The Overview of Direct PLUS Loans for Graduate Students | Found ...

Federal student loans are great financial aid resources for students who really want to attend college and be able to achieve great results in their lives and careers.

Today people are making a conclusion that education is the main turning point for most of us. It influences all aspects of lives including: finance, health, insurance, family, relationships and other.

Generally there are Stafford, Perkins and PLUS loans. They are all included into the federal loans category. However PLUS loans are available in only 2 forms: PLUS loans for graduate and professional students and PLUS loans for parent borrowers who have dependent students and want to help them cover their education.

What Is The Difference?

Before analyzing main features of PLUS loans for graduates it?s necessary to point out the difference between PLUS loans and other two types of federal loans available for students.

Direct Stafford and Federal Perkins loans are generally need-based loans (except Unsubsidized Stafford loans). So, a financial need is a requirement. However all these loans (including unsubsidized Stafford) have the advantage: there is no need to demonstrate high income level and have a good credit score. These factors do not matter.

In the contrast, the situation with PLUS loans is another. According to the eligibility terms, you must not have an adverse credit history in order to qualify. The loans are credit-based and credit check will be done.

The loans are very interesting. Because, from one point of view, they are credit-based as any private loans, but, from the same time, they have advantages of federal loans.

Summing up, you can apply for Perkins and subsidized Stafford loans with no cosigner because financial need is a requirement. But for PLUS loans a credit check will be done. So, having a good credit score is a must.

A cosigner must be credit-worthy ? with high income and good credit record. Credit score plays an important role because a borrower and a cosigner will pass or not credit check.

Eligibility

Federal loans and PLUS loans for graduate students have strong eligibility terms. In general borrowers must meet the main two criteria. If you can?t do that ? your application will be denied.

One of the main eligibility requirements is that a borrower must be U.S. citizen. The second important thing is to be graduate and professional degree student. It?s obvious because this type of federal financial aid is specially created for certain type of lenders. And if a student does not meet this requirement it?s better to not wasting time.

Interest rate

PLUS loans have the fixed rate at 7.9%. Again, they are dealing with creditworthiness like private loans for college students. But the have low rates and very appealing repayment terms. Borrowers have three repayment plans allowing to repay loans in 10-25 years.

Summing up, there are a number of funding ways for students and college loans are the one of them. But if you are a grad and you really think about continuing the growth in the academic sphere, apply for Grad PLUS loans.

More tips about federal education loans including loan servicers (read acs student loan servicing section) can be found at the Student Aid Answer website and discover how does a student loan work.

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