan Program loan with a first disbursement date that is on or after July 1, 2012. The Graduate PLUS Loan, for the 2012-2013 academic year) is a fixed-rate loan with a 7.9% interest rate. Interest begins accruing from the time of full disbursement. A 4.0% origination fee will be deducted from each disbursement. Loan Disbursement The Graduate PLUS Loan will be issued in two equal amounts, one in the Fall and one in the Spring semester of the academic year. Repayment terms Repayment begins within 60 days after the date of the final disbursement. Repayment begins immediately if at any point the student is not enrolled at least half time. Students must contact the Department of Education Applicant Services at 1-800-557-7394 to ensure deferment status because student borrowers may need to submit an In-School Deferment Request form to the Direct Loan Servicing Center or repayment will begin immediately Loan Cancellation/ Reinstatement A student or parent borrower may cancel or reduce a loan anytime before a loan has disbursed to Methodist University. If the loan has already been disbursed and credited to the student’s account in the Business Office, the borrower may cancel a loan within 30 days from the date it disbursed and credited to the student’s Business Office account. A student may reinstate a Federal Direct subsidized (sub) and unsubsidized (unsub) loan at any time prior to the end of the student’s current academic year enrollment. The Federal Parent PLUS for Parents/Graduate students and Alternative Loans MAY NOT be reinstated once reduced or cancelled. Instead, the borrower must reapply online. To reinstate,reduce, or cancel a loan, the borrower must complete the Loan Revision Form. Important Notice: Canceling any loan disbursement could result in a balance to be due on the student's account in the Business Office which the student will be responsible for paying. Repayment after the designated time period Borrowers cannot cancel a loan disbursement if the designated time period described above has already passed. Instead, the borrower can repay the loan disbursement directly by contacting the loan holder which can be found by accessing www.nslds.ed.gov or the Department of Education at www.myedaccount.com. The borrower will be responsible for any interest that may have accrued and/or any loan fees..
Enrolled for less than 3 (Graduate Level) Semester Hours, Withdrawing, or Graduating From MU: Loan Exit Counseling Federal regulations require students who have borrowed a Federal Direct Loan and are graduating, leaving school, or dropping below half-time enrollment to complete an Exit Counseling. During the Exit Counseling, the student borrower will review rights and responsibilities as a student borrower, important information about repaying student loans, consolidation, repayment options, discharge and forgiveness as well as useful information to help manage student loans during repayment. Students may complete the Exit Counseling at the National Student Loan Database (NSLDS) site. NSLDS is a secure central database that stores information on all loans and grants processed though the Department of Education’s federal student aid program. When completing the Exit Interview, the student must provide a permanent address, phone number, employer (if working) and three (3) different references with complete names, addresses and phone numbers. One reference can be a relative. The other two cannot be relatives. This site is created to collect information from schools and lenders so that aid can be more efficiently processed. It is updated every 30-60 days by the schools and the lender(s), so recent disbursements may not show immediately.
National Student Loan Database Borrowers can review Loan (FFELP or Direct), Perkins, and Federal Grant history through secure login to the National Student Loan Database at www.nslds.ed.gov. This site is created to collect information from schools and lenders so that aid can be more efficiently processed. It is a secure site, and only authorized personnel can log on. It is updated every 30-60 days by the schools and lenders, so recent disbursements may not show immediately. Ombudsman If a borrower disputes the terms of the loan in writing and the holder of the loan is unable to resolve the dispute, a borrower may seek the assistance of The Federal Student Aid Ombudsman of the Department of Education. The Federal Student Aid Ombudsman will review and attempt to informally resolve dispute and may be reached at 1-877-557-2575 or www.ombudsman.ed.gov. Loan Consolidation A Direct Consolidation Loan Program is available that allows a borrower to consolidate (combine) one or more of the eligible federal education loans into one loan. For more details and information, go to www.loanconsolidation.ed.gov.
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