Subchapter H. FEDERAL PLUS PROGRAM
Sec.
121.131. Submission and processing of applications.
121.132. Lender eligibility.
121.133. [Reserved].
121.134. Loan insurance premium.
121.135. Federal PLUS Loan guaranty limits.
121.136. [Reserved].
121.137. Repayment.
121.138. Student on probation.
121.139. Cancelled debt.
121.140. Default.
121.141. Loan residency.
121.142. Co-maker/co-signer.
Authority The provisions of this Subchapter H issued under act of July 12, 1981 (P. L. 264, No. 89) (24 P. S. § § 5102.1 and 5104(1.2)), unless otherwise noted.
Source The provisions of this Subchapter H adopted August 7, 1981, effective August 8, 1981, 11 Pa.B. 2760, unless otherwise noted.
§ 121.131. Submission and processing of applications.
(a) Applicant. A parent of a dependent student desiring to secure a guaranty of a Federal PLUS Loan shall obtain from a participating lender, a participating school or Agency a loan application packet containing the application/promissory note form for the Federal PLUS Loan. The information provided on the form will be used to determine the eligibility of the applicant to receive a PHEAA Federal PLUS Loan. The student for whom the loan funds shall be used to meet educational expenses shall complete the information requested on the student’s portion of the Federal PLUS Loan application, including the affidavit in which the student authorizes the school and the lender named on the Federal PLUS Loan application form to release information contained in the student’s file that is relevant to the eligibility of the student for the Federal PLUS Loan Program. The applicant shall complete the appropriate section of the application, including the affidavit in which the applicant agrees to use the loan proceeds solely for the educational expenses of the student named in the application. The applicant shall also read, sign and date the promissory note included on the loan application form. After completing the appropriate section of the Federal PLUS Loan application form, the applicant shall retain one copy of the form and forward the remaining copies of the application/promissory note form as referenced on the form.
(b) Educational institution. The institution shall certify the Federal PLUS Loan application according to the instructions provided by the Agency.
(c) Processing by the Agency. The Agency will check the application/promissory note form for completeness. If not complete, the Agency will obtain from the applicant the missing data items.
(d) Completion of processing. Upon receipt of missing information, the Agency will complete the processing of the loan application and determine the amount of loan assistance the borrower is entitled to obtain. The Agency will inform the lender of the amount of the guaranty by sending the lender the appropriate Loan Guaranty Notice and Disclosure Statement.
(e) Action by lender. The lender shall provide the applicant with a copy of the Loan Guaranty Notice and Disclosure Statement and disburse the funds by means of a check or electronic funds transfer. If the lender does not wish to make the loan, the lender shall mark ‘‘Denied’’ on the Loan Guaranty Notice and Disclosure Statement or report the denial of the loan by the computer terminal. An adverse action notice shall be provided to the borrower by the lender if loan assistance is denied.
Authority The provisions of this § 121.131 amended under section 4 of the act of August 7, 1963 (P. L. 549, No. 290) (24 P. S. § 5104); section 1 of the act of January 25, 1966 (P. L. 1546, No. 541) (24 P. S. § 5151); the act of July 18, 1974 (P. L. 483, No. 174) (24 P. S. § § 5181—5189); the act of July 1, 1988 (P. L. 1259, No. 155) (24 P. S. § § 5191—5197); and the act of June 26, 1992 (P. L. 322, No. 64) (24 P. S. § § 5198.1—5198.7).
Source The provisions of this § 121.131 adopted August 7, 1981, effective August 8, 1981, 11 Pa.B. 2760; corrected August 22, 1981, 11 Pa.B. 2911; amended March 26, 1982, effective March 27, 1982, 12 Pa.B. 1043; amended January 16, 1987, effective January 17, 1987, 17 Pa.B. 250; amended October 16, 1987, effective October 17, 1987, 17 Pa.B. 4120; amended July 12, 1996, effective July 13, 1996, 26 Pa.B. 3321. Immediately preceding text appears at serial pages (161848) to (161849).
§ 121.132. Lender eligibility.
A bank, Federal or State savings and loan association, mutual savings bank, Federal or State credit union or other approved lender which executes a Lender Participation Agreement with the Agency and an Agreement for Participation in the guaranteed loan program with the United States Secretary of Education shall become an eligible lender.
§ 121.133. [Reserved].
Source The provisions of this § 121.133 adopted August 7, 1981, effective August 8, 1981, 11 Pa.B. 2760; corrected August 22, 1981, 11 Pa.B. 2911; amended January 16, 1987, effective January 17, 1987, 17 Pa.B. 249; amended October 16, 1987, effective October 17, 1987, 17 Pa.B. 4120; reserved October 4, 1991, effective October 5, 1991, 21 Pa.B. 4633. Immediately preceding text appears at serial page (138281).
