Activate Parent Loan for Undergraduate Student
What you need to know about Parent Loans
A Parent Loan is a loan that you, the parent (who may be a natural, adoptive, step, or divorced parent), borrow from the federal government to help pay your student’s educational expenses while he/she attends college. In addition:
Ø Parent Loans are not based on income to debt ratio. Parent Loans are approved for parents who have a good credit rating. Your loan will be reported to credit agencies and become a part of your credit history.
Ø Parent Loans are not deferred, unless the parent is enrolled at least half-time in an eligible school.
Ø You are likely to be offered a similar amount of Parent Loan in future years.
How do I apply for a Parent Loan for Undergraduate Students (PLUS)?
The student must first complete a Free Application for Federal Student Aid (FAFSA) before the parent can apply for a PLUS. Only a parent or step-parent can apply for a PLUS. The non-custodial parent and/or step-parent may also apply for a PLUS. Individuals who are guardians or other relatives (grandparent, aunt, uncle, sibling, etc.) cannot borrow a PLUS on behalf of a student.
The PLUS application is a two-step process. Both steps below must be completed before the loan can be disbursed. These steps can be completed in either order:
STEP
1: Complete a CMU PLUS Application Form (PLUSApp)
A new PLUSApp is required for each new PLUS loan. This form
can be completed online, printed off and submitted to the
Office of Scholarships and Financial Aid. It may be
accessed at the link above or request that we mail the PLUS
Application to you.
STEP
2: Complete a PLUS Master Promissory Note (MPN)
online at
www.dlenote.ed.gov . The parent borrower must have a
federal PIN to complete the MPN online. If you do not have a
federal PIN, you can apply for one at
www.pin.ed.gov. You need to complete only one multi-year
MPN. However a new MPN is necessary if a different
parent/stepparent wishes to borrow on behalf of the student or
if the parent borrower had a previous PLUS Loan that required
an endorser.
Do I have to complete an online MPN?
No, although it is faster to do so. You may wait for the U.S. Department of Education (ED) to send the MPN in the mail. This is done after CMU has processed your Parent Loan Data Form and transmitted the application to ED. You must mail the completed paper master promissory note directly to ED. It cannot be faxed.
How long does PLUS processing take?
Depending on the time of year it can take up to 4 weeks from the time CMU receives the PLUS PDF until ED sends notice of acceptance or rejection. Therefore it is important to begin the application process prior to the beginning of the academic year to ensure timely processing.
When will PLUS funds be available?
Disbursement of the PLUS funds depends on when the loan is approved and a valid MPN has been received by ED. CMU cannot disburse funds until 10 days prior to the first day of classes in a semester. If that date has passed, and the approval process has been completed, CMU will generally disburse the funds within 7 days of approval.
What occurs during PLUS processing?
- After we receive the PDF, CMU confirms the student's eligibility for a PLUS and transmits the application to ED.
- ED performs a credit check after receiving the borrower information from the CMU Plus Data Form.
- ED notifies the parent of acceptance or rejection of the loan.
- When the loan is approved and a valid MPN has been received by ED , funds are sent directly to CMU and applied to the student's account.
- PLUS funds that exceed CMU charges are refunded to the student by the Receivable Accounting Office (989-774-3618).
What happens if the PLUS application is not approved?
There are several options you may wish to consider:
- The parent borrower may re-apply with an approved endorser (co-signer).
- The student may request an additional
unsubsidized Stafford loan. The maximum loan amounts are
based upon the student’s year in school.
- Freshmen and sophomores can borrow a maximum of $ 4,000
- Juniors and seniors can borrow a maximum of $5,000
- Alternative student loans may be available.
- You may wish to explore other options such as a home equity loan.
How do I calculate what my payments will be?
An estimate of the payment may be found using this link to the Federal Student Aid website:
Click here to return to the activate loan page