loans


Undergraduate Federal Parent PLUS Loan Information

SMU knows you may need financial assistance to complete your education. You and your parents must make informed decisions about borrowing money. Loan details and instructions for how to complete a loan application are included.

SMU encourages all students to investigate a lender before making a choice to borrow from them. An SMU student is never required to use only the lenders on our preferred lender lists and will certify a loan with any lender of your choice.

SMU encourages students to borrow loans for what they need and NOT to
borrow loans for what they could spend!

  • Federal Parent PLUS loans are only for parents or legal guardians of undergraduate dependent students
  • Fixed interest rate of 8.5% for loans after 7/1/06
  • Interest accrues on the unpaid balance from the date of disbursement
  • Parents are the borrowers of the Federal Parent PLUS loan—not the student
  • Eligibility is not based on financial need; however, creditworthiness is used for eligibility
  • A FASFA does not need to be filed to secure a Federal Parent PLUS loan; however, SMU encourages families to file the FAFSA
  • An additional unsubsidized Stafford loan is available for students if a Federal Parent PLUS loan is denied by a lender because of adverse credit history
  • A cosigner with good credit history can be used by a parent with adverse credit history to secure a Parent PLUS loan
  • Loans may be subject to origination and Federal Default fees that are deducted from the loan disbursements
  • Disbursements are made electronically to the student’s SMU Tuition Account at the beginning of each term/semester if student is enrolled at least half-time
  • Credit balances created by excess Parent PLUS loans are refunded to the parent
  • Repayment of principal and interest begins 60 days after the loan is fully disbursed during the academic period with up to 10 years to repay
  • Parent PLUS loans first disbursed after July 1, 2008 may choose to defer payments until six months after the date the student ceases to be enrolled at least half time. Borrower is encouraged to pay accruing interest monthly or quarterly, but is can be capitalized quarterly.
  • New regulations allow lenders to consider parents eligible for PLUS loans even if, during the period January 1, 2007, through December 31, 2009, the parents are or were: no more than 180 days delinquent on a mortgage payment on their primary residence, no more than 180 days delinquent on any medical bill payments, no more than 89 days delinquent on the repayment of any other debt.

Borrowing Limits:
The maximum that can be borrowed on behalf of each dependent student is the cost of attendance less any other financial aid for a given academic period. The cost of attendance is determined by SMU and includes tuition, fees, and estimated room, board, travel, books, and personal expenses. The student’s financial aid advisor can provide the cost of attendance figure SMU used as the basis for awarding your student. Generally, the amount a parent is eligible to borrow from the Federal Parent PLUS loan for the academic year is included on the student’s Financial Aid Award Notice they received on Access.SMU. 

Selecting a Lender:
Choosing a lender is an important decision. You can choose any lender you wish. If you have not previously borrowed Federal Parent PLUS loans, we recommend that you borrow from one of the lenders on our website Lender List because they have been screened for providing quality service. If you have an outstanding loan debt with another lender, we suggest you continue borrowing from that same lender.  Master Promissory Note (MPN): It is important to understand the long-term commitment you are making by signing this note. SMU encourages you to assess carefully what you need to borrow on behalf of your student and monitor your debt so you can afford the monthly payments.

Master Promissory Note (MPN)
The Federal Stafford Master Promissory Note is the agreement you sign for all Stafford loans. The MPN only needs to be completed once for multiple years of borrowing with a specific lender. This MPN is valid for up to 10 years from the original date of signature. It is important to understand the long-term commitment you are making by signing this note. SMU encourages you to record all amounts that you borrow so you can continue to borrow wisely. 

Application Instructions:

  • Choose a lender from our recommended Lender List and select the “Apply Now” link or go directly to your lender of choice application website
  • Complete the application directly on their website
    • Include in the application the amount you have determined to borrow along with the dates that correspond to the academic period you wish the loan to be disbursed (only one academic year at a time)
  • Certifying and awarding of the loan will occur when the lender notifies SMU that the loan has been credit approved and the lender is in receipt of a signed Promissory Note
  • Awarding of the appropriate unsubsidized Stafford loan will be made upon notification of a denied Parent PLUS loan.
  • Contact your student’s financial aid advisor if you wish to reduce the amount of the Parent PLUS loan