Interest rates on PLUS Loans are fixed. The current interest rates for new PLUS Loans in @AYCurrent are @PLIRCurrent% for parents of undergraduate students (Parent PLUS Loans) and for graduate students (Grad PLUS Loans). This rate is subject to change for 2019-2020 for loans first disbursed on or after July 1, 2019.

PLUS Loan Interest Rates

Interest rates on Parent PLUS and Grad PLUS Loans are the same.

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Loan Disbursement and Default Fees

Loan disbursement and default fees are effectively a form of up-front interest. Assuming a 10-year repayment term, a 4% fee is the equivalent of an increase in the interest rate of about seven-eighths to one percentage point. Assuming a 30-year repayment term, a 4% fee is the equivalent of an increase in the interest rate of about one-third to half a percentage point. The relative impact of a fee is greater with a shorter repayment term or if the borrower prepays the loan, since the fee will be amortized over less time. This is why borrowers who plan to pay off a loan early may wish to avoid up-front fees, if possible.

Fees on PLUS Loans

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