Parent Loans

Parent Loans

If your student needs additional assistance above and beyond their financial aid offer, one option is a federal or private parent loan. As a parent, you can borrow the difference between the cost of attendance and the amount of aid your student has been offered or will receive. The maximum amount that you can borrow is determined as follows:

Parent (PLUS) Loan Calculation Example
Cost of Attendance $29,400
Aid student will receive -$12,450
Parent loan eligibility $16,950

 

Expand FAQ List

  • Parent Loan FAQs

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      • After July 1st prior to the start of the academic year, you can apply for a loan. 
      • Sign in at StudentAid.gov. 
      • Cursor over Loans and Grants and select PLUS Loans: Grad PLUS and Parent PLUS. Complete an online loan application.  
      • Once you complete the loan application and the credit check is approved, you will be immediately required to complete a Master Promissory Note (MPN). 
      • The completed application and MPN information will then be transmitted by the federal government to our office (typically within 5 business days). Once received, we will then resume the processing of your loan. 
      • The parent loan funds will be credited to your student's account with Student Business Services. Remaining balances may be disbursed as a refund to you or your student (as you indicated on your loan application) via direct deposit or paper check. 
      • Even though this loan is one that you (the parent) will repay, your student must meet the Satisfactory Academic Progress requirements. 
      • To find out more information regarding your parent loan, such as your monthly payment or interest, visit StudentAid.gov. You will need your FSA ID and password. 

      • Loan is only in the parent's name. 
      • Approval is based on a credit decision.  
      • Repayment begins 60 days after the loan is fully disbursed.  
      • Deferment of payment is possible, but you must contact your loan servicer.  
      • Standard repayment is 10 years (120 monthly payments).  
      • Current fixed interest rate is 8.05% for the current academic year. 
      • Current origination fee is 4.228%. 
      • Loan cannot be combined or consolidated with student loans. 
      • Parent loans can be consolidated into one loan.  
      • Parent must complete the Master Promissory Note at StudentAid.gov. 
      • If the loan is denied, the student is eligible to request an unsubsidized loan (amount based on your student's current classification).  
      • Parent Loan Counseling may be required if the loan is initially denied. 

      • Alternative parent loans are private loans offered by lending institutions. They are not part of the federal government’s Direct Loan program. 
      • We encourage your student to file the Free Application for Federal Student Aid (FAFSA®) in order to be considered for all other available aid programs before considering alternative loans. 
      • The interest rates and repayment terms with alternative parent loans are generally less favorable than those of the federal Parent PLUS loan program. 
      • Be aware that the amount certified by Texas State may, in order not to exceed your student's cost of attendance, be less than the amount you requested on your initial application. 
      • To be sure you choose the right alternative parent loan, you will want to consider the following: 
      1. Does my school have to certify the application? 
      2. Do I need a cosigner? 
      3. How strict are the credit requirements? 
      4. How long does the application process take? 
      5. How will I receive my loan funds?  
      6. When will my first payment on my loan be due? 
      7. Does the loan have an annual or aggregate limit? 
      8. How much in total loan fees will I pay? 
      9. What is the current interest rate and how is it calculated?   
      10. How long is the repayment period? 
      11. What are my repayment options? 
      12. Do I have a grace period with this loan? If yes, how long?  

      Texas State does not recommend any specific lenders for alternative parent loans. If you believe that a loan may be best for you, we recommend comparing the loan products and lenders to find the best interest rate and repayment options for your situation. Please remember that you will have to pay back these loans with interest, so only borrow what you need.  

      • Wrong School Year – Schools process for two award years simultaneously, so make sure the correct year is selected. 
      • Social Security Numbers – If a wrong Social Security number is entered for the student or parent, we will not be able to match the record to the student. 
      • Reversed Information – If the first and last name are reversed or the parent data is entered in the student section, we will not be able to match the record to the student's account.  
      • Keep in mind the parent loan application is different than the Master Promissory Note (MPN). The parent loan application must be completed every year. 
      • The MPN must only be completed by a first-time borrower once per 10–year period. The only exception is when an endorser is involved, which requires an MPN to be completed every year.