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Graduate PLUS Loan FAQs

Learn the ins and outs of graduate PLUS loans.

By + More

Updated 8/9/13: Statistics and information have been updated to reflect the current year.

What is a Graduate PLUS loan?

It's a federally guaranteed loan that can be used to cover the full costs of graduate school, including reasonable living costs.

Who can get Graduate PLUS loans?

Anyone who is a U.S. citizen, enrolled in a graduate program at least half time and has minimally acceptable credit is eligible. Some non-degree programs, such as some teacher certificate courses, do not qualify for PLUS loans. Students must first exhaust Stafford loan eligibility before getting a Grad PLUS loan.

[Learn more about Stafford loans for graduate students.]

How much can I borrow from the Graduate PLUS program?

Each year, you can borrow the full out-of-pocket cost of your graduate study. To calculate the maximum PLUS eligibility, take your program's annual cost of attendance – which includes tuition, fees, books and living costs – and subtract any financial aid such as tuition waivers, grants or Stafford loans.

How much do PLUS loans cost?

Interest rates on PLUS loans are now market-based, so they will fluctuate from year to year. Once the loan is issued, however, the rate is locked in. The PLUS loan interest rate is determined annually, using the interest rate on the 10-year Treasury note on June 1, plus 4.6 percent. Rates for PLUS loans are capped at 10.5 percent.

How do I get a PLUS loan?

Contact your graduate school and fill out a FAFSA.

Does everyone get approved for a Graduate PLUS?

No. The government rejects applicants who have had significant financial trouble – known as "adverse" credit – such as a recent bankruptcy or bills more than 90 days overdue. You can reapply if you can find a cosigner with good credit.

When do I have to start repaying my Graduate PLUS loan?

Technically, repayment starts after you receive the full amount of your loan, but payments are deferred while students are enrolled in school at least half time. That deferral ends six months after a student’s enrollment drops below half-time. No payments are required while a student qualifies for an in-school deferment. But the first monthly payment is due 45 days after the student drops below half-time enrollment.

What happens if I lose my job or get into other financial trouble?

You can call the Department of Education and ask to apply for deferral or forbearance, which allows you to skip some payments. But beware: The interest keeps building up, so you'll owe a lot more when you start repaying again.

[Read more about deferral and forbearance.]

What are the advantages of a Graduate PLUS loan?

PLUS loans have a fixed interest rate, so your payments won't rise if interest rates rise. They also offer free insurance, so the debt will be canceled if the student dies or becomes disabled. PLUS borrowers can also get their payments deferred if they get into financial trouble. PLUS loan holders are also eligible for Public Service Loan Forgiveness if they work at a nonprofit, in government, or at another qualifying organization. After 10 years of loan payments, any outstanding debt is forgiven.

What are the downsides of Graduate PLUS loans?

Unlike credit card debt and mortgages, which can be canceled if you file for bankruptcy, education loans of all types – federal and private – must be paid. Most bankruptcy courts will not cancel them unless your situation is extremely dire.

Trying to fund your education? Get tips and more in the U.S. News Paying for Graduate School center.