Topics: Student Loans
PLUS Loans are federally-funded, fixed-rate college loans available to the parents of dependent undergraduate students. They are also available to graduate students to pay for their own education.
When your financial aid package falls short of your needs, a private student loan may be a competitive alternative to a PLUS Loan.
|Private Student Loans||PLUS Loans|
|Lender||Bank, credit union, financial institution, state agency, college, or university||U.S. Department of Education|
|Interest Rates||Fixed and variable options available||Fixed at 7.6% (first disbursed on or after 7/1/18 and before 7/1/19)|
|Rate Based on Credit Criteria?||Yes||Yes, but debt-to-income or credit score are not considered|
|Cosigner Required?||Yes, unless borrower has a strong credit history||No, but borrower may not have an adverse credit history|
|Loan Fees||Typically 0% to 5%, but varies by lender and borrower||4.264% (on or after October 1, 2017, and before October 1, 2018)|
|Repayment Plans||Vary by lender||Many options available|
|Suspending Repayment||Typically 1 year of forbearance, depending on lender||3 years of deferment and 3 years of forbearance available, if eligibility requirements are met|
|Cancelling Repayment||Very limited options||Some forgiveness and discharge options available|
|Eligible for Public Service Loan Forgiveness||No||Grad PLUS Loans: Yes; Parent PLUS Loans: No|
|Eligible for Income-Based Repayment||No||Grad PLUS Loans: Yes; Parent PLUS Loans: No|