Parent PLUS Loan – Frequently Asked Questions
- How do I know which lender to choose?
- What if I have bad credit?
- Do both parents sign the application for the PLUS loan?
- When does the loan go into repayment?
- Can I suspend the payments while my son/daughter is in school?
- Can I transfer the loan to my son/daughter’s name once they graduate?
- When does interest start accruing on the loan?
- How much should I request to ensure the correct amount is disbursed?
- How do I change the amount of my loan?
- How do I change the disbursement dates?
How do I know which lender to choose?
All FFELP education loans have the same interest rates and fees, however; lenders can reduce the cost of borrowing by offering borrower benefits. Lenders can also set themselves apart based on their quality of service. Here are some good reasons to choose VSAC as your lender:
-
Borrower Benefits: annual rebates; no-fee Stafford loans; interest rate reductions
-
Knowledgeable Staff: comprehensive knowledge of the loan process and repayment of loans; dedicated to assisting you
-
Service: VSAC is your lender and servicer for the life of your loan; online payments; online account status information; combined billing for all of your VSAC loans
Depending on the circumstances, the VSAC PLUS loan could still be an option. Many parents can provide us with clarifying documentation in order to meet the PLUS loan credit criteria. Obtaining a credit-worthy endorser (similar to a cosigner) is another way to qualify for the PLUS loan.
Your dependent student may be eligible for additional federal loan funds if you are denied a PLUS loan due to adverse credit.
Do both parents sign the application for the PLUS loan?
Only one parent signs the application. If a parent does not meet the PLUS loan credit criteria, an endorser may also need to sign for the loan.
When does the loan go into repayment?
The loan enters repayment after it is fully disbursed to the school.
Can I suspend the payments while my son/daughter is in school?
After your loan enters repayment, you may be eligible for temporary payment suspension through a deferment and/or forbearance; you may request a payment suspension while your son or daughter is enrolled in school. Interest continues to accrue during periods of deferment or forbearance.
Can I transfer the loan to my son/daughter’s name once they graduate?
You can not transfer the PLUS loan into someone else’s name.
When does interest start accruing on the loan?
Interest starts accruing as soon as loan funds are disbursed to the school.
How much should I request to ensure the correct amount is disbursed?
A 3% federal origination fee and a 1% federal default fee are deducted from PLUS loan proceeds at disbursement. To ensure the school receives the correct amount; divide the amount needed by the school by .96 and round this number to the nearest whole dollar.
How do I change the amount of my loan?
Contact VSAC to change the loan amount if:
-
VSAC hasn’t asked your school to certify your eligibility
-
your loan has been approved by VSAC, but the funds haven’t been disbursed to the school
Otherwise contact your Financial Aid Office to change the amount.
How do I change the disbursement dates?
Your school’s Financial Aid Office sets the disbursement dates in accordance with federal regulations.
Return to main Parent PLUS page
