Purpose

• The endorser addendum works as a co-signer contract for the Direct PLUS loan, ensuring payment to the federal government in the event that the borrower does not pay. The borrower may be a graduate student, professional student or a parent. If the borrower does not pay, the federal government looks to you, the co-signer who signs the endorser addendum, to pay the loan.
  
  

Repayment

• The parent or borrower starts paying the loan 60 days after the student is no longer a half-time student. The borrower can request a deferment to extend the start date of the loan to six months after the student is no longer a half-time student. The borrower has years to repay the loan. Other master promissory notes signed by the parent or student will not affect this loan. The total amount of your potential obligation is the principal amount shown on the endorser addendum plus interest, potential late charges and collection costs. The entire amount may become due in case of default as the contract has an acceleration clause.
  
  

Forbearance and Discharge

• The borrower may receive a deferment but a deferment is not available to the endorser. An endorser or borrower may receive forbearance or postponement from making payments. If the Department of Education discharges or cancels the loan, the endorser is no longer obligated. If the student dies or you die, you can escape the loan repayment. If you declare bankruptcy, you must show undue hardship to the bankruptcy court to have a PLUS loan dismissed in bankruptcy. Under some circumstances of total and permanent disability, you may have the loan obligation discharged.
  
  

Effect

• If the parent or borrower fails to pay the PLUS loan, the U.S. Department of Education may report the default to credit reporting agencies under your name. An endorser addendum has the potential for lowering your credit score. The Department of Education can file a lawsuit against you or garnish your wages as if you were the borrower. You do not have the same rights and responsibilities as the original borrower. You must notify the Direct Loan Servicing Center if you change your address or your name. If you are making payments on the loan, you can contact the Direct Loan Servicing Center and request a change of repayment plans.