There is no grace period for a Direct PLUS Loan—the repayment period begins 60 days after your school makes the last disbursement of the loan. However, if you're a parent PLUS borrower who is also a student, you can defer repayment while you're enrolled in school at least half time and (for Direct PLUS Loans first disbursed on or after July 1, 2008) for an additional 6 months after you graduate or drop below half-time enrollment.
If you're a parent PLUS borrower, you can defer repayment of Direct PLUS Loans first disbursed on or after July 1, 2008, while the student for whom you obtained the loan is enrolled at least half time, and for an additional 6 months after the student graduates or drops below half-time enrollment (half-time enrollment status is determined by your child's school). You must separately request each deferment period.
Generally, you'll have from 10 to 25 years to repay your loan, depending on the repayment plan that you choose. You can choose to repay your PLUS Loan using the standard, extended, or graduated repayment plan. Read more about these repayment plans.
Your loan servicer will notify you of the date your first payment is due. If you do not choose a repayment plan, your loan servicer will place you on the standard plan, with fixed monthly payments for up to 10 years. Most Direct Loan borrowers choose to stay with the standard repayment plan, but there are other options for borrowers who may need more time to repay or who need to make lower payments at the beginning of the repayment period.
You can change repayment plans at any time by contacting your loan servicer.
If you have multiple federal education loans, you can consolidate them into a single Direct Consolidation Loan. This may simplify repayment if you are currently making separate loan payments to different loan holders, as you'll only have one monthly payment to make. There may be tradeoffs, however, so you'll want to learn about the advantages and possible disadvantages of consolidation before you consolidate. To learn more, visit the Direct Consolidation Loan website.
Automated payments (electronic debit)
When you receive your first bill, you'll learn how to sign up for the electronic debit account (EDA) option and have your bank automatically make your monthly loan payments for you from your checking or savings account. You won't have to write checks, use stamps, or worry if your payment will get to us by the due date. In addition, there is a 0.25% reduction in the interest rate on your loans during any period when your payments are made through EDA.
Trouble making payments
If you're having trouble making payments on your loans, contact your loan servicer as soon as possible. Their staff will work with you to determine the best option for you. Options include:
- Changing repayment plans.
- Deferment, if you meet certain requirements. A deferment allows you to temporarily stop making payments on your loan.
- Forbearance, if you don't meet the eligibility requirements for a deferment, but are temporarily unable to make your loan payments. A forbearance allows you to temporarily stop making payments on your loan, temporarily make smaller payments, or extend the time for making payments. Read more about deferments and forbearance.
If you stop making payments and don't get a deferment or forbearance, your loan could go into default, which has serious consequences—see below.
Your loan becomes "delinquent" if your monthly payment is not received by the due date. If you fail to make a payment, we'll send you a reminder that your payment is late. If your account remains delinquent, we'll send you warning notices reminding you of the consequences of default and of your obligation to repay your loans.
If you are delinquent on your loan payments, contact your loan servicer immediately to find out how to bring your account current. Late fees may be added, and your delinquency will be reported to one or more national consumer reporting agencies (credit bureaus), but this is much better than remaining delinquent on your payments and going into default.
Consequences of default
If you default:
- We will require you to immediately repay the entire unpaid amount of your loan.
- We may sue you, take all or part of your federal and state tax refunds and other federal or state payments, and/or garnish your wages so that your employer is required to send us part of your salary to pay off your loan.
- We will require you to pay reasonable collection fees and costs plus court costs and attorney fees.
- You may be denied a professional license.
- You will lose eligibility for other federal student aid and assistance under most federal benefit programs.
- You will lose eligibility for loan deferments.
- We will report your default to national consumer reporting agencies (credit bureaus).
For more information and to learn what actions to take if you default on your loans, see the website for the Department's Default Resolution Group.