The Direct Graduate PLUS Loan is available to U.S. citizens and permanent residents who are enrolled in a degree-seeking program at least half-time (6 credits) and not in an active default on a prior federal student loan. The Direct Graduate PLUS Loan requires a separate credit application to determine approval. The maximum annual award is the cost of attendance minus all other financial aid. The Direct Graduate PLUS Loan is not based on financial need.

The Direct Graduate PLUS Loan begins to accrue interest upon disbursement and has a six-month grace period before repayment begins after graduation or dropping below half-time enrollment. All federal and institutional program rules must be met for receipt of funds.

The Financial Aid Office does not include the Direct Graduate PLUS Loan in the initial financial aid award. Students must first apply and be approved for the loan before it is added into the financial aid package. 

The interest rate for the Direct Graduate PLUS Loan changes every July 1. For loans disbursed on or after July 1, 2024, the interest rate is 9.08%. The interest rate is fixed for the life of the loan meaning that it is possible to have three (for full-time JD) or four (for part-time JD) different rates on the loans from your legal education.

The loan fee for the Direct Graduate PLUS Loan, as established and assessed by the Department of Education, changes every October 1. For loans disbursed before October 1, 2020, an origination fee of 4.236% is deducted from each disbursement. For loans disbursed on or after October 1, 2020, an origination fee of 4.228% is deducted from each disbursement. This fee deduction results in a net disbursement smaller than the gross amount offered in the financial aid package.

The Free Application for Federal Student Aid (FAFSA) is required of all federal loan applicants. The FAFSA is filed online. Select American University title IV code 001434. Please note this is the same title IV school code for main campus and the Washington College of Law. All financial aid application and program policies must be satisfied in order to receiving funding.

The FAFSA becomes available October 1 on an annual basis. The AUWCL financial aid deadline is March 1 with award notices for the following academic year emailed beginning in mid-March for prospective students. (PLEASE NOTE: Due to Department of Education 2024-2025 FAFSA processing delays, the AUWCL Financial Aid Office may receive FAFSA data and process award notices later than mid-March 2024).

The Direct Graduate PLUS Loan also requires a credit application completed at www.studentaid.gov. Prospective students must complete the credit application after May 1 and continuing students must complete the credit application after April 15 for the following academic year, including if attending during the summer term. Upon approval, the AUWCL Financial Aid Office is notified of the pending application for processing. Direct Graduate PLUS Loans are typically processed starting in early summer. If an applicant is denied based on their credit application, a credit-worthy endorser can be added to the loan in an attempt to receive approval. Additionally, an applicant can appeal a denial with the Department of Education directly if there is an erroneous entry on their credit preventing the approval. For more information about credit eligibility, please click here.

After being awarded the Direct Graduate PLUS Loan, the loan must be accepted in the Eagle Service portal. Recipients are required to complete the federal loan entrance counseling, an online tutorial that explains the rights and responsibilities of the borrower, and the loan agreement (MPN), which is the formal agreement signed by the borrower obligating them to repayment of the loan. For those Direct Graduate PLUS Loan borrowers approved with an endorser or by appeal, an additional PLUS credit counseling is required. Federal loan exit counseling must be completed upon graduation or dropping below half-time enrollment, including withdrawal or taking a leave of absence. All aforementioned loan requirements are completed at https://studentaid.gov.

Upon graduation, leaving school, or dropping below half-time, there is a six-month grace period before loan repayment begins. Loans previously in repayment with exhausted grace periods will begin repayment immediately. During the grace period, the loan servicer will notify the borrower of the first payment due date and amount. To identify the loan servicer for a specific loan, please visit your Federal Student Aid Dashboard. FSA ID and password are required.

There are several different types of loan repayment options available; some of which are based upon debt with many based upon income and other factors. The standard repayment plan divides the debt and interest over 10 years (120 payments) to determine the fixed monthly payment. The income-driven plans can make repayment much more manageable and typically carry an option for loan forgiveness after 10, 20, or 25 years, depending on the plan. These plans require an annual application to determine the monthly payment during that period. The income-driven plans are also tied to Public Service Loan Forgiveness (PSLF), which currently provides tax-free loan forgiveness after making 120 on-time payments in a qualifying job while enrolled in a qualifying repayment plan.

The AUWCL Financial Aid Office offers numerous resources to assist with determining which loan repayment option may be the best fit. Please contact us directly for more information or visit the Federal Student Aid website on loan repayment.