December 3, 2009

Can I Cancel My Parent Plus Loan?

Posted in Parent PLUS Loans tagged at 12:54 PM by dbonvie

YES. You can cancel a PLUS loan the same way a borrower would cancel a Perkins or a Stafford loan. In fact, even after the funds have been disbursed to the school you can still cancel your loan. You would just contact a financial aid officer at the school and let them know that they can send the funds directly back to the lender, provided your request is received within the designated add/drop period. Keep in mind, however, that in some instances you can not get back the origination and default fee of 4% back.

Does A Parent Plus Loan Have Fees?

Posted in Private Loans tagged , , at 12:02 PM by dbonvie

YES. Parent Plus loans do have fees.

The standard fees attached to a federal Parent Plus loan include a 3% origination and a 1% default fee. That 4% can be quite significant too if you are taking out a great deal of money for your student. It’s also important to note that those fees are taken right off the top as well. So if you need $10,000 you should apply for $10,400. That way $10,000 will make it’s way over to the school.

You may also find that some lenders are willing to waive the default fee. If this is the case jump on that deal. A 3% fee is obviously better than a 4% one.