The Federal Direct Parent PLUS loan is a credit-based loan that the parent(s) of dependent undergraduate students may borrow to help pay educational expenses. The parent borrower may borrow up to the total estimated cost of attendance minus any other financial aid received.
UMBC includes the Parent PLUS loan as part of eligible students’ initial financial aid offers. The amount indicated represents the maximum amount of Parent PLUS loan funding for which the student is eligible. The Parent PLUS loan offer is only presented as a possible option—parents must confirm their eligibility by completing a separate Parent PLUS application. Any additional financial aid received after a Parent PLUS loan has been approved for the maximum amount may result in the adjustment of the Parent PLUS loan or other financial aid to comply with federal regulations.
The Parent PLUS loan interest rate is established annually and is determined by federal law. Interest begins to accrue when the loan funds are sent to the university and continues to accrue until the loan is paid in full. An origination fee will be deducted before the loan proceeds are sent to UMBC. The origination fee is a processing fee assessed by the Department of Education.
Please visit our Cost Calculator tool to assist you with determining the amount of Parent PLUS loan funding you may want to borrow. The loan period defines the semester(s) for which you are borrowing. For example, if your student is planning to enroll for both the fall and spring semesters, and you would like to borrow a loan to assist in paying for each semester, you should choose the fall/spring loan period and request a Parent PLUS loan amount that will cover their estimated out-of-pocket expenses for each semester. You may also contact your Financial Aid Counselor for assistance.
Eligibility Requirements
- The undergraduate student must be defined as “dependent” as determined by the FAFSA.
- The borrower must be the biological, step- (if included on the FAFSA) or adoptive parent of the student.
- The borrower must meet the same citizenship criteria as the student for financial aid eligibility.
- The borrower must not have an adverse credit history. If you have an adverse credit history, you may pursue an appeal with the Department of Education, or submit an application with an endorser. (See “If Denied” below).
- The student must be meeting Satisfactory Academic Progress (SAP) standards and must be enrolled in at least six credits each semester they wish to receive Parent PLUS loan funding.
- The student must be working toward a degree or approved certificate at UMBC.
- A valid, current year FAFSA must be completed, even if the Parent PLUS loan is the only financial aid you and the student wish to pursue.
Application Process
Complete all step(s) in the Parent PLUS loan process to apply for the loan. Funds cannot be disbursed if any step is not completed. Please note: if you are borrowing a Parent PLUS loan for more than one student, you must complete a separate application for each student.
The US Department of Education will perform a credit check to determine your eligibility for the Federal Direct Parent PLUS loan. The credit decision will be displayed immediately after the application is completed. The Department will inform our office about the outcome of the credit decision.
Please be advised that credit checks are valid for 180 days. Applying for a Parent PLUS loan more than 180 days before the start of the term for which you are borrowing may require you to undergo a subsequent credit check closer to the beginning of that term.
If Approved –
- Step 2: Complete a Parent PLUS Loan Master Promissory Note (MPN) if you do not already have an active MPN on file and only if your credit check was approved. Please note: if you are borrowing a Parent PLUS loan for more than one student, you must complete a separate MPN for each student. UMBC will process your PLUS loan within the time frame specified on our website. Parent PLUS loans will show as ‘offered’ until the loan is processed by the student’s financial aid counselor.
If Denied –
- You can select the option to pursue an appeal by documenting any extenuating circumstances related to your adverse credit history. Following this selection, you will receive an email confirming your intention. You should then contact the Federal Student Loan Support Center at 1-800-557-7394 for additional instructions on how to proceed, including how to complete the additional credit counseling requirement online. If the appeal is approved, you or the student must contact your Financial Aid Counselor. Once UMBC processes the loan, the student will receive a confirmation email via their myUMBC account.
- You can select the option to pursue an endorser who does not have an adverse credit history. An endorser agrees to repay the loan if you do not repay it. Following this selection, you will receive an email confirming your intention. You should then contact the Federal Student Loan Support Center at 1-800-557-7394 for additional instructions on how to proceed, including how to complete the additional credit counseling requirement online. If the endorser is approved, you or the student must contact your Financial Aid Counselor. Once UMBC processes the loan, the student will receive a confirmation email via their myUMBC account.
- IMPORTANT: For Parent PLUS loans, if the Department of Education determines that you have an adverse credit history and you obtain an endorser, you may receive only one loan under the MPN that you sign. If you later want to receive another Parent PLUS loan, you must sign a new MPN. If you sign a MPN and receive a Parent PLUS loan without an endorser, but are later determined to have an adverse credit history and obtain an endorser for a future Parent PLUS loan, you will need to sign a new MPN for that loan.
- You can decide that you no longer wish to pursue a Parent PLUS loan. In this case, the student can apply for additional Unsubsidized Federal Direct loan funds. The request for additional Unsubsidized Federal Direct loan funds will be reviewed and processed within the time frame specified on our website for the maximum amount the student is eligible to receive based upon their grade level. Once the loan has been processed, the student will receive a confirmation email via their myUMBC account. The student must then accept the additional loan via their myUMBC account.
- You may also wish to apply for additional loan funding through an Alternative (Private) Loan or seek out additional scholarship opportunities using UMBC’s Scholarship Retriever.
Repayment of a Parent PLUS Loan
Repayment begins 60 days after the loan is fully disbursed. The borrower may request a deferment while the student is enrolled at least half-time, and for an additional six months after the student graduates, leaves school or drops below half-time enrollment. During a deferment, you do not have to make any payments. Please contact your loan servicer for more information and to request a deferment. You can find out more about your loan history and loan servicer through “My Aid” on studentaid.gov.
Reduce or Cancel a Parent PLUS Loan
The borrower should complete a Federal Direct Parent PLUS Adjustment Form to reduce or cancel a Parent PLUS loan. To avoid complication with the return of funds, we recommend that you submit the form to our office for processing well before the funds disburse to the student’s account. If the loan has already disbursed, you must submit the form no later than 14 days after receipt of the disbursement notification. If you wish to reduce or cancel a Parent PLUS loan more than 14 days after receipt of the disbursement notification, you must contact your loan servicer directly. You can find out more about your loan history and loan servicer through “My Aid” on studentaid.gov.
Increase Parent PLUS Loan
The borrower should complete an increase request at studentaid.gov.
Decline the Parent PLUS Loan offer
Students and parents who choose to decline the PLUS Loan offer may decline the loan in myUMBC. Additionally, if no application is submitted, the PLUS Loan will continue to remain offered, and will not apply to the student’s billing account.
Federal Direct Student Loan Disclosure Statements
Students receiving any type of federal direct loan will receive a Disclosure Statement from the Federal Loan Origination Center for each new loan. The disclosure statement will provide comprehensive information about the type(s) of loan(s), loan amounts, the loan period, and anticipated disbursement dates. You should save every Disclosure Statement your receive for future reference, and can also access them online at any time by logging in to studentaid.gov with your FSA ID.