Loans for Graduate and Professional Students
About the Graduate PLUS Loan
The Deficit Reduction Act of 2005 modified the PLUS program (formerly a federal loan for parents of undergraduates) to allow graduate/professional students to borrow PLUS funds, or Graduate PLUS. Graduate PLUS loans have a repayment period of 10 years and you must be enrolled at least half-time (five credits) to receive the loan. Finally, the GradPLUS is a credit history-based loan, so the Financial Aid Office encourages you to pull your free credit report online before you apply. Reviewing your credit report, and resolving any discrepancies, can help you avoid processing and approval delays.
Several key points should be made regarding the Graduate PLUS program:
- This program is for students in graduate and professional level programs only.
- You must file the FAFSA (Free Application for Federal Student Aid) to be eligible.
- You are encouraged to accept all Stafford Loans for which you are eligible before you borrow under the Graduate PLUS program.
This means that some scholarship students will have their costs fully covered with Stafford Loan and may not need to use the Graduate PLUS.
Graduate PLUS Loan Limit
The loan limit for each year is the annual cost of education/budget, as determined by the Financial Aid Office, minus other financial assistance.
Application Process
To initiate an application you must file the FAFSA and log into eFinaid to accept the loan. In addition you must complete a separate Master Promissory Note (MPN) for the Graduate PLUS as instructed on the application, or at www.dlenote.ed.gov.
PLEASE NOTE: First-time GradPLUS borrowers are required to complete online entrance counseling at the Federal Student Aid progams website.
Graduate PLUS repayment
GradPLUS loans are placed in deferment while you are enrolled half-time. In addition GradPLUS loans disbursed after 7/1/2008 have a six-month grace period. Any GradPLUS disbursed prior to this date does not have a grace period and will begin repayment within 60 days of graduation, dropping below half-time attendance or disenrollment.
As with Unsubsidized Stafford Loans and private loans, interest begins to accumulate at the time the first disbursement is made.
Key differences between Graduate PLUS Loans and private (alternative) loans
Graduate PLUS Loans can be consolidated with your Stafford Loans upon graduation to give you a single payment. Private loans cannot be consolidated with federal loans, so this may be a benefit to you.
Furthermore, while many alternative loan programs may have lower initial interest rates than the GradPLUS, MSU College of Law Graduate PLUS loans may be included in the Michigan Students First program, which could result in lower interest charges overall if you meet the repayment conditions.