Parent PLUS Loan

General Information
Parent loans are designed to assist parents who need additional educational financing. Loan approval is based on credit worthiness and ability to repay. Parent loans are available to a parent whose student is pursuing a degree program, enrolled at least half-time, and is maintaining Satisfactory Academic Progress. In addition, students and their parent/s must have completed the Free Application for Federal Student Aid (FAFSA ). As with any loan, careful consideration should be made in determining amounts to be borrowed, as the loan must be repaid. To borrow a PLUS loan for a student, the parent must be the student's biological or adoptive mother or father. The spouse of a parent who has remarried (i.e., the student's stepparent) is also eligible to borrow a PLUS on the student's behalf, if his/her income and assets would be taken into account when calculating the dependent student's expected family contribution on the FAFSA. A legal guardian is not considered a parent for FSA purposes. If the parent applying for a PLUS loan is not the parent that completed the FAFSA, but is the biological parent, and has not completed the CSS profile non custodial parent form, our office requires that this parent complete a PLUS loan addendum .

Interest on the Federal Parent PLUS Loan
Interest rates for Parent PLUS loans disbursed on or after July 1, 2006 will be at a fixed interest rate of 8.5%. Interest is charged on the loan from the date the first disbursement is made until the loan is paid in full.

Federal Parent PLUS Loans disbursed July 1, 1998 through June 30, 2006 carry a variable interest rate based on the final auction of 90-day Treasury Bills held prior to June 1. Parents will be notified of interest rate changes throughout the life of the loan.

Applying for a PLUS Loan
Tulane participates in the FFEL PLUS Loan program. To apply, parents must complete and submit a PLUS Loan application to a participating lender. Most lenders offer a "pre-approval" process to parents. Parents can complete a form online or provide their information over the phone. Parents must provide the lender with the LOAN AMOUNT REQUESTED and the LOAN PERIOD when completing a loan application.

Tulane encourages parents to apply for a PLUS loan by July 1 in order to ensure that the funding arrives before the fall semester begins. Parents interested in borrowing through the Federal PLUS loan program MUST complete a Free Application for Federal Student Aid (FAFSA) for the current academic year.

The yearly limit on a PLUS loan is equal to a student's cost of attendance (including tuition and fees, and an allowance for room, board, books, travel and miscellaneous) minus any financial aid the student is receiving.

Once the loan is approved, complete, and signed the lender will send Tulane a request for school certification. School certification is the process by which Tulane verifies whether the student is eligible to receive the requested loan amount during the specified loan period. Financial Aid Counselors begin the certification process after July 1. Parents will be notified by mail that the loan certification has been completed. Parents who have not received notification of certification by August 15, please contact our office at (800) 335-3210 or (504) 865-5723. Tulane will only certify Parent Plus loans that have are complete, signed, and approved by the lender.

Picking the right lender for your parent loan is an important decision. The streamlined lenders below have worked with parents to help their students achieve their educational goals. So when you choose a streamlined lender, you're working with experts who understand your needs.

A : Absolutely. You can save hundreds of dollars by choosing a lender with the best repayment benefits. Benefits that are not contingent on making a certain number of on-time payments before the repayment benefits go into effect. However, their special benefits (which may be cancelled at any time by the lender) do differ. Please review each lender's benefits on their website before making a decision. Note: All streamlined lenders below will charge a 3% origination fee and a 0% Guarantee fee.

A : Yes. All lenders are required by federal law to charge the same interest rate. Loans made on or after July 1, 2006 have a fixed rate of 8.50%

A: Never borrow more than is absolutely necessary. Remember: The more money you borrow now, the more you'll spend paying it back. Only borrow what you need, try to limit your level of borrowing . Some lenders have a minimum amount they will lend. The maximum Tulane can certify is cost of education less other financial aid.

A : Most lenders offer up to 10 years to repay a parent loan. Parents should check directly with their lender to view the terms of their loan.

A : Lenders require that the parent is a U.S.Citizen or permanent resident and is credit-worthy. Approval decisions come directly from the lender.

A: The Parent Plus loan is based on creditworthiness. A credit report will be pulled and reviewed by the lender. If you are denied a parent plus loan only the lender can discuss the reasons for a denial. You should contact the lender directly. On occasion they find discrepancies on your credit report that can be resolved. The lender will indicate to Tulane that a parent has been denied. Tulane will notify the student that he/she may have an option to borrow additional funds through the Unsubsidized Stafford Loan program .

A : Yes. The "turnaround time" required by different lenders varies. However, by choosing one of our streamlined lenders, the lender is committed to delivering fast, accurate loan disbursements as a top priority.

A : Servicers are companies that manage payments, address updates, deferments, and forbearance for borrowers.

