Federal Direct Parent PLUS Loan

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 on how to complete a loan application are included.

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

The Federal Direct Parent PLUS Loan is a credit-based educational loan available to parents or legal guardians of dependent undergraduate students enrolled at least half time in a degree seeking program. It is a non-need based loan with the benefit of having a fixed interest rate. PLUS Loans are available regardless of income or assets, and no collateral is required. While the parent borrower does not have to prove financial need, a credit check is required.


  • 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
  • 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
  • An endorser with good credit history can be used by a parent with adverse credit history to secure a Parent PLUS loan
  • 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 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.

Terms & Conditions

  • Fixed interest rate of 6.28% for loans
  • Interest accrues on the unpaid balance from the date of disbursement
  • Loan Fees - The PLUS loan has a 4.228% origination fee
    • 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.

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 Direct Parent PLUS loan for the academic year is included on the student's Financial Aid Award Notice they received on my.SMU.

Application Instructions

  1. Log on to the U.S. Department of Education's Direct Loan website to complete the Direct PLUS Loan Request (including credit check.)
  2. The Direct PLUS Loan Request record will automatically be sent to the University.
  3. You (the parent borrower) will receive the results of the credit check immediately. Depending on the results of the credit check, you will be provided information about the next steps you need to take.
  4. The Direct PLUS Loan cannot be awarded until all the steps have been completed.

What if my PLUS application is denied?

As the Federal PLUS loan is a credit-based form of student aid, applications are occasionally denied due to adverse credit history. Fortunately, the Department of Education provides additional paths to PLUS approval. For more detailed information on your options and the requirements you must meet to be eligible, please visit https://studentaid.ed.gov/sa/sites/default/files/plus-adverse-credit.pdf