New Federal Grad PLUS Loans Offered at Lower Interest Rate by Student Assistance Foundation

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Grad PLUS loans, which are eligible for student loan consolidation, can cover entire cost of graduate or professional school, including tuition, books, school supplies and living expenses.

As a result, many graduate students may no longer be using alternative loans for their post-baccalaureate work.

Student Assistance Foundation (SAF), a nonprofit organization that helps students nationwide finance and pursue post-secondary education, especially in the area of a student loan consolidation program, is making graduate and professional school goals reachable by offering the new Federal Grad PLUS loan at a lower interest rate than the U.S. government.

The fixed interest rate set by the government is 8.5 percent, whereas SAF can reduce rates to 7.75 percent or lower. Available only since July 1, 2006, the Grad PLUS loan makes graduate school an option for a broader range of students who would otherwise be forced to pay up to 50 percent of costs out-of-pocket, or finance additional expenses with a combination of loans.

“The Grad PLUS loan is the biggest change in graduate financial aid in nearly 15 years,” said Jim Stipcich, President of SAF. “As a result, many graduate students may no longer be using alternative loans for their post-baccalaureate work.”

Upon meeting certain on-time payment requirements, Grad PLUS borrowers of SAF will receive:

*Three percent of their original loan amounts returned to them as credits against their loan balances

*A 0.75 percent interest rate reduction immediately upon full disbursement of their loans

*An additional 0.50 percent interest rate reduction for using automated payment processing

*In-school deferments that postpone repayment until after graduation

The Grad PLUS loans can cover the entire cost of graduate or professional school, less other financial aid. Federal Stafford loans, one of the most common funding sources for undergraduate and graduate students, are offered at a lower interest rate than PLUS loans but can only be borrowed up to $18,500 per year. This is where the new Grad PLUS loan can make up the rest, including tuition, books, supplies and living expenses.

Formerly, PLUS loans were only available to undergraduate students and were to be handled and paid by their parents, as is evidenced in the full title, Parent Loan for Undergraduate Students. Grad PLUS loans are offered direct-to-students through SAF. Eligibility is largely dependent on the borrower’s credit rating and history. Also, the borrower must be a graduate or professional student enrolled at least part-time in a degree program and must have a valid Social Security number, be a U.S. citizen or eligible permanent resident. The FAFSA Financial Aid Application is also required.

To learn more about the new Grad PLUS loans offered by SAF, call 801-504-7324 or visit

About Student Assistant Foundation

The Student Assistance Foundation is a Montana-based, nonprofit organization that provides students and families nationwide with the knowledge and tools to finance and pursue post-secondary education. Student Assistance Foundation offers a wide range of programs including grants, community outreach, student loan consolidation, counseling and training on education finance planning.


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Jeannie Huntley
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