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Q.: Is Grad PLUS considered a separate loan program from parent PLUS or is PLUS considered one loan program with two types of eligible borrowers?
A.: Per Sections 428B(a)(1) and 428B(a)(1)(A) of the Higher Education Act of 1965, as amended (HEA), "a graduate or professional student or the parents of a dependent student shall be eligible to borrow funds under this section in amounts specified in subsection (b), if — the graduate or professional student or the parents do not have an adverse credit history as determined pursuant to regulations promulgated by the Secretary." This provision does not create a new loan program, but rather allows for a new type of borrower under the existing PLUS Loan Program.
The terms and conditions of PLUS loans made to graduate and professional students are the same as those that apply to PLUS loans made to parents of dependent undergraduates, although there are additional requirements that are applicable only to Grad PLUS loan borrowers. The additional requirements are as follows:
- All graduate or professional student applicants for PLUS loans must complete the Free Application for Federal Student Aid (FAFSA).
- Before applying for a PLUS loan, a graduate or professional student must apply for and the school must determine the student's maximum eligibility for subsidized and unsubsidized Stafford loan funds. However, a graduate or professional student is not required to receive Stafford loan funds as a condition for receiving a PLUS loan, and a school may not require a graduate or professional student to receive Stafford loan funds before the student may apply for a PLUS loan.
Dear Colleague Letters (DCLs) GEN-06-02 and FP-06-05 provide more information regarding the awarding of Grad PLUS loans. To access these DCLs, go to the Information for Financial Aid Professionals (IFAP) website at www.ifap.ed.gov/dpcletters/GEN0602.html and www.ifap.ed.gov/dpcletters/FP0605.html.
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