We understand that getting denied for a PLUS loan can be a stressful situation and raise understandable concerns about a student's ability to finance a college education. SFS will receive electronic notification of denied PLUS loans in 1-2 business days after a credit denial decision is determined by the U.S. Department of Education.
A parent or graduate student who is denied for a PLUS loan should not attempt to cosign a private loan or borrow a private loan without a credit-worthy cosigner, as credit eligibility criteria are more restrictive with private lenders.
Students must still adhere to tuition payment deadlines, regardless if a PLUS loan review is pending or an option below does not return a favorable outcome. Students should never ignore tuition bills, but should contact the Bursar to discuss payment options.
Parents who attempted to borrow the Parent PLUS loan but were denied can have their student provide a written request to be awarded an additional unsubsidized Stafford Loan equal to the limits of an Independent Student at their class level (earned credits).
The additional unsubsidized Stafford Loan will disburse to the student account in two portions less the government's 1.0% mandatory origination fee with half applying toward each semester (Fall/Spring).
You may add a credit-worthy endorser (similar to a cosigner) to your PLUS Loan if you aren't approved on your own credit. An endorser is any credit-worthy person who will sign the MPN with the parent borrower and take on equal liability for the PLUS Loan debt.
Note: The endorser is liable only for the specific loan amount that he or she has agreed to endorse.
If it is determined that the parent has an adverse credit history and obtained an endorser for a Federal Direct PLUS Loan, the Federal Direct PLUS MPN becomes a "single-loan" promissory note. No further Federal Direct PLUS Loans may be made under that Federal Direct PLUS MPN. Further information regarding PLUS loan endorsement can be found online or by calling COD Applicant Services at 1-800-557-7394.
You may appeal your credit denial decision with the U.S. Department of Education. If an endorser is approved, your Direct PLUS loan decision will be overturned from a denial to an approval. The student then becomes ineligible for an additional Unsubsidized Stafford Loan. The originally denied parent must also complete a new Parent PLUS MPN.