§ 121.134. Loan insurance premium.
A borrower shall, at the option of the Agency, pay to the lender, at the time the borrower obtains the loan, a loan insurance premium calculated as a percentage of the loan guaranty amount. The percentage used cannot exceed the rate mandated by Federal law and regulations.
Authority The provisions of this § 121.134 amended under section 4 of the act of August 7, 1963 (P. L. 549, No. 290) (24 P. S. § 5104).
Source The provisions of this § 121.134 adopted August 7, 1981, effective August 8, 1981, 11 Pa.B. 2760; corrected August 22, 1981, 11 Pa.B. 2911; amended March 26, 1982, effective March 27, 1982, 12 Pa.B. 1043; amended March 4, 1983, effective March 5, 1983, 13 Pa.B. 887; amended January 16, 1987, effective January 17, 1987, 17 Pa.B. 249; amended July 22, 1988, effective July 23, 1988, 18 Pa.B. 3206. Immediately preceding text appears at serial pages (121702) to (121703).
§ 121.135. Federal PLUS Loan guaranty limits.
The Agency will guarantee a Federal PLUS Loan for the difference between cost minus other financial assistance.
Authority The provisions of this § 121.135 issued and amended under section 4 of the act of August 7, 1963 (P. L. 549, No. 290) (24 P. S. § 5104); section 1 of the act of January 25, 1966 (P. L. 1546, No. 541) (24 P. S. § 5151); the act of July 18, 1974 (P. L. 483, No. 174) (24 P. S. § § 5181—5189); the act of July 1, 1988 (P. L. 1259, No. 155) (24 P. S. § § 5191—5197); and the act of June 26, 1992 (P. L. 322, No. 64) (24 P. S. § § 5198.1—5198.7).
Source The provisions of this § 121.135 adopted August 7, 1981, effective August 8, 1981, 11 Pa.B. 2760; amended September 21, 1984, effective September 22, 1984, 14 Pa.B. 3426; amended October 16, 1987, effective October 17, 1987, 17 Pa.B. 4120; amended October 4, 1991, effective October 5, 1991, 21 Pa.B. 4637; amended July 12, 1996, effective July 13, 1996, 26 Pa.B. 3321. Immediately preceding text appears at serial pages (161850) to (161851).
§ 121.136. [Reserved].
Source The provisions of this § 121.136 adopted August 7, 1981, effective August 8, 1981, 11 Pa.B. 2760; corrected August 22, 1981, 11 Pa.B. 2911; amended March 26, 1982, effective March 27, 1982, 12 Pa.B. 1043; amended October 16, 1987, effective October 17, 1987, 17 Pa.B. 4120; amended July 12, 1996, effective July 13, 1996, 26 Pa.B. 3321. Immediately preceding text appears at serial pages (161851) to (161852).
§ 121.137. Repayment.
(a) A Federal PLUS Loan is due for repayment within 60 days of the date of the final disbursement of the loan.
(b) A borrower shall repay in substantially equal monthly installment payments at least $600 per year, including principal and interest. If the total of the insured loans would not be repaid in less time with minimum payments of $600 per year, the repayment schedule shall provide for repayment in not less than 5 years, nor more than 10 years. The lender and the borrower may agree to monthly payments of less than $50 over not more than a 10-year repayment schedule.
(c) Upon proper notice to the lender, repayment of principal may be deferred in accordance with, and during periods specified in, the Higher Education Act of 1965 (Pub. L. No. 89-329, 79 Stat. 1219) and Federal regulations based on this act. The borrower is responsible for the interest that accrues during any period principal repayment is deferred.
Authority The provisions of this § 121.137 amended under section 4 of the act of August 7, 1963 (P. L. 549, No. 290) (24 P. S. § 5104); section 1 of the act of January 25, 1966 (P. L. 1546, No. 541) (24 P. S. § 5151); the act of July 18, 1974 (P. L. 483, No. 174) (24 P. S. § § 5181—5189); the act of July 1, 1988 (P. L. 1259, No. 155) (24 P. S. § § 5191—5197); and the act of June 26, 1992 (P. L. 322, No. 64) (24 P. S. § § 5198.1—5198.7).
Source The provisions of this § 121.137 adopted August 7, 1981, effective August 8, 1981, 11 Pa.B. 2760; corrected August 22, 1981, 11 Pa.B. 2911; amended March 26, 1982, effective March 27, 1982, 12 Pa.B. 1043; amended January 16, 1987, effective January 17, 1987, 17 Pa.B. 249; amended July 22, 1988, effective July 23, 1988, 18 Pa.B. 3208; amended June 9, 1989, effective June 10, 1989, 19 Pa.B. 2428; amended October 4, 1991, effective October 5, 1991, 21 Pa.B. 4637; amended July 12, 1996, effective July 13, 1996, 26 Pa.B. 3321. Immediately preceding text appears at serial pages (161852) to (161853).
