Parents and PLUS Loans: 5 Tremendous Benefits That Help Parents Assist Their Child In Their Quest For Higher Education
PLUS loans are quite beneficial to parents who were unable to save any money or a lot of money for their child’s college education while their child was growing up. However, there is much to learn about these loans including how it works, who is qualified to get them and what kinds of terms are attached to the loan. Read more to find out these very things.
If you’re a parent, chances are you never did get around to saving money for your child’s college years. Don’t worry; there are millions of parents in the same boat as you. When you live paycheck to paycheck, it can be difficult saving money up for a child’s education. This is where the Parent Loan for Undergraduate Students (PLUS) comes in. PLUS loans can make a huge impact and dent on how much you need to pay for your child’s education.
You already know that your child is being constantly being bombarded about how they’re going to pay for college. You also know that you want to help your child out. With this loan, you’ll be able to do this for them.
What This Loan Does For You and Your Child
This loan is your means to help your child fund their education without breaking your financial bank. As with every federal loan, this is a guaranteed loan that will offer you a very low interest rate. Now, you can borrow as much money as you need to so long as it’s equal to the amount that’s required to pay the college tuition, get books and other miscellaneous items. Of course, other financial aid is taken into consideration.
PLUS Loans: Are You Eligible To Receive Financial Help
Before you are considered for this college loan, you must meet certain eligibility requirements. They include:
1- Fill out the FAFSA form. If you want to be considered for any kind of financial aid, you need to submit this form by March 2. If you want any chance for federal aid, think of this form as the “end all, be all”. If you don’t do this step, you won’t be eligible for the PLUS Loan.
2 – You should also have decent credit. Good credit is recommended if you want to get the PLUS loan. Bad credit can knock you out of any chance of getting qualified. If you have a bankruptcy or have been late on any kind of payment for more than 90 days, you’re liable not to be qualified for PLUS loans. This doesn’t mean you need perfect credit either. Always pay your bills on time and you should be good to go for the loan (as long as you meet the other requirements).
3 – Your child must be enrolled at a college for least six hours and maintain the enrollment their entire college career.
4 – The child must go to a college/university that accepts this type of loan program. While the majority of universities/colleges do participate in the PLUS loan program, not all of them will. With that in mind, it is always best to check with your child’s school of choice before you rely on PLUS Loans.
5 – You must be an American citizen or a permanent resident who can qualify for the federal PLUS loan.
What Kinds Of Benefits Are There With The PLUS Loan
Besides getting the low interest rate and flexible payment options, there are several other benefits you’ll find with this type of loan.
- First, you don’t need collateral.
- Second, your interest rate will be fixed (generally around 8.5 percent).
- Third, you can borrow the entire educational amount.
- Fourth, repayment doesn’t begin until after the child is out of college even though these are unsubsidized loans.
- Fifth, your child doesn’t have to be burden with paying back a loan right after graduating or leaving college.
Federal PLUS Loans are a great way to pay for your child’s college. There’s no need to take a mortgage out on the house or turning to a private lender to help you. Save yourself some money by going with the loan that has the low interest rates and little to no fees. Don’t deal with a bank; deal with the government. College isn’t out of reach for your child because you didn’t save up. With this type of loan, college is right at their fingertips.
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