Federal Parent PLUS Loans |
Alternative Loans |
|
PLUS Loans are federally insured and are discharged in the
event of total and permanent disability or death |
Not federally insured and does not offer discharged in the
event of disability or death |
|
PLUS Loans offer a fixed rate with a
maximum of 9% |
Have variable interest rates that are reset quarterly and usually have a higher interest cap |
|
Approval is not based upon financial need, only the borrower's credit
standing |
Borrowers must meet minimum income and debt-to-income ration
requirements as well as pass a comprehensive credit check |
|
The PLUS Loan Master Promissory Note is good for ten years -
no need to sign a new note every year! |
Must re-apply and sign a new promissory note each year |
|
PLUS offers unemployment and economic hardship deferments |
No similar deferments for alternative loans |
|
Income sensitive, graduated, and extended repayment options
are available |
Generally, these deferments are not offered by private lenders |
|
No loan limits (except the cost of education less other
financial aid) |
Alternative Loans often have both annual and aggregate loan
limits |
