A Federal Stafford Loan is a low-interest student loan funded by the federal government through the Federal Direct Lending program. This is the largest federal financial aid program, and is made up of both Subsidized and Unsubsidized loan components. To apply, the first step is to complete the FAFSA. Your maximum loan amount depends on your FAFSA dependency status, your grade level (the cumulative number of credit hours you've earned) for the specific loan period for which you're borrowing, and the total amount of scholarship, grant, and other assistance you're receiving for the loan period. A credit check is not required for a student to be approved for Federal Stafford Loan Funds.
Subsidized Stafford Loan aid is awarded in accordance with your calculated financial need. No interest is charged, no repayment of principal or interest is required, and no interest accrues during the time you're enrolled at least half-time. You’re required to begin repayment of your Subsidized Stafford Loan six months after graduating or dropping below half-time enrollment status.
Unsubsidized Stafford Loan aid may be offered to you regardless of your financial need, although the FAFSA must still be completed and submitted. No repayment of the loan principal is required while you're enrolled at least half-time. However, interest starts accruing once the loan is disbursed. The interest may be allowed to accrue and then be added to the loan principal (this is referred to as capitalization). However, many students wisely elect to pay the accrued interest on a quarterly basis in order to eliminate or reduce the effect of compounding.
Detailed information about the Federal Stafford Loan program, such as Loan Origination Fees, Interest Rates, and Maximum Annual Stafford Loan Amounts is available at Federal Student Aid.
A Federal Parent PLUS is a loan funded by the federal government and is available only to biological or adoptive parents of undergraduate FAFSA applicants who are classified as dependent and who are enrolled at least half-time. Some general guidance and information is listed below; please visit Federal Student Aid for additional information or Student Loans to apply for the Parent PLUS Loan.
Interest Rate and Fees
Detailed information about the Federal Parent PLUS Loan program, such as Loan Origination Fees and Interest Rates is available at Federal Student Aid.
Interest is charged on a PLUS Loan from the date of the first disbursement of the loan proceeds for a specific loan period until the loan is paid in full.
Interest rate cap for military members: If a parent qualifies under the Service Members Civil Relief Act, the interest rate on loans obtained before entering military service may be capped at 6% during the parent's military service. Parents must contact their loan servicer to request this benefit.
The University of Central Missouri’s Office of Student Financial Services always recommends borrowing only what you need as loans accrue interest. When determining the amount that you may need to borrow, students and their families should:
1. Determine what your actual tuition, room, board and book costs will be for the
2. Create a budget for all of the other expenses that may be incurred while attending school (supplies, computer, transportation, toiletries, fun money, etc).
Once you have determined what your actual costs will be, then you should review what funding you have available to help you cover your costs like grants, scholarships, and student loans, etc. If a student’s eligible financial aid does not cover all of their budgeted expenses, then have a discussion regarding what amount can be afforded to pay out-of-pocket for the year. If the student’s eligible financial aid and the families out-of-pocket funds are not enough to cover the budgeted expenses, that difference may be the amount that you borrow for the PLUS loan up to our Cost of Attendance.
Repayment (principal and interest) begins 60 days after the final disbursement of the loan funds for the loan period. Parents may elect on the PLUS application to defer payments while the student on whose behalf the parent borrowed the loan is enrolled on at least a half-time basis, and for an additional six months after the student ceases to be enrolled at least half-time. Please keep in mind that interest will continue to accrue even if loan payments are deferred.
Please use Federal Student Aid's Repayment Calculator!
For more information on PLUS loan repayment options, please visit the Federal Student Aid website.
To be considered, a student must first complete and submit the FAFSA. A parent borrower normally qualifies for PLUS Loan funds as:
Parents may complete the PLUS application at studentloans.gov. Parents will need their Federal Student Aid ID (FSA ID) in order to log on to the website.
PLUS loan borrowers who were originally denied a PLUS loan, but were subsequently approved due to a credit-worth co-signer or had an appeal approved by the Department of Education will need to log into studentloans.gov and complete PLUS Loan Counseling before the loan will pay to a student's account.
If one parent applies for a PLUS loan and is denied based on adverse credit and the other parent applies independently and is approved, the dependent student is not eligible for the increased Federal Unsubsidized Stafford loan amounts.
If a PLUS Loan Application is approved and the parent feels that there are exceptional circumstances that prevent them from borrowing a PLUS loan, a parent may apply for a PLUS Override Request. All parents are required to apply for the PLUS loan before a PLUS Override Request will be reviewed; except families who have filed for bankruptcy and who can provide documentation detailing that as a condition of the bankruptcy they are not allowed to apply or co-sign any loans or families whose incomes are limited to public assistance (social security, disability, etc.)
The following are examples of the exceptional circumstances that might be used to document a dependent student’s eligibility for additional Federal Unsubsidized Stafford Loans:
A PLUS Override approval or a PLUS loan applications denial does not carry over to subsequent academic years. Parents will need to apply for the PLUS loan each academic year and provide current documentation if applying for a PLUS Override Request.
Circumstances that do not warrant a PLUS Override Request:
Information about the Parent PLUS Loan for Undergraduate, dependent students can be found on the Admitted Student Information page and Federal Student Aid. If you’re applying for a Parent PLUS Loan, the video below will provide important tips and walk you through the application process.
The Higher Education Reconciliation Act of 2005 permits a graduate student who has been fully admitted to a Masters or Education Specialist degree program to be considered for funding from the Federal PLUS Loan program. Prior to the passage of this law, only parents of eligible undergraduate students could qualify for Federal PLUS Loan assistance.
However, due to the low overall cost of attendance of attending the University of Central Missouri (even for non-residents of Missouri) very few UCM graduate students have a sufficient level of financial need to borrow from the Federal PLUS Loan program. This is because graduate students can already be considered for Federal Stafford Loans up to $20,500 per award year (in accordance with the student's assigned Federal Cost of Attendance) with no credit history check.
Please visit Admitted Student Information to learn about:
Please visit Financial Tools & Tips for additional information about: