On July 4, 2025, the One Big Beautiful Bill Act (OBBBA) was signed into law, resulting in changes to federal student aid programs. Some of these changes went into effect immediately, while others will go into effect next year and beyond.
Eliminates the Graduate PLUS loan program effective July 1, 2026.
Legacy Provision: If a borrower has a Federal Direct Loan made before July 1, 2026, and while enrolled in the same program of study at the same institution as they were enrolled as of June 30, 2026, the borrower can continue to borrow from the program for 3 academic years or the remainder of their expected time to credential, whichever is less.
Graduate students meeting the legacy provision are eligible to borrow under the PLUS Loan Program to help pay for education expenses not covered by other financial aid.
Eligibility
Student meeting the legacy provisions above must:
- Have a valid Free Application for Federal Student Aid (FAFSA) on file;
- Be fully admitted as a degree-seeking student at ISU;
- Be enrolled at least half-time when the loan is expected to be disbursed;
- Maintain Satisfactory Academic Progress (SAP) standards;
- Be a U.S. Citizen or eligible non-citizen (as defined by federal financial aid regulations);
- Not be in default on an educational loan or owe an overpayment on a federal education grant, or other federal debt, or has made satisfactory arrangements to repay that debt;
- Be a creditworthy graduate student;
- Apply for annual loan maximum eligibility under the Federal Unsubsidized Stafford Loan Program before applying for a Federal Direct Graduate PLUS loan;
- Be creditworthy:
- Regulations provide that a PLUS loan applicant has an adverse credit history if:
- The applicant has a history of bankruptcy, foreclosure, tax lien, or a default determination; and
- the applicant has one or more debts that are 90 or more days delinquent or that are in collection or have been charged off during the two years preceding the date of the applicant’s credit report, but only if the total combined outstanding balance of those debts is greater than $2,085.
- Thus, absent any other adverse credit history finding a PLUS Loan applicant whose credit check shows that the total of any debts that are 90 or more days delinquent or that have been placed in collection or charged off is $2,085 or less will not be considered to have adverse credit and therefore, will be eligible for a PLUS Loan.
- Regulations provide that a PLUS loan applicant has an adverse credit history if:
How To Apply
- File the Free Application for Federal Student Aid (FAFSA).
- The electronic application is available at StudentAid.gov.
- Borrowers will need to have their own FSA ID.
- Student logs into StudentAid.gov
- From the Account Dashboard select Applying for Aid, then Apply for a Grad PLUS Loan
- A Credit Check will be initiated at the end of the applications with immediate results. Credit Checks expire after 180 days.
- First-time borrowers must complete the Graduate Plus Loan Master Promissory Note and Entrance Counseling at StudentAid.gov
- The student will receive notification directly from the U.S Department of Education on approval/denial.
Amount
A student may borrow up to the cost of attendance minus any financial aid offered for the school year.
Loan Repayment, Interest Rates and Fees
The interest rate is fixed and capitalizes annually. Loans are subject to an origination fee upon disbursement. Current rates and fees are published quarterly here: https://studentaid.gov/sa/types/loans/interest-rates.
Payment may be deferred if the student is enrolled half-time. Learn more about loan deferment and repayment at https://studentaid.gov/understand-aid/types/loans/plus/grad#repayment-plans.
Disbursement of Funds
- Loan funds are applied to student accounts approximately ten days before the start of the semester.
- Half of the amount applied for is disbursed at the start of the fall semester and the other half at the start of the spring semester.
- Funds will first cover direct educational expenses on the student's account.
- Any excess funds are refunded to the student via ACH direct deposit or sent to the student's permanent address.
- Borrowers have the right to cancel all or a portion of the loan with no penalty by submitting a PLUS Loan Adjustment Request form within 14 days of disbursement.