Parent PLUS Loans

• Parent borrowers may request a deferment, allowing for payments to be deferred while the student is in enrolled at least half-time, as well as for an additional six months after the student leaves school, graduates or drops below half-time enrollment.
• It is important to remember interest accrues on loans during periods when payments are not required to be made. Parent borrowers may choose to allow interest to be added to the loan principal (capitalized) when they have to start making payments or they may choose to pay the accrued interest.
• You may request a deferment during the loan request process or contact the loan servicer directly to request a deferment on your Direct PLUS Loan.

For more information, please visit this helpful guide Direct PLUS Loan Basics for Parents

• A credit check will be performed during the application process. If you have an adverse credit history, you may still receive a parent PLUS loan through one of these two options:
  1. Obtaining an endorser who does not have an adverse credit history. An endorser is someone who agrees to repay the parent PLUS loan if you do not repay it. The endorser cannot be the child on whose behalf you are borrowing.
  2. Documenting to the satisfaction of the U.S. Department of Education that there are extenuating circumstances relating to your adverse credit history.
• With either option 1 or option 2, you also must complete credit counseling for parent PLUS loan borrowers.

No, parents should complete and sign the parent section of the Parent PLUS loan application. Students will need to complete and sign the student section of the Parent PLUS loan application.

• Yes, parents will decide the amount they want to request.
• The maximum Parent PLUS Loan amount that can be borrowed is the cost of attendance minus any other financial assistance the student receives.
  • For example, if the student budget (tuition, fees, books and supplies and room and board) is $20,000 and the student was offered $8,000 in other financial aid/scholarships, the parent could borrow up to $12,000 from the Federal PLUS loan.
• NOTE: Parents will specify when applying for the Parent PLUS loan if they are applying for the fall/spring (meaning the amount will be split. For example, if the parent applies for a fall/spring PLUS loan and requests $10,000 the loan will be split $5000 for fall and $5000 for spring) or for just one term (fall only or spring only).

• Parents will need to reapply for the PLUS loan each academic year.
• If parents applied for a fall only PLUS loan, they will need to submit another application for the spring if they wish to apply.

If the parent's Direct PLUS loan is approved, the Direct Loan Servicing Center electronically disburses funds to Morehead State University. One-half of the total loan, minus fees, is disbursed each semester. The funds are used to pay all outstanding obligations to the University.

No, if the parent does not want to borrow the approved PLUS loan, the parent will simply not sign his/her Master Promissory Note (MPN) and the loan will never be processed.

No, Parent PLUS loan approvals depend on the borrower’s credit history.

Yes, there is a loan fee on all Direct PLUS Loans. The loan fee is a percentage of the loan amount and is proportionately deducted from each loan disbursement. The percentage varies depending on when the loan is first disbursed

• On or after 10/1/19 and before 10/1/20: 4.236%
• On or after 10/1/18 and before 10/1/19: 4.248%
• Loans first distributed before 10/1/18 have different loan fees.

• If you are eligible for a parent PLUS loan, you will be required to sign a Direct PLUS Loan Master Promissory Note (MPN), agreeing to the terms of the loan.
• If you’re taking out parent PLUS loans for more than one child, you’ll need to sign separate Direct PLUS Loan MPNs for the loans you receive for each child.

• After all University charges are paid, any remaining funds are issued to student. The office of Accounting and Financial Services sends funds to the address listed on the student’s account or through direct deposit.
• The student can setup direct deposit on their MyMoreheadState account.

If the parent is not approved, MSU will be notified of the denial, and the student will automatically be awarded an additional unsubsidized loan if they requested that option on the Parent PLUS loan application in the student section.

Parent PLUS loans are loans that the parent may apply for to help cover the student’s expenses for college.

• PLUS Credit Counseling will help students and parents understand the obligations associated with borrowing a PLUS loan and assist them in making careful decisions about taking on student loan debt.
• PLUS Credit Counseling is required if the U.S. Department of Education has informed you that you have an adverse credit history and you have:
  • Obtained an endorser or
  • Documented extenuating circumstances to the satisfaction of the U.S. Department of Education
• PLUS Credit Counseling can be completed voluntarily at any time. If PLUS Credit Counseling is completed voluntarily and you are determined to have an adverse credit history by the U.S. Department of Education within 30 days of PLUS Credit Counseling completion, your PLUS Credit Counseling requirement will be considered to be fulfilled.

For Direct PLUS Loans first disbursed on or after July 1, 2020, and before July 1, 2021, the interest rate is 5.30%. This is a fixed interest rate for the life of the loan.

• To be eligible to borrow PLUS loans as a parent you must:
• Be a U.S. Citizen or National or Permanent Resident/Other Eligible Non-Citizen
  • If you are not a U.S. Citizen or Eligible Non-Citizen, you are NOT eligible to apply for the Direct Parent PLUS loan.
  • However, we can award your student additional Direct Unsubsidized Loan once we certify your status.
  • Please note: If either parent on the FAFSA is a U.S. Citizen or Eligible Non-Citizen, the eligible parent must complete the Direct PLUS Loan application and receive a denial in order to be reviewed for additional Direct Unsubsidized Loan Eligibility.
  • To initiate the process, please contact our office at finaid@moreheadstate.edu or 606-783-2011.
• Be the biological or adoptive parent of the student
• Be the spouse of the student's parent and considered to be a parent in accordance with the instructions on the Free Application for Federal Student Aid (FAFSA) for purposes of reporting income and assets on the FAFSA
• Have made satisfactory arrangements to repay the amount owed after receiving more money than you were eligible to receive from one of the Title IV programs (e.g. Federal Perkins Loan, Federal Pell Grant, a federal student loan)
• Have made satisfactory arrangements to repay the amount owed on any loan you are in default on from one of the Title IV programs (e.g. Federal Perkins Loan, Federal Pell Grant, a federal student loan)
• Have fully repaid to the U.S. Department of Education (ED) or to the loan holder in the case of a Title IV federal student loan, if convicted of, or pled nolo contendere (no contest) or guilty to, a crime involving fraud in obtaining funds under a program authorized under Title IV of the Higher Education Act of 1965, as amended (HEA).

Parent borrowers are legally responsible for repaying the loan to the U.S. Department of Education and loan payments cannot be transferred to the student. Repayment begins when the loan is fully paid out (disbursed) and payments begin 60 days after disbursement. The service lender will notify the borrower when the first payment is due.