Every month, HESC’s “Question and Answer” Web feature includes an interesting question presented to the Office of Counsel and Regulatory Compliance staff.

This month’s winning question:

FFEL lenders are required to determine the creditworthiness of an individual who is applying for a PLUS loan. An applicant is not eligible for a PLUS loan if a lender finds the applicant has an adverse credit history as specified in loan program regulations.

May a lender use additional criteria for determining PLUS loan eligibility?

Yes. A lender is responsible for developing and applying its own lending criteria in reviewing an applicant’s request for a PLUS loan, which may include credit standards that are more restrictive than those listed in program regulations.

A lender is required to apply its standards consistently to all PLUS loan applicants.

Information regarding a lender’s responsibilities in reviewing a PLUS application can be found in the Common Manual, Chapter 7, “Loan Origination”.

Direct questions regarding this guidance to the Office of Counsel and Regulatory Compliance at 518- 473-3986; or toll-free at 1-866-431-HESC (1-866-431-4372), press 6; or via email at askpolicy@hesc.org.