How are PLUS loan rates determined?

PLUS loan rates are decided when you first apply for your loan through the Free Application for Federal Student Aid. PLUS loan rates are the same for every individual who applies at a given time, and they do not depend on your credit or income. If your credit is too low, you will be denied a loan. Each year, the Department of Education can adjust PLUS loan interest rates to keep pace with the current economy. However, the rates you received when you took your original loan are fixed. Only rates going forward will change. 


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