There are many loan programs that can assist your parents in meeting their obligation for your college costs.
Because Amherst College participates in the Federal Direct Loan Program, PLUS Loans are borrowed directly from the U.S. Department of Education through the College. Your parents may borrow a parent alternative loan through any program they choose.
The following list represents the lenders from whom parents have borrowed during the past year.
- Federal Direct Parent Loan for Undergraduate Students (PLUS): A federally sponsored program under which parents may borrow as much as the cost of attendance at the College less the amount of any student financial aid and other parent loans. Application for a Federal Direct PLUS loan requires submission of the Free Application for Federal Student Aid (FAFSA - http://www.fafsa.ed.gov/).
To apply for a Federal Direct PLUS loan through the U.S. Department of Education, go to http://studentloans.gov. There is no need test, but a review of credit worthiness is required. You will be required to sign in using your parent FSA ID and password. Once your application has been completed, you will be notified instantly of the credit decision. If your application is approved and you are a first-time borrower for the student named in the application, you will be prompted to complete an electronic Master Promissory Note (eMPN) immediately following your loan application. As of July 1, 2018, the interest rate is 7.595% (round to 7.6%). The federal origination fee is 4.264% for loans disbursed before October 1, 2018; loans disbursed on or after October 1 will have a federal origination fee of 4.248%. The federal origination fee is subtracted from the proceeds of the loan.
Repayment begins no later than 60 days after disbursement of the loan; however, the parent may defer repayment until six months after the dependent student ceases to be enrolled at least half-time. The repayment period can vary between 10 and 25 years, although a monthly minimum repayment of $50 is required.
For more information, contact the Office of Financial Aid, or the US Department of Education at www.ed.gov.