Federal Direct Graduate PLUS Loan
- Loan term period
- Interest rate and fee
- How to apply
- What to do when your application is approved
- Understand net vs. gross loan amounts
- What to do if your application is denied
- How to repay or defer payments
To be eligible for the Federal Direct Graduate PLUS Loan, you must:
- Meet Federal and Penn State Financial Aid Eligibility Requirements
- Be an independent student
- Be awarded for your full Federal Direct Stafford Loan eligibility
- Consent to and pass a credit check conducted by the U.S. Department of Education
Your debt-to-income ratio, credit score, and employment status are not taken into consideration; however, adverse credit typically results in a PLUS loan denial. For more information about adverse credit, visit StudentLoans.gov, click on the subheading "Credit Check" then the question "What is Adverse Credit?"
There are four loan term periods—fall/spring, fall only, spring only and summer only. If you plan to attend both fall and spring semesters, we recommend applying for the fall/spring loan period.
If you choose a fall/spring loan period, the amount of the loan will be split equally between the two semesters; so the disbursement of a $10,000 fall/spring loan would be $5,000 for the fall semester and $5,000 for the spring semester.
The loan interest rate is fixed at 7.9 percent for the life of the loan. There is a 4 percent origination fee.
As of July 1, 2012, the 1.5 percent federal on-time repayment incentive, which previously resulted in a net fee of 2.5 percent, will be discontinued.
First, complete the Free Application for Federal Student Aid (FAFSA).
Then, calculate how much you want to borrow and determine the loan period. The total amount you can borrow is equal to your Cost of Attendance minus other Estimated Aid (these figures are listed on your Student Aid Summary on eLion).
Next, calculate the loan fee. Divide the total loan amount by 0.96.
To receive $10,000, request $10,416 ($10,000/0.96 = $10,416)
Then, log in to eLion and fill out the PLUS Request Form. Be sure to choose the loan term period from the drop-down menu before submitting. You will be notified of the results by mail. Results will also be sent to Penn State within seven to ten business days.
If you are a first-time borrower, use your Federal Student Aid PIN (same PIN used for the FAFSA) to log into StudentLoans.gov. Choose "Graduate PLUS" and follow the instructions to:
- Complete your Entrance Counseling
- Sign your Master Promissory Note (MPN)
In most cases, you will only need to complete entrance counseling and sign your MPN once during your college career.
Financial aid made easier!
Listen to our 90 Seconds or Less podcasts on signing the and
If you have technical difficulty signing the MPN, please contact the U.S. Department of Education’s Direct Loan Applicant Services at 800-557-7394. You may request a paper MPN from our office; however, processing may take three to four weeks, more than double the time it takes to process online.
Your loan will appear on your Student Aid Summary and as a credit on your tuition bill once you have signed your MPN and your loan has been approved. The loan amounts will differ on the Student Aid Summary and the Bursar Tuition Bills sections.
The loan amount on the Student Aid Summary is the gross amount, which includes loan origination fees. In contrast, the Bursar Tuition Bills section will reflect the net amount after the loan origination fees have been deducted.
Once you have accepted your loan and completed your registration, funds will automatically disburse to your student account after classes begin. If a credit balance remains after your tuition bill is paid in full, you may receive a refund.
To increase your loan amount, you must complete another PLUS Request Form, but only for the additional amount needed. Another credit check will not be performed if the request is for the same loan term period. To decrease your loan, please .
The U.S. Department of Education will mail you credit appeal and endorser information. You may use an endorser as a co-signer for the loan.
If you are approved with an endorser, you will need to sign a new MPN for each endorsed loan. Contact Direct Loan Applicant Services at 800-557-7394 for more information regarding your denial, appeal, or endorser process.
Repayment begins within 30 to 60 days of the final disbursement for the academic year unless you defer repayment. If you want to continue to defer your loans, you must request a deferment for each new loan by contacting your federal loan servicer. You can obtain the contact information for your federal loan servicer on the National Student Loan Data System (NSLDS).
If your federal loan servicer requests that you verify your enrollment, log into eLion and select "Academic Verification."