PARENT LOAN FOR UNDERGRADUATE STUDENTS
Per the Federal Department of Education: During the 2009/2010 and 2010/2011 award years, Parent PLUS loans under the Federal Family Education Loan program may be made by any eligible lender to parents of students attending eligible educational institutions in any State. Please find below a partial list of lenders who participate in this program.
This loan is available to parents with good credit history. The interest rate is fixed at 8.5%. Interest is charged from the first disbursement date and repayment on both interest and principal begins within 60 days after the final loan disbursement for the academic year.
INSTRUCTIONS FOR APPLYING FOR PARENT PLUS LOAN:
Please Note: The student's accepted award letter does not initiate the PLUS loan. The parent must complete the following steps:
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Review the student's award letter and determine how much you may need to borrow in a PLUS loan.
Helpful Hint: Please refer to the COST WORKSHEET form for assistance in determining the amount that you may need to borrow. The amount borrowed will be limited by other aid your student receives and his Cost of Attendance; the financial aid office will certify a PLUS loan for maximum eligibility. -
You may make a lender selection and request a credit check online or by calling one of the following lenders; or by contacting a lender of your choice.
| Lender | Borrower Benefits | Servicer |
|
Commerce Bank |
.25% interest rate reduction with auto-debit payments Personalized customer service, a live person answers the phone when you call |
MOHELA |
|
Citibank |
Automatic 0.5% interest rate reduction at repayment Additional 0.25% interest rate reduction for auto-debit In-school forbearance option allows you to chose to defer principal and interest for up to 48 months while your child is in school |
Citibank |
|
.25% interest rate reduction with auto-debit payments as long as the payment is successfully deducted from borrower's back account 24x7 online account management with Manage Your Loans www.manageyourloans.com Immediate online credit pre-approval and application Free Credit Counseling |
SallieMae | |
|
Wachovia Bank |
.25% interest rate reduction with auto-debit payments |
Wachovia |
Last updated 7/16/09. Borrower benefit programs may be modified or discontinued at any time without notice.
The Missouri State Office of Student Financial Aid will be notified of your credit approval or denial.
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If the Credit check is approved, the lender will notify the borrower how to complete the application process. The Missouri State Office of Student Financial Aid will be notified by the lender when the completed application has been received and the loan will be certified.
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If your credit check is not approved, the Missouri State Office of Student Financial Aid will notify the student of additional unsubsidized loan eligibility.
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Complete the Request for Direct Deposit of Financial Aid Refunds Form if you expect to receive loan funds in excess of university charges.
LOAN FEES
An "origination fee" is charged for Stafford Loans per the regulations governing the loan programs. The fee may not exceed 3% of the principal amount of the loan. The fee is deducted proportionately from each payment before the loan funds are disbursed to the school by the lender. The fee is paid to the Federal government to defray the cost of the loan programs.
Thus, if a lender deducts the 3% origination fee from a $2,000 Stafford Loan that is to be paid in two installments, the student will receive payments of $970 and $970. (However, the student will be responsible for the full value of the loan, $2,000.) A lender may choose to pay all or part of the origination fee on behalf of their students.
The guarantor is also authorized to collect an insurance fee (not to exceed 1% of the loan). If the guarantor charges an insurance fee for its Stafford and PLUS loans, the lender may pass on the charge to the borrower.
For PLUS loans the origination fee is always 3% and may not be reduced by the lender. The lender may also charge an insurance fee on Stafford and PLUS loans to defray the insurance fee charged by the guarantor (the fee is limited to 1%). In most cases, the loan will be disbursed in at least two installments, and no installment will be greater than half the loan amount. The funds will first be applied to tuition, fees, room and board, and other school charges. If any loan funds remain, the parents will receive the balance.