Cross References This section cited in 22 Pa. Code § 121.140 (relating to default); and 22 Pa. Code § 121.142 (relating to co-maker/co-signer).
§ 121.138. Student on probation.
A student borrower or a student for whom a parent has borrowed placed on academic or disciplinary probation shall remain eligible for a PLUS/Supplemental Loans for Students loan guaranty if the institution of higher learning permits the student to continue studies on at least a half-time basis.
Authority The provisions of this § 121.138 amended under section 4 of the act of August 7, 1963 (P. L. 549, No. 290) (24 P. S. § 5104); and section 1 of the act of January 25, 1966 (P. L. 1546, No. 541) (24 P. S. § 5151).
Source The provisions of this § 121.138 adopted August 7, 1981, effective August 8, 1981, 11 Pa.B. 2760; amended March 26, 1982, effective March 27, 1982, 12 Pa.B. 1043; amended October 16, 1987, effective October 17, 1987, 17 Pa.B. 4120. Immediately preceding text appears at serial page (114227).
§ 121.139. Cancelled debt.
The obligation to repay the indebtedness of a Federal PLUS Loan borrower who dies, who becomes totally and permanently disabled, whose loans are discharged in bankruptcy or who has his eligibility to borrow falsely certified by the school, shall be cancelled upon the acceptance of proper documentation by the lender or holder of the loan. The obligation to repay the indebtedness of a Federal PLUS Loan borrower shall be cancelled upon the acceptance of proper documentation by the lender or holder of the loan of the death of the student on whose behalf the parent borrowed the Federal PLUS Loan or closure of the school at which the student on whose behalf the parent borrowed the Federal PLUS loan is enrolled.
Authority The provisions of this § 121.139 amended under section 4 of the act of August 7, 1963 (P. L. 549, No. 290) (24 P. S. § 5104); section 1 of the act of January 25, 1966 (P. L. 1546, No. 541) (24 P. S. § 5151); the act of July 18, 1974 (P. L. 483, No. 174) (24 P. S. § § 5181—5189); the act of July 1, 1988 (P. L. 1259, No. 155) (24 P. S. § § 5191—5197); and the act of June 26, 1992 (P. L. 322, No. 64) (24 P. S. § § 5198.1—5198.7).
Source The provisions of this § 121.139 adopted August 7, 1981, effective August 8, 1981, 11 Pa.B. 2760; corrected August 22, 1981, 11 Pa.B. 2911; amended March 26, 1982, effective March 27, 1982, 12 Pa.B. 1043; amended October 16, 1987, effective October 17, 1987, 17 Pa.B. 4120; amended July 12, 1996, effective July 13, 1996, 26 Pa.B. 3321. Immediately preceding text appears at serial page (161854).
Cross References This section cited in 22 Pa. Code § 121.142 (relating to co-maker/co-signer).
§ 121.140. Default.
Except as otherwise provided in § 121.137 (relating to repayment), a note shall be declared in default at the following times:
(1) One hundred eighty days after the date on which a monthly payment was scheduled to be made by the borrower under a repayment schedule, if the borrower fails to make the monthly payment within 180 days after its due date.
(2) Two hundred forty days after the date on which a quarterly payment of interest was scheduled to be made by the borrower under a quarterly interest payment schedule, if the borrower fails to make the quarterly payment within 240 days after its due date.
Authority The provisions of this § 121.140 amended under section 4 of the act of August 7, 1963 (P. L. 549, No. 290) (24 P. S. § 5104); section 1 of the act of January 25, 1966 (P. L. 1546, No. 541) (24 P. S. § 5151); the act of July 18, 1974 (P. L. 483, No. 174) (24 P. S. § § 5181—5189); the act of July 1, 1988 (P. L. 1259, No. 155) (24 P. S. § § 5191—5197); and the act of June 26, 1992 (P. L. 322, No. 64) (24 P. S. § § 5198.1—5198.7).
Source The provisions of this § 121.40 adopted August 7, 1981, effective August 8, 1981, 11 Pa.B. 2760; amended March 26, 1982, effective March 27, 1982, 12 Pa.B. 1043; amended July 12, 1996, effective July 13, 1996, 26 Pa.B. 3321. Immediately preceding text appears at serial page (161854).
§ 121.141. Loan residency.
