Federal Parent PLUS Loan: This loan program is available only to the parents of dependent students pursuing an undergraduate degree. Parent PLUS loans are available through the Federal Direct Loan Program. Direct Parent PLUS loan funds are disbursed directly to the school from the Federal Government and like any loan, must be repaid. Loans with a first disbursement on or after July 1, 2006, have a fixed interest rate of 7.9%. Loans made prior to that date have a variable interest rate that may change each year on July 1, but will never be more than 9%. The Parent PLUS Loan Program is available to parents with good credit histories who wish to borrow for a dependent student enrolled at least half time. The annual loan limit is the estimated cost of education minus any financial aid received by the student (i.e., grants, loans, scholarships, work, etc.). All fees that are required to be withheld from the loan disbursement will be disclosed on the Notice of Guarantee and Disclosure Statement. Repayment of the Parent PLUS loan begins within 60 days of the loan period's final disbursement on the loan (for example, after the spring semester disbursement for a fall/spring loan). Parents can also ask to defer payments on the principle until after the student graduates or is no longer enrolled at least 1/2 time; however, they must still pay the accrued interest. Instructions for repayment are included with the application. Federal Regulations now require that the student for whom a Parent PLUS Loan is borrowed must have a valid FAFSA recod on file in the SDSM&T Financial Aid Office. In the case of a student with divorced parents, whose parental information used on the FAFSA does not dictate which parent can borrow a Parent PLUS Loan; the fact that there is a valid FAFSA record for the student dictates if a Parent PLUS Loan can be processed on behalf of the student.
