PLUS Loan for Parents of Undergrad Students

The Federal Parent PLUS Loan Program allows credit worthy parents to borrow money to pay for education expenses for each dependent, undergraduate, student enrolled at least half time in an approved college or university. These loans are available through both the Direct Loan and FFEL programs. Most of the benefits to parent borrowers are identical in the two programs, however some lenders do offer repayment and other savings benefits. For more information, check out the Parent PLUS loan frequently asked questions.

• A Federal Parent PLUS Loan allows parents to borrow the total cost of undergraduate education (including tuition, room and board, supplies, lab expenses, travel) less any other aid.
• These parent loans are non-need based. Unlike federal student loans, PLUS Loans are based on your credit rating, and the rating average that is considered "good" is usually 625 or better. Learn more about credit.
• The interest rate is fixed but adjusted annually by the Department of Education based on the 91-day Treasury Bill rate for the last auction in May of each calendar year. It is currently 8.5%.
• Parent loans require no collateral unlike home equity loans.
• Interest may be tax deductible.

The primary benefit of the Parent Loan is that parents can borrow federally-guaranteed low interest loans to help pay for their child's education.