The financial needs of our students' families are as different as the families themselves. For most students, the need-based assistance offered by HMC is sufficient to pay for college when combined with the family's calculated contribution.

However, the reality for many families is that they are not prepared to contribute the calculated family contribution. Many parents look for low interest financing options, such as Federal Direct PLUS Loans, to help reduce monthly expenses and extend the payment of the year's costs.

NEW in the 2010-2011 Academic Year, Harvey Mudd College will be participating in  the William D. Ford Federal Direct Loan Program (Direct Loans) that consist of Direct PLUS Loan. Direct PLUS Loan (Parent Loan for Undergraduate Students) offers parents an excellent low-interest loan alternative to paying for college costs during the academic year. With Direct PLUS Loan, a family can borrow up to the difference between the cost of attendance and the amount of any financial aid the student is eligible to receive.

The parent borrower must pass a mandatory credit check performed by the Direct Loan Servicing Center. If a parent's Direct PLUS Loan application is denied due to unsatisfactory credit, the student is automatically eligible for an additional Direct Unsubsidized Loan. First- and second-year students are eligible for an additional $6,000 and third- and fourth-year students are eligible for an additional $7,000 if the Direct PLUS Loan is denied. This unsubsidized loan amount is in addition to the loan limits for the Direct Subsidized and Unsubsidized Loans listed below.

Direct PLUS Loan Benefits
Who May Apply
Interest Rates and Terms 
How to Apply

Direct PLUS Loan Benefits

Benefits of the  Direct PLUS Loan include:

•  low interest rate
•  lower monthly payments
•  an extended payment period for educational costs
•  option of deferring repayment based on student's enrollment status

Who May Apply

To borrow a Direct PLUS loan for a student, the parent borrower must pass a mandatory credit check perform by the Direct Loan Servicing Center and be the student's biological or adoptive mother or father. A stepparent whose assets and income are taken into account when determining the student's Expected Family Contribution is also eligible to borrow a Direct PLUS loan. Interest Rates and Terms Interest is fixed at 7.9%.  There is no grace period for a  Direct PLUS Loan. Interest begins to accrue immediately after the first disbursement of the Federal Direct PLUS Loan, and repayment of both principal and interest begins within 60 days after the final disbursement of the loan. Direct PLUS Loan is subjected to a 4 percent origination fee.

Interest Rates and Terms
   
Interest is fixed at 7.9%.

Direct PLUS Loan is subject to a 4 percent origination fee with a 1.5 percent up-front interest rebate and the interest rate is fixed at 7.9 percent.

There is no grace period for Direct PLUS Loans.  However, for Direct PLUS loans that are first disbursed on or after July 1, 2008, parent borrowers have the option of deferring repayment based on your enrollment status. Specifically, parent borrowers may defer repayment:

• While you, the student, are enrolled on at least a half-time basis, and
• During the 6-month period after you cease to be enrolled on at least a half-time basis

Parent borrowers may complete and submit the In-School Deferment Request Form, which is available on the Direct Loan website at www.dl.ed.gov or by calling the Direct Loan Servicing Center (DLSC) at (800) 848-0979 for assistance.  Note that if your parent does not choose to defer payment, repayment begins 60 days after full disbursement of the loan.

Interest will be capitalized until repayment begins. If a deferment is chosen, your parent will be sent a quarterly interest statement and will have the option of paying the interest as it accrues during the deferment period. Your parent may be allowed up to thirty years for repayment.

In addition, if a parent's Direct PLUS Loan application is denied due to unsatisfactory credit, the student is automatically eligible for an additional Direct Unsubsidized Loan.  First- and second-year students are eligible for an additional $6,000 and third- and fourth-year students are eligible for an additional $7,000 if the Direct PLUS Loan is denied.  

How to Apply

1) Submit the Direct PLUS Loan Application (New Borrower)

2) Submit the Direct PLUS Loan Electronic Master Promissory Note (EMPN)

These forms can be mailed, faxed, or emailed to the Office of Financial Aid.

Note: If you would like to go with the Federal Family Educational Loan Program during the 2010-2011 academic year for the PLUS Loan, please contact the Office of Financial Aid.

Last Updated: January 2010