PLUS Loan Terms & Definitions

Academic Year

A period of time schools use to measure a quantity of study. For example, a school's academic year may consist of a fall and spring semester, during which a student must complete 24 semester hours. Academic years vary from school to school, and even from educational program to educational program at the same school.

Interest Rate

The PLUS interest rate is fixed at 7.21%.

PLUS Loan Repayment Term

PLUS Loans may be paid over a ten year period - or less - depending on the amount borrowed. There is a minimum monthly payment of $50. If you need to extend your repayment term, you must consolidate your PLUS loans.

Citizen/Eligible Non-citizen

You must be one of the following to receive federal student aid:

  • U.S. citizen
  • U.S. national (includes natives of American Samoa or Swain's Island)
  • U.S. permanent resident who has an I-151, I-551, or I-551C (Alien Registration Receipt Card)

If you're not in one of these categories, you must have an Arrival-Departure Record (I-94) from the U.S. Immigration and Naturalization Service (INS) showing one of the following designations in order to be eligible:

  • "Refugee"
  • "Asylum Granted"
  • "Indefinite Parole" and/or "Humanitarian Parole"
  • "Cuban-Haitian Entrant, Status Pending"
  • "Conditional Entrant" (valid only if issued before April 1, 1980)

If you only have a Notice of Approval to Apply for Permanent Residence (I-171 or I-464), you aren't eligible for federal student aid.

If you're in the United States on an F1 or F2 student visa only, or on a J1 or J2 exchange visitor visa only, you can't get federal student aid. Also, persons with G series visas (pertaining to international organizations) are not eligible for federal student aid.

Note: Citizens and eligible non-citizens may also receive loans from the Direct Loan programs at participating foreign schools through a Stafford Loan.

Citizens of the Federated States of Micronesia, the Republic of the Marshall Islands, and the Republic of Palau are eligible only for Federal Pell Grants, Federal Supplemental Educational Opportunity Grants (FSEOGs), or Federal Work-Study. These applicants should check with their financial aid administrators for more information.

Cost of Attendance (COA)

The total amount it will cost a student to go to school. This is usually expressed as a yearly figure. It is determined using rules established by the U.S. Congress. The COA includes tuition and fees; on-campus room and board (or a housing and food allowance for off-campus students); and allowances for books, supplies, transportation, loan fees, and, if applicable, dependent care, costs related to a disability, and miscellaneous expenses, including an allowance for the rental or purchase of a personal computer. Also included are reasonable costs for eligible study-abroad programs. An allowance (determined by the school) is included for reasonable costs connected with a student's employment as part of a cooperative education program. For students attending less than half time,* the COA includes only tuition and fees and an allowance for books, supplies, transportation, and dependent-care expenses. Talk to the financial aid administrator at the school you're planning to attend if you have any unusual expenses that might affect your cost of attendance.


Failure to repay a loan according to the terms agreed to when you signed a promissory note. Default also may result from failure to submit requests for deferment or cancellation on time. The consequences of default are severe, and include:

  • Derogatory remarks on your credit report
  • Garnishment of tax refunds
  • Garnishment of wages
  • Civil lawsuits

Eligible Program

A course of study that leads to a degree or certificate and meets the U.S. Department of Education's requirements for an eligible program. To get federal financial aid, you must be enrolled in an eligible program, with two exceptions:

  • If a school has told you that you must take certain coursework to qualify for admission into one of its eligible programs, you can get a Direct Loan (or your parents can get a PLUS Loan) for up to 12 consecutive months while you're completing that coursework. You must be enrolled at least half time, and you must meet the usual student aid eligibility requirements.
  • If you're enrolled at least half time in a program to obtain a professional credential or certification required by a state for employment as an elementary or secondary school teacher, you can get a Federal Perkins Loan, Federal Work-Study, a Direct Stafford loan, (or your parents can get a PLUS Loan) while you're enrolled in that program.
  • Applicants may be required by their school to complete the FAFSA form or other financial aid application.

Financial Aid Package

The total amount of financial aid (federal and non-federal) a student receives.

General Education Development (GED) Certificate

A certificate students receive if they've passed a specific, approved high school equivalency test. Students who don't have a high school diploma but who have a GED may still qualify for federal student aid. A school that admits students without a high school diploma must make a GED program in the vicinity of the school available to these students and must inform them about the program. Students who pass an approved ability-to-benefit (ATB) test may also be qualified. An applicant without a high school diploma or its recognized equivalent can be eligible for funds if he or she 1) passes an independently administered test, ATB, approved by the Department of Education and used for determining the student's ability to benefit from postsecondary education or 2) enrolls in a school that participates in a process that has been both prescribed by the state in which the school is located and approved by the Department.

Half Time

At schools measuring progress by credit hours and semesters, trimesters, or quarters, half-time enrollment is at least six semester hours or quarter hours per term. At schools measuring progress by credit hours but not using semesters, trimesters, or quarters, half-time enrollment is at least 12 semester hours or 18 quarter hours per year. At schools measuring progress by clock hours, half-time enrollment is at least 12 hours per week. Note that schools may choose to set higher minimums than these.

You must be attending school at least half time to be eligible to receive Federal Direct loans. Half-time enrollment is not a requirement to receive aid from the Federal Pell Grant, Federal Supplemental Educational Opportunity Grant (FSEOG), Federal Work-Study, and Federal Perkins Loan programs.

Promissory Note

The binding legal document you sign when you get a student loan. It lists the conditions under which you're borrowing and the terms under which you agree to pay back the loan. It will include information about your interest rate and about deferment and cancellation provisions. It's very important to read and save this document because you'll need to refer to it later when you begin repaying your loan.

Regular Student

One who is enrolled in an institution to obtain a degree or certificate. Generally, to receive aid from the programs discussed in this booklet, you must be a regular student. (For some programs, there are exceptions to this requirement. See the definition of eligible program.)

Satisfactory Academic Progress

To be eligible to receive federal student aid, you must maintain satisfactory academic progress toward a degree or certificate. You must meet your school's written standard of satisfactory progress. Check with your school to find out its standard.

If you're enrolled in a program that's longer than two years, the following definition of satisfactory progress also applies to you: You must have a C average by the end of your second academic year of study or have an academic standing consistent with your school's graduation requirements. You must continue to maintain satisfactory academic progress for the rest of your course of study.

Selective Service Registration

If required by law, you must register, or arrange to register, with the Selective Service to receive federal student aid. The requirement to register applies to males who were born on or after January 1, 1960, are at least 18 years old, and are not currently on active duty in the U.S. Armed Forces. (Citizens of the Federated States of Micronesia, the Marshall Islands, or Palau are exempt from registering.)