Direct Parent PLUS Loan for Undergraduate Students

FIT participates in the William D Ford Federal Direct Loan Program. Under the Federal Direct Loan Program, the funds for the Federal Direct Parent Loan for Undergraduate Students (PLUS) come directly from the Federal Department of Education. One of the benefits of this program is a reduced interest rate from 8.5% for FFEL PLUS loans to 7.9% for Federal Direct PLUS loans. Parents, with good credit histories, may borrow up to the cost of attendance (COA) less other financial aid for their dependent undergraduate students who are enrolled in an undergraduate degree-granting program at least half-time. Credit checks are performed by the Department of Education. PLUS loans, which are federally regulated, are usually more beneficial and recommended over private/alternative student loans.

What needs to be in place in order to apply for Direct Parent PLUS Loan:

1. You must be a U.S. citizen or an eligible non-citizen.
2. The student must be admitted into an undergraduate degree program and, for new students, the tuition deposit must be paid.
3. FAFSA (Free Application for Federal Student Aid) must be completed for that school year. You will need a PIN to complete the FAFSA electronically.

How do I apply to receive a Direct Parent PLUS Loan?

1. Complete and submit the online "Request for Federal Direct Parent PLUS Loan and Consent to Obtain Credit Report" (see instructions and link below).
2. Complete the Master Promissory Note (MPN).  NOTE: We will not certify a Parent PLUS loan until we have received a FAFSA and the student's financial aid has been processed.
3. Student must enroll in at least 6 credit hours per term in a degree program to maintain eligibility.
4. You must pass a credit check.

How do I determine the amount I can borrow?

Students can determine the amount for which their parents may be eligible by accessing MyFIT. The student signs on using their FIT ID and password, then clicks on:

• Go to FIT Applicant or Student tab
• Under Financial Aid Resources, click on Check My FIT Financial Aid Application Status
• Click on My Overall Status of Financial Aid
• On the drop down choose Academic Year

The full annual limit that parents can borrow for the PLUS loan is the difference between a student's cost of attendance (COA) and all other financial aid awarded to the student. Parents do not have to apply for the entire amount. You will be billed for direct expenses only (tuition, fees, and FIT housing). Other costs are estimated expenses and will vary. We suggest that you request the loan to cover the full academic year. If you request the PLUS loan for the full year, half of the loan will be disbursed in the fall and the other half will be disbursed in the spring. Repayment and interest will apply to funds only after they are disbursed.

You will not receive the full amount requested due to a loan origination fee of  4% which is charged by the Department of Education. However, there is also a rebate of 1.5%, which means that your loan will only be reduced by 2.5% (4% origination fee minus 1.5% rebate). A borrower retains the rebate by making the first twelve monthly payments on time. If all twelve payments are not made on time, the amount of the rebates will be added back into the loan amount.

To initiate the process, the parent will need to complete online the "Request for Federal Direct Parent PLUS Loan and Consent to Obtain Credit Report." We suggest that the parent with the best credit history apply for the loan. If your PLUS loan is denied, you may add the other parent, or someone else, as a cosigner. You will find the link to the PLUS application below under “The second step....”

The first step in the application process is to create a login and password for the application site:

• the student’s FIT @ number (@12345678)
• the student’s date of birth
• the student’s last name (If the last name is hyphenated [Jean-Philippe], or has an apostrophe [O'Connell], you will need to use the format that is in FIT's student information system or you will receive an error message that the student is not admitted. Ask the student to check the FIT website to determine the system’s format of the last name)
• parent’s email address.

The second step in the application process is to complete the "Request for Federal Direct Parent PLUS Loan and Consent to Obtain Credit Report":

NOTE: Please read through the remaining FAQ’s before clicking on the link to the application. This will help you to better understand the process and your options.

CLICK HERE to create your login and apply for the Direct Parent PLUS Loan.

"Request for Federal Direct Parent PLUS Loan and Consent to Obtain Credit Reports" are available for :

• Applications for Academic Year 2011-2012 

How am I notified about the status of my loan?

You will receive emails: confirming your login request, confirming receipt of the PLUS application, and notifying you that: 1) there is a message about the status of your application on the application website and 2) that you may now do your Master Promissory Note. The student will receive an email and an updated Financial Aid Award letter displaying the amount for which the PLUS loan has been certified.

What happens after I am notified that my loan has been processed by FIT?

We send your certified Direct PLUS Loan to the Department of Education. They perform a credit check. After the credit check is approved, if this is the parent's first Federal Direct PLUS Loan, the parent must complete a Master Promissory Note (MPN). The parent can complete an electronic e-MPN online at www/studentloans.gov. A paper MPN will be sent by the Department of Education, or a paper MPN can be provided by the Financial Aid Department.

NOTE: You will not be able to complete an MPN until your loan request has been processed and received by the Department of Education. PLEASE WAIT 5 BUSINESS DAYS after you receive the email notifying you that your PLUS loan has been processed by FIT before attempting to complete your MPN.

Repayment is at a fixed rate of 7.9% interest starting 60 days after the loan is disbursed with a repayment term of 10 years. Repayment can be deferred upon request.

What if I am denied a PLUS loan?

If your PLUS loan is denied, you may add your spouse, or someone else, as a cosigner.

If you do not have a cosigner, students of parents who are denied the PLUS Loan may apply for an additional Federal Direct Stafford Unsubsidized loan. The student may apply for the additional Federal Direct Stafford Unsubsidized Loan of $4,000 as a freshman or sophomore, or $5,000 as a junior or senior for the academic year. A Direct Stafford Loan Request for the additional Federal Direct Stafford Unsubsidized loan may be downloaded or requested from the Financial Aid Office.

If you already applied for a PLUS loan through a bank for the appropriate academic year and were denied, AND you do not want to apply for the Direct PLUS loan, proof of denial must be submitted to the Financial Aid Office before this process can be initiated.

Where do the PLUS loan funds get sent?

Federal Direct PLUS funds are sent directly to the school. The parent may request that funds in excess of what is owed to FIT be given to the student or returned to the parent when completing the online application.

Who do I contact with questions about my Direct Federal PLUS loan or deferment?

For questions about your Direct Federal PLUS loan and deferment, contact Direct Loan Servicing at:
(800) 848-0979.