Loans

Need help understanding the different loans that might be available to you? The information below should give you a good start.

Ready to apply? See how you can apply for a loan.

Direct Student Subsidized Loan
What U.S. government pays interest while in school
Amount $3,500–$5,500; based on financial need and grade level
Loan Money Arrives September and January (half of the loan each semester)
Pay Back the Loan 6 months after graduating, or taking less than 6 units
Stay Eligible Take at least 6 units and maintain satisfactory academic progress (SAP)
More Information studentaid.gov and Plain Language Disclosure for Federal Loans (PDF)
Direct Student Unsubsidized Loan
What Student pays interest while in school
Amount $2,000–$7,500; based on Subsidized Loan amount
Additional Amount $4,000–$5,000; if PLUS Loan is denied or independent
Loan Money Arrives September and January (half of the loan each semester)
Pay Back the Loan 6 months after graduating, or taking less than 6 units
Stay Eligible Take at least 6 units and maintain satisfactory academic progress (SAP)
More Information studentaid.gov and Plain Language Disclosure for Federal Loans (PDF)
Direct Parent PLUS Loan
What Parent loan to help pay for dependent student’s college costs
Amount Up to Cost of Attendance minus other aid
If PLUS Loan is Denied Student receives additional Unsubsidized Loan: $4,000–$5,000
Loan Money Arrives September and January (half of the loan each semester)
Pay Back the Loan Early March for most parents (60 days after second disbursement)
To Apply Online at studentloans.gov
Stay Eligible Student takes at least 6 units, and maintain satisfactory academic progress (SAP)
More Information studentaid.gov and Plain Language Disclosure for Federal Loans (PDF)

What is a Parent PLUS Loan?

Parent PLUS Loans are loans for parents of dependent undergraduate students to borrow up to the cost of attendance, minus all other financial aid.

Parent Borrowers should be aware that Parent PLUS loans are subject to credit approval by the Department of Education. For more information and frequently asked question, please visit studentaid.gov.

What is the maximum PLUS Loan Amount?

The maximum PLUS Loan amount a parent can borrow each academic year is calculated by subtracting other financial aid from the cost of attendance.

Example:
Student A is a first-year dependent undergraduate student. Her cost of attendance for Fall and Spring terms is $52,496 and her financial aid (such as grants, scholarships, and student Direct loans) totals $37,399. Her parents would be able to borrow up to $15,097 in a Parent PLUS Loan.

PLUS Loan Eligibility:

  • $52,496 (Cost of Attendance)
  • -$37,399 (Other Financial Aid)
  • $15,097 Max PLUS Loan Amount

How do I apply for a Parent PLUS Loan?

Learn more about the steps to apply for a loan.

When will I receive the funds from the PLUS Loan?

Once the student’s financial aid file is complete, the PLUS Loan usually disburses into the student’s APU account during the first month of the semester (first half of the loan in fall, the second half in spring), or later depending on when documentation is received.

What if I’m denied a PLUS Loan?

Parents have a few options:

  1. Appeal the decision by contacting Direct Loans.1
  2. Apply for the PLUS loan with an endorser (co-signer).1
  3. Have their spouse or the student’s other parent apply

If these options do not work, the student can then take out an additional Direct Unsubsidized Loan (freshmen and sophomores, $4,000; juniors and seniors, $5,000).

Alternative/Private Student Loan

Before applying for a private student loan, we strongly encourage you to first consider applying for federal loans. Federal loans typically offer a better interest rate and repayment/cancellation terms. The terms and conditions of your private loan will vary depending on your private loan lender, but you can find some basic information on private loans below:

Private Loan
What Student loan, borrowed from a private bank
Amount Up to Cost of Attendance minus other aid
Fee Check with lender
Loan Money Arrives September and January (half of the loan each semester)
Interest Rate Check with lender
Pay Back the Loan Check with lender
Stay Eligible Maintain satisfactory academic progress (SAP)
More Information elmselect.com

Footnotes

  1. If the parent borrower was originally denied the PLUS Loan based on adverse credit and was then later approved (or obtained an endorser), the parent must complete PLUS Credit Counseling online. The Parent PLUS Loan will not disburse to the student’s APU account until the credit counseling is completed.

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