Estimated Financial Assistance and PLUS Loans

    During the recent training for schools on the implementation of the PLUS Master Promissory Note, a question arose about the definition of estimated financial assistance as it pertains to the certification of a PLUS loan.  The following clarification and summary of Department of Education (ED) regulations and instructions may be useful for program participants.

    The maximum annual/academic year PLUS amount allowed by federal regulations is the cost of education minus other estimated financial assistance [34 CFR 682.204(h) and (k)].  Estimated financial assistance is defined as, “the estimated amount of assistance for a period of enrollment that a student (or a parent on behalf of a student) will receive. . .” [§682.200].

    Prior to 1994-95, ED policy required the financial aid administrator to include the amount of  unsubsidized Federal Stafford Loan eligibility as estimated financial assistance for a Federal PLUS Loan, even if the student did not wish to apply for a Federal Stafford Loan.  ED changed that policy effective for loans certified for periods of enrollment that either began on or after July 1, 1994.  Under the revised policy, estimated financial assistance should not include unsubsidized Stafford loan eligibility unless the dependent student is requesting those funds. [1993-94 Federal Student Financial Aid Handbook, p. 10-69, Letter from ED to NASFAA, March 31, 1994 and 1994-95 FSFA Handbook, p. 10-72]

    At the time of certification of a PLUS loan only the aid that the student has applied for and been awarded, or expected to be awarded to and received by the student, should be considered as estimated financial assistance.

    Any questions related to this Bulletin should be directed to UHEAA Policy and Training at 801.321.7166 or by e-mail to mjohnson@utahsbr.edu.