UNM Parent Loans Programs
UNM participates in the Federal PLUS Loan Program (also known as the William D. Ford Direct PLUS Loan). This type of parent loan may be available to parents of dependent students as part of the student’s financial aid award package. The lender is the U.S. Department of Education rather than a bank or other financial institution.
Parent PLUS Loan
- Are not based on financial need and parents may borrow up to the full cost of attendance, less other financial aid received.
- This loan requires a credit check for the parent borrowing the loan.
- Repayment begins 60 days after the loan is fully disbursed. Parents can contact the Direct Loan Servicer after the loan has disbursed to request a deferment for up to 6 months after your student leaves school or drops below half-time. Interest will be capitalized at the end of the deferment period.
- If the parent applicant is not approved for the loan, he or she will have the ability to obtain an endorser or the student can be offered additional Federal Direct Unsubsidized Loan.
- It is possible for a parent to qualify for a PLUS loan with a bad credit score, so long as they don't have an adverse credit history (i.e., no more than 90 days late on any debt and no defaults, bankruptcies or other adverse action on any Title IV debt).
Who can Apply?
- Biological and adoptive parents are eligible to apply for this loan whether or not their information is provided on the FAFSA.
- A stepparent is eligible to apply for a Federal PLUS loan only if his or her information was provided on the FAFSA.
- Grandparents and other relatives are not eligible for this type of loan.
Interest Rates and Fees
- Interest rates are fixed and locked in at the date of the first disbursement of the loan
- Click here for current interest rates and fees for each type of Federal Direct Loan
- There are no annual loan limits or lifetime aggregates for the Parent PLUS Loan program.
- Parent PLUS loans can be awarded up to the student’s Cost of Attendance, less any financial aid received.
How to Apply
Parent PLUS Borrowers
- Complete Free Application for Federal Student Aid (FAFSA)with your student.
- Student must have a Complete your Financial Aid File
- Parent must completely fill out the Federal (Parent) Plus Loan Request form. You can find this form at our office or by visiting our website at https://financialaid.unm.edu/ and clicking on the ‘Forms’ link. This form can be submitted in person or via fax or mail. Our fax number is (505) 277-6326 and the mailing address can be found on our website.
- The parent will be notified of a credit approval by the Department of Education and will need to sign a Parent PLUS Master Promissory Note (MPN). The parent, not the student, will need to complete the Federal Direct PLUS Loan Master Promissory Note through studentloans.gov. The parent will need a FSA ID to log into the site.
- The funds should disburse 3-5 business days after the parent signs the Parent PLUS MPN.
Options for Parent PLUS Denial
The parent will be notified of a credit denial by the Department of Education. The parent can choose to obtain an endorser or appeal the credit decision by calling 1-800-557-7394. Please notify UNM if the parent decides to obtain an endorser or appeal the credit decision. UNM must make additional steps to ensure a loan in this situation disburses properly. If the parent does not wish to pursue those options, UNM will award the student additional unsubsidized loans as long as the student fills out the ‘Student’ section on the bottom of the PLUS application.
To become eligible, you may take one of the following actions:
- Obtain an endorser and complete PLUS Counseling.
- An endorser is someone who does not have an adverse credit history and agrees to repay the loan if you do not repay it.
- If you are a parent borrower, the endorser may not be the student on whose behalf you are requesting the Direct PLUS Loan.
- Document to the satisfaction of the U.S. Department of Education that:
- The information causing the adverse credit decision is incorrect OR
- There are extenuating circumstances relating to the adverse credit history. (Note: Endorsers aren't eligible for this option.)
Tips for Parent Borrowers and Parent PLUS FAQ's
- The Federal PLUS Loan proceeds are applied to the student’s University bill at the beginning of the semester. Any remaining loan balance will be credited to the student in the form of a refund unless the parent indicates that any refund should be mailed via a paper check to the parent’s address provided on the PLUS application.
- If a parent is denied the Parent PLUS loan and does not wish to appeal the decision, the student can borrow additional unsubsidized loan funding by simply completing the ‘Student’ section on the bottom of the PLUS application.
- The Parent PLUS Loan Application includes a section known as the ‘Authorization to Pay’ section. If you answer yes to this question, you are allowing the loan to pay for the student’s charges at UNM. If you answer no to this question, you must make payment arrangements to pay the student’s account balance in full before we can release the credit balance. You’ll need to notify our office when the account balance is zero.
- Review our Parent PLUS FAQ’s.