The U.S. Department of Education announced the publication of a final rule to strengthen the Federal Direct PLUS Loan Program. The new rule will help more students and families pay for college, and ensure they have the tools and resources to make informed decisions about financing their educational pursuits, the agency announced.
In addition, the new regulations will both expand student access to postsecondary education and safeguard taxpayer dollars by reflecting economic and programmatic changes that have occurred since the program was established more than 20 years ago, according to the agency.
"The Department's top priority is to ensure more students can access and successfully complete a postsecondary education," said U.S. Secretary of Education Arne Duncan. "The updated borrowing standards for the PLUS loan program demonstrate our commitment to ensuring families have access to the financing they need to reach their goal, while being good stewards of taxpayer money."
The final regulations update the definition of "adverse credit history" for PLUS loan applicants, and implement a streamlined application process for borrowers to obtain a PLUS loan, specifically for those with adverse credit histories. Economic conditions have changed considerably in the last 20 years, and this update will ensure the regulations reflect current circumstances.
The DOE also is taking action to provide families with clear, customized information about their loan obligations to support their college financing decisions and ensure their loan debt stays manageable.
Finally, to provide more transparency in the PLUS loan program, the DOE will also collect and, where appropriate, publish information about the performance of PLUS loans, including default rate information based on credit history characteristics of PLUS loan borrowers and individual institutional default rates, according to the DOE.
