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Parent Plus Loan

Greetings from Rosemont’s Financial Aid office!   

Your student has received their award letters, you have narrowed your choice down to Rosemont and now you need to figure out how to close any financial gaps between what has been awarded and what will be billed for tuition, fees, and room and board.   

The federal government has a program for direct federal loans beyond what your student is awarded.  When you begin to consider how you will need to close the gap between what is awarded and what is owed, the Parent Plus loan may be the answer you seek. This option can be the smart choice for some families, but like all consumer debt it must be considered sensibly and thoughtfully.  The Parent Plus is awarded to Parents who do not have adverse credit.  If you have been awarded a Parent Plus loan you need to determine if your individual household budget can manage Parent Plus loan payments.  An easy calculation is to assume that for every $10,000 borrowed it will result in a repayment of $120/month.  Multiply that amount by the number of years it will take to get the degree as well as the number of children in the family. 

The credit check for the Parent Plus loan is good for six months but a good rule of thumb is not to apply before May 1st and after you have made your deposit for your child’s school. 

There are no set borrowing limits for Direct PLUS Loans, but parents may not borrow more than the cost of your child’s education minus any other financial aid received, such as a Direct Subsidized Loan or Direct Unsubsidized Loan. The school will determine the actual amount you may borrow.  The interest rate for the Parent Plus loan is 6.31% and is subject to change on July 1, 2017.  

Your loan money will usually be paid out in at least two installments. Your child’s school will generally credit the loan money to your child’s account to pay tuition, fees, and other authorized charges. Any remaining loan funds will be paid to you directly, unless you authorize the school to pay this money to your child.  

Plus loans cannot be transferred to the student and will remain under the parent’s name for the life of the loan.  There are tax advantages to taking a parent plus loan and can be used as a tax deduction. 

If a parent is denied a Parent Plus loan, the student is automatically eligible for additional unsubsidized direct loans in the amount of $4,000 for freshman and sophomore year, and $5,000 for junior and senior year.  The Plus Loan would need to be applied for each year. 

The repayment period for a Direct PLUS Loan begins immediately after you’ve received the last disbursement of the loan, while your child is still in school at least half-time. However, you may be able to defer making payments while your child is enrolled at least half-time, and for an additional six months after your child graduates or drops below half-time enrollment status. This is a personal choice that parents will need to make and will depend on your individual family situation.  

We look forward to making this wonderful educational opportunity for your student a smooth and worry free one. Please remember that you can reach out to the Financial Aid office with any questions, concerns, or general advice by calling us at 610-527-0200 ext. 2221 or by email at finaid@rosemont.edu.  Students and parents can also schedule an appointment with our counselors by visiting: www.RCfinancialaid.appointy.com. 

To apply for a Parent Plus Loan, have your FSA ID available and click the link for Parent Borrowers at studentloans.gov.