Federal Direct Parent PLUS Loan
Information Guide & Request Form

The Federal Direct Parent PLUS Loan is a fixed-rate, low interest loan available to parents of dependent students enrolled at least half-time and making Satisfactory Academic Progress towards her/his degree. The PLUS Loan can be used to meet the gap between the student’s cost of attendance at CSU Long Beach and the other types of aid awarded.

Financial need is not an eligibility requirement for the PLUS Loan; approval is based on creditworthiness. However, the credit requirements are less stringent than other credit-based loans.

The lender, or source of funding, for the Direct Parent PLUS Loan is the U.S. Department of Education rather than a bank or other financial institution. Since loans in the Direct Loan program are made, backed, and serviced by the U.S. Department of Education, parents and students have one consistent point of contact for their loans.

Although there are a variety of lenders that offer non-federal, or private education loans, these loans typically have a variable interest rate which can change on a monthly basis. As a result, private loans often carry higher fees and interest rates over the long-term than the Federal Direct PLUS Loan; they may also have less attractive repayment terms. CSU Long Beach requires dependent undergraduate students to file the Free Application for Federal Student Aid (FAFSA) if their parents wish to borrow a PLUS Loan.

Filing the FAFSA ensures that students receive the maximum financial aid for which they are eligible. For financial aid purposes, a student is considered “Dependent” if she/he is under 24, unmarried, and has no legal dependents at the time the FAFSA is submitted (students who are veterans, wards of the court, or fall into other specific categories are listed on the FAFSA are considered Independent and would not be eligible to have a PLUS Loan borrowed on their behalf).

In order to borrow a PLUS Loan, you must be the student’s biological or adoptive parent or the student’s stepparent if the biological or adoptive parent has remarried at the time of application (Legal Guardians or other relatives are not eligible to borrow the PLUS Loan). Only one parent acts as the borrower of the loan.

Eligibility requirements for the PLUS Loan are typically less restrictive than for alternative (or private) education loans. Because the PLUS Loan is a credit-based loan, the Department of Education does perform a review of the parent borrower’s credit history as part of the loan approval process. However, instead of focusing on a parent’s debt-to-income ratio or credit score, the review for the PLUS Loan is focused on the parent borrower’s credit history. This is done to ensure the parent borrower does not have an adverse credit history. Parents who do have an adverse credit history often think that they can’t qualify to borrow a PLUS Loan, and therefore, their student will have to assume the debt. This may not be true, as a parent who has been credit denied has the opportunity to reapply with a credit-worthy endorser (similar to a co-borrower).