Simply stated, if you are under 24 years old and legally single then you are a dependent according to FASA. Even if you’ve been supporting yourself for years, according to the Department of Education your parents still have a responsibility to provide their income tax statements on your behalf when you file for a federal loans. This does not mean they are obligated to help you pay for your education, but they are affecting your loan by providing proof of income which will determine how much of a loan you qualify for. There are ways to get independent status if you’re under 24, such as getting emancipated from your parents, but even those sometimes don’t hold water in the financial aid offices.
What Stays the Same:
• You can still only borrow a certain amount and these loans come as either subsidized or unsubsidized loans.
• You don’t need to run a credit check, the amount you can borrow is based on your FAFSA.
•They have the same interest rates as undergraduate loans.
What’s Different:
•
The maximum you can borrow is higher:
For Independent Students: “The annual loan limit for a graduate independent student is $20,500,” notes Erica. “But no more than $8,500 of this amount may be in subsidized loans. And the total lifetime loan limit is $138,500, including undergraduate. Up to $65,000 may be subsidized.” If you’re studying a medical profession then you can borrow more: up to $224, 000.
For Dependent Students: If you are a dependent then you will have the same rates as you did as an undergraduate.
TAKE NOTE: The maximum you can borrow in Graduate Stafford Loans includes what you borrowed in Stafford Loans as an undergrad.
Graduate and Parent PLUS Loans
“The Graduate PLUS Loan is the same loan offered to parents,” explains Erica, “except graduate students need to file a FAFSA and they must have their annual loan maximum eligibility under the Stafford Loan program determined by the school before they apply for a PLUS loan.”
Meaning that you must first be approved for a Stafford Loan before you can apply for a PLUS loan.
Erica notes that with either the Graduate or Parent PLUS Loan you “can borrow up to the total cost of attendance less other aid received, such as grants, scholarships, and Stafford loans.” Students doneed to pass a credit check in order to be approved for this loan. But don’t worry, you just need to NOT have horrible credit (i.e. be in default on other loans or in major debt). The interest rate is fixed at 8.5%, as with the Parent PLUS Loan.
Also keep in mind that while you don’t have to make payments on your PLUS Loan while at school, interest will accrue during that time.
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