Low credit scores now accepted for PLUS loan

By Larry Ty Holmes, Opinion Editor

Last month, the Department of Education announced it has taken an extra step to ensure there will be wider access for the Parent Loan for Undergraduate Students.

The department has redefined “adverse credit history” to allow a wider applicant field. Since this definition hasn’t been updated for 20 years, the department wants to reflect the current economic situation for college students. This is a hard time for students who want an education but rely on obtaining loans so they can pursue a higher degree.

This change makes it easier for prospective graduate students to attain enough money to pursue their goals. As undergraduates get closer to graduating, we have to decide whether or not we want to continue our education. When that time comes, we’ll know the PLUS loan is easier to get.

The DOE designed the PLUS loan for students pursuing a “graduate or professional degree” and for “parents of dependent undergraduate students.” The purpose of the loan is to help students who have education expenses not paid for by other sources of financial aid, and the determination of the limit that a student can borrow is the difference between what a student needs and how much student already has; this is perfect for filling what students need.

“A threshold debt amount of $2,085, indexed to inflation, below which a potential borrower is considered to not have an adverse credit history,” is the final rule  published Oct. 23.

A couple of new changes that they made are defining terms to determine adverse credit history, reducing the time period of the borrower’s credit history from the last five years to the last two and allowing a PLUS loan by demonstrating “extenuating circumstances or by obtaining an eligible endorser.”  This here is what makes redefining the loan helpful for a lot of students.

The final regulations for PLUS loans are scheduled to take effect July 1, 2015 but are being implemented early by working with some colleges.

You can find this loan under the graduate and dependent application on the EWU website under Financial Aid and Scholarships.

Are you afraid to pay back your loans? – Easterner Asks