(a) A parent applicant shall, at the time the parent applies for a Federal PLUS Loan or to renew a Federal PLUS Loan guaranty, be a resident of this Commonwealth. The parent applicant, to be considered a resident of this Commonwealth, shall be the parent of a student who is accepted for enrollment in or is attending an approved institution of higher education located in this Commonwealth. In the case of the parent of a student who is enrolled in or attending a non-Pennsylvania school or participating in a correspondence (home study) course through a Pennsylvania institution, the parent applicant shall be a bona fide domiciliary of this Commonwealth for at least 30 days immediately preceding the date of receipt by the Agency of the Federal PLUS Loan application to obtain a loan for such a student.
(b) For purposes of determining domicile, a guardian is:
(1) A person appointed by a court.
(2) A person other than a parent with whom the applicant has lived and in whose continuous direct care and control the applicant has been for at least 2 years.
(c) Military status of persons and their dependents who reside in the civilian community rather than on a military installation may not alone be grounds for determining an applicant ineligible.
(d) Persons and their dependents who leave this Commonwealth on military or foreign assignments, such as missionaries, United States military service personnel and representatives of domestic companies or government agencies, shall be presumed to maintain their domicile in this Commonwealth for the purposes of satisfying the Federal PLUS Loan guaranty residency requirement.
(e) In the case of a parent borrower who moves from this Commonwealth after the Agency has issued a loan guaranty for the academic year for a student attending an institution of higher education in another state, the loan guaranty eligibility of the applicant shall continue to the end of the student’s program of study.
(f) If a student transfers to an approved institution located outside of this Commonwealth after the borrower for the student has received loan assistance while the student was attending a Commonwealth institution of higher education, the borrower for the student is eligible to have the loan assistance renewed.
(g) The Agency will make the final decision in all matters pertaining to residency or domicile, or both.
Authority The provisions of this § 121.141 amended under section 4 of the act of August 7, 1963 (P. L. 549, No. 290) (24 P. S. § 5104); section 1 of the act of January 25, 1966 (P. L. 1546, No. 541) (24 P. S. § 5151); the act of July 18, 1974 (P. L. 483, No. 174) (24 P. S. § § 5181—5189); the act of July 1, 1988 (P. L. 1259, No. 155) (24 P. S. § § 5191—5197); and the act of June 26, 1992 (P. L. 322, No. 64) (24 P. S. § § 5198.1—5198.7).
Source The provisions of this § 121.141 adopted August 7, 1981, effective August 8, 1981, 11 Pa.B. 2760; corrected August 22, 1981, 11 Pa.B. 2911; amended January 16, 1987, effective January 17, 1987, 17 Pa.B. 249; amended October 16, 1987, effective October 17, 1987, 17 Pa.B. 4120; amended July 12, 1996, effective July 13, 1996, 26 Pa.B. 3321. Immediately preceding text appears at serial pages (161854) to (161856).
§ 121.142. Co-maker/co-signer.
(a) Co-makers. Two eligible borrowers may take out one loan on behalf of one student under the Federal PLUS Loan Program. As co-makers, both borrowers shall meet the eligibility criteria, both borrowers are equally liable for the repayment of the loan and both must qualify in order for any special benefits associated with the loan, such as deferment or cancellation, to be received.
(b) Co-signers. A borrower may have another party as a co-signer to a Federal PLUS Loan. The borrower assumes the primary liability and is fully responsible for repaying the debt. The co-signer is secondary liable. Only if the person with primary liability fails to honor the repayment obligation shall the lender attempt to collect from the co-signer. The co-signer does not have to be an eligible borrower. If the borrower qualifies for a deferment under § 121.137 (relating to repayment) or cancellation under § 121.139 (relating to cancelled debt), the loan is deferred or cancelled. A co-signer who signs the Federal PLUS Loan Promissory Note is not eligible for deferment or cancellation.
Authority The provisions of this § 121.142 amended under section 4 of the act of August 7, 1963 (P. L. 549, No. 290) (24 P. S. § 5104); section 1 of the act of January 25, 1966 (P. L. 1546, No. 541) (24 P. S. § 5151); the act of July 18, 1974 (P. L. 483, No. 174) (24 P. S. § § 5181—5189); the act of July 1, 1988 (P. L. 1259, No. 155) (24 P. S. § § 5191—5197); and the act of June 26, 1992 (P. L. 322, No. 64) (24 P. S. § § 5198.1—5198.7).
Source The provisions of this § 121.142 adopted August 7, 1981, effective August 8, 1981, 11 Pa.B. 2760; amended March 26, 1982, effective March 27, 1982, 12 Pa.B. 1043; amended October 16, 1987, effective October 17, 1987, 17 Pa.B. 4120; amended July 12, 1996, effective July 13, 1996, 26 Pa.B. 3321. Immediately preceding text appears at serial pages (161856) to (161857).
No part of the information on this site may be reproduced for profit or sold for profit.
This material has been drawn directly from the official Pennsylvania Code full text database. Due to the limitations of HTML or differences in display capabilities of different browsers, this version may differ slightly from the official printed version.