A : Yes. When you call a servicer or lender, it is important to be able to speak to a person, as opposed to only a computer voice system. It is important to have a lender whose customer service staff can answer all your questions about education financing.

The following is a list of Tulane's streamlined lenders. Choosing one of these lenders will allow us to process the PLUS loan electronically and receive the funds via electronic funds transfer (EFT) Parents, however, may select another lender (see note below*). Please be sure that the lender participates in the Federal PLUS loan program.

Parents are encouraged to view each lenders website and review the benefits (which may be cancelled at any time by the lender) offered. You should apply directly with the lender. Most lenders will allow you to e-sign your Plus Master Promissory Note (MPN) online.

How We Choose Our Lender List
As a service to our student and parent educational loan borrowers, Tulane's University Financial Aid Offices have attempted to identify a list of lending institutions who we believe offer quality customer service and benefits with their respective federal and/or non-federal loan products.

The composition of our list of suggested lenders is the result of our annual "request for proposals" (a/k/a "RFP") process, whereby interested lenders submit proposals for our consideration. The main criteria we expect from lenders include all of the following:

reliable customer service (including service during processing and repayment);
competitive loan products (including competitive fees and interest rates);
electronic disbursement of funds;
allowance for borrower electronic repayment of loan funds; and
cost saving benefits to borrowers throughout the life a loan.

The Tulane "Loan Committee" thoroughly reviews and researches each proposal received each year before finalizing a list of lenders meeting the aforementioned criteria. We want to assure all educational loan borrowers that Tulane's University Financial Aid Offices do not receive any form of payment or remuneration from lenders in exchange for inclusion on our lender listing. As long time members of the National Association of Student Financial Aid Administrators (NASFAA), the employees of Tulane's University Financial Aid Offices fully adhere to NASFAA's Statement of Ethical Principles and Code of Conduct for Institutional Financial Aid Professionals.

Please know there is absolutely no obligation for borrowers to select a lender from our lender listing. Student and/or parent borrowers have the right to select a lender of their choice. Per federal and institutional guidelines, the University Financial Aid Offices will process any loan from any lender.

Finally, we wish to point out that our list of lenders is not in any order of preference.

We highly recommend that a borrower's lender choice be carefully considered as to what is best for the borrower and with the intent that one will remain with the same lender throughout one's studies at Tulane.

The Tulane University Financial Aid Offices remain committed to the students we serve. As such, we will continue to annually review our suggested lenders to ensure that our students and their families receive reasonable rates and good customer service.

Families are encouraged to view each Federal Parent PLUS lender's website and review the benefits offered. General comparison information may be found on Tulane's Lender List pages located on ELM Select: http://www.elmselect.com/oll/SchoolLenderList/?schoolId=8282

Note: Parents who would like to choose their own lender should request an application/promissory note directly from their lender. Parents must send a copy of their Parent Plus Master Promissory Note to Tulane. The MPN must include the lender's name, lender code, lender's address and guarantor's name. In addition, please provide a letter indicating the dollar amount and loan period for the Parent Plus loan. Tulane will send certification to the lender either by ELM (if the lender is a participant), by fax, or by mail.

Receiving the PLUS Loan
Federal PLUS lenders belonging to the ELM Resources' alliance of lenders disburse loan funds electronically to Tulane. Federal PLUS loans are disbursed in two installments. When the specified loan period is the entire academic year, the PLUS funds are disbursed in August and in January. When the specified loan period is one semester out of the academic year, the PLUS funds are also disbursed in one disbursement - three days prior to the beginning of the semester.

Other lenders (who do not participate in ELM Resources' alliance of lenders) disburse loan funds via paper check to the university. The funds are disbursed in two installments by means of co-payable check. The check is sent to the Tulane Bursar's Office. Once the Bursar's Office confirms the student's registration, the Bursar will sign the check for Tulane and mail it to the parent at the student's permanent address. The parent should deposit the check in his or her personal bank account and then write a personal check to the university to cover any outstanding charges.

Repayment of the PLUS Loan
Generally, repayment must begin within 60 days after the loan is fully disbursed. PLUS loans do not carry a grace period. Interest begins to accumulate at the time the first disbursement is made. Parents must begin repaying both the principle and interest while the student is in school.

Tax incentives exist for certain higher education expenses, including a deduction for student loan interest for certain borrowers. Students and parents should refer to Publication 970 at www.irs.gov or a qualified tax advisor for help.

Loan Tracking Information
Parents interested in verifying their loan account balances can use one of the following online resources:

Lenders interested in being a part of Tulane's streamlined process should contact Jennifer M. McNeel, our lender liaison at jmcneel@tulane.edu Tulane reviews RFP information annually every December.