In October 2011, the department changed it`s standards that are underwriting.

Charge-off records and reports in collections within 5 years, should they wasn’t paid back, would now count against candidates for PLUS loans.

The alteration had been made quietly — the division didn’t convene a rule-making panel or issue a page to universities describing it — however the effect had been dramatic, Kantrowitz stated. Some creditors will place approved cash loans records in collections in case a re re payment is 1 month later. Moms and dads that has formerly been qualified to receive the loans discovered that they had now been turned down.

Denials for PLUS loans jumped following the brand brand new requirement took effect, midway through the 2011-12 educational 12 months. Read more