The U.S. Department of Education makes Direct PLUS Loans to eligible parents through schools participating in the Direct Loan Program. … A Direct PLUS Loan is commonly referred to as a parent PLUS loan when made to a parent borrower.
Then, do Parent PLUS loans affect your debt to income ratio?
When you apply for a Direct PLUS Loan for your child, the government will check your credit report, but not your income or debt-to-income ratio. In fact, it does not even consider what other debts you have. The only negative thing it looks for is an adverse credit history.
Consequently, do you have to have good credit for a parent PLUS loan?
No minimum credit score is needed to get a parent PLUS loan. Federal loans aren’t like private parent student loans, which use your credit score to determine whether you qualify and what interest rate you’ll receive. But parent PLUS loans do have a credit check, and you won’t qualify if you have adverse credit history.
How do I get a parent PLUS loan?
To be eligible for a Direct PLUS Loan for parents, you must be a biological or adoptive parent (or in some cases a stepparent), not have an adverse credit history, and meet the general eligibility requirements for federal student aid (which the child must meet as well).
How long does it take to get approved for parent PLUS loan?
How long does processing take? Due to the value of PLUS applications at peak times (particularly summer and the start of the Fall term), PLUS loans can take 4 weeks for processing and for the loan to be posted on the student’s financial aid summary.
Is a parent PLUS loan considered a federal loan?
A parent PLUS loan is an unsubsidized federal direct loan. Because they are not subsidized loans, interest accrues while the student is in college.
What disqualifies parent PLUS loans?
An applicant can be disqualified and denied a PLUS loan for credit problems like recent bankruptcies, large debts more than 90 days delinquent, a recent wage garnishment or a tax lien. READ: 4 Things Borrowers Don’t Always Know About Parent PLUS Loans. ] … Consider alternatives to taking on additional debt.
What happens after parent PLUS loan is approved?
You will receive a confirmation email shortly. The school you selected will be notified within the next 24 hours. Though your credit has been approved, all other eligibility requirements must be met before your loan can be awarded. Your school will tell you what loans, if any, you are eligible to receive.
What is the max amount for a parent PLUS loan?
1. You can borrow as much as you need. Unlike other types of federal student loans, Parent PLUS Loans have virtually no limits when it comes to borrowing. You can borrow up to the cost of attendance minus any other financial aid received.
Which parent should apply for parent PLUS loan?
Which of my parents should apply for the Parent PLUS Loan? The parent whose information is listed on the FAFSA will be the one who will apply for the Parent PLUS Loan.
Who can cosign a parent PLUS loan?
Parents, not students, take out the loan
One of the most important things for parents to remember about taking out a Parent PLUS loan is that you — not your child — will be legally responsible for repaying the debt. The student can’t cosign the loan, and you can’t transfer the loan directly to your child.