PLUS Loans are federal, fixed-rate loans available to parents of dependent undergraduate students and to graduate students for their own education expenses. If your financial aid package falls short, private student loans could be an option worth considering as an alternative to a PLUS Loan.
Differences | Private Student Loans | PLUS Loans |
---|---|---|
Lender | Bank, credit union, financial institution, state agency, college, or university | U.S. Department of Education |
FAFSA Required? | No | Yes |
Interest Rates | Fixed and variable options available | Fixed at 9.08% (first disbursed on or after July 1, 2024 through June 30, 2025) |
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 | 4.228% (first disbursed on or after Oct. 1, 2024 through Sept. 30, 2025) |
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 |
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