This is one of the most common questions I receive almost every day – I can’t afford Parent PLUS loans, what should I do?
I’m a firm believer that parents should do this no Obtaining loans to pay for their children’s education. There are a lot of reasons why this is a bad idea, and I’m covering most of them My Forbes column.
The truth is, if you’re reading this article, it’s too late. You have already borrowed and now you are having difficulty paying it back. The most common way parents borrow money to pay for college is through Parent PLUS loans.
Sounds like a good idea – parents can get federal loans with all the great benefits students get. The problem is, This is wrong. In fact, Parent PLUS loans taken out after July 1, 2026 do not offer any type of income-based repayment plan and do not qualify for any type of student loan forgiveness program (well, again, that’s also accurate and we discuss it below).
In fact, the options are very limited with Parent Plus loans. You have some solutions, but refinancing your student loan or working together as a family are usually your best bets. If you’re considering refinancing, we recommend it reasonable. There are some lenders that will allow you to refinance your Parent PLUS loan in your child’s name. Check credibility here, and if you refinance, get a bonus of up to $1,000!
Myths of Parent PLUS Loan Payment Plans
First, there are a lot of nuances surrounding what you can and cannot do with Parent PLUS loans. The answer to what is possible depends on when you get the loan.
If you borrowed a Parent PLUS loan before June 30, 2026 and never borrow a student loan again, you will likely have access to IBR and PSLF. You must consolidate your Parent PLUS loans and enroll in an income-driven repayment plan before the June 30 deadline.
If you took out Parent PLUS loans after July 1, 2026, You cannot:
- Qualifying for Income-Based Repayment (IBR)
- Qualify for Public Service Loan Forgiveness
The only payment option will be the standard payment plan.
Options to lower parent loan payments additionally
The options for lowering your payments again depend on when you borrow the loans.
Rules for borrowers with loans before June 30, 2026:
- EPR: If you consolidate your loan before June 30, 2026, and enroll in an income-driven repayment plan, you will have access to IBR from now on.
- graduation: Graduated payments start with monthly payments that are at or slightly above the interest-only payment and the monthly payment increases every two years. The final payment is no more than three times the first payment.
- extended: Extended repayment extends the repayment term to 12, 15, 20, 25 or 30 years, depending on the amount owed. This will lower your monthly payments to be equal over the new loan term.
Rules for borrowers after July 1, 2026:
If you borrow after July 1, 2026 (any federal student loan), you will only be allowed to repay a Parent PLUS loan through the Standard Plan.
There are no additional options to lower your monthly payment with federal programs.
Refinance your loan
Second, you can refinance your Parent PLUS loan into a private student loan. Private loans typically offer lower payments and lower interest rates, however, many of these lower rates are variable and can rise over time. But for many, the much lower payout offsets any potential future upside.
We partner with reasonable To help people refinance their student loans. Credible is a comparison tool that allows you to compare prices in less than two minutes. No credit check! As a bonus, College Investor readers can get a $1,000 bonus when they do this Refinance reliably.
Get started now and see if you can save money by refinancing your loan with Credible.
Parent plus student loan refinancing
For borrowers with Parent PLUS loans who have good credit, one of the best options (if you can afford it and don’t qualify for student loan forgiveness) is to refinance your student loan. Refinancing allows you to get a lower interest rate or a lower payment than you currently have.
We break down the best places to refinance your student loans here, and we also recommend Credible as your first stop for refinancing your loans.
Some lenders have a unique program through which you can refinance your Parent PLUS loan from the parent’s name to the student’s name. Parents may still have to co-sign, but these programs also have a co-sign release after a certain number of on-time payments. This is a great program to take the burden off the parents and put it on the student (who received the benefits initially).
Lenders who offer this include:
Select ku
CU Select is another lender (group of lenders) that allows you to refinance your Parent PLUS loans in the student’s name.
CU Select is a network of credit unions that all offer student loans through the CU Select platform. Since these are credit unions, they are a little more flexible when it comes to setting up different loans.
Check CU select here.
LendKey
LendKey is the third major lender that allows you to refinance your student loans from the parent’s name to the student’s name. They also have very competitive rates and terms for borrowers.
To start the process, Child/student Must go to LendKey And choose “Apply Now”. They should have the loan information and documents related to your Parent PLUS loan at their fingertips when going through this process.
Check out LendKey here.
Traditional deferrals, forbearances and cancellations remain in effect
For Parent PLUS loans, borrowers still have the option to apply for deferment, forbearance, and student loan cancellation.
Deferment and forbearance are temporary ways to stop making your student loan payments. You can read more about postponement and forgiveness here.
Parent PLUS loans can also be eligible for student loan forgiveness, which is different from student loan forgiveness (we explain the difference here). If you are completely and permanently disabled, or the loan was obtained under fraudulent circumstances, the loan may be cancelled.
Note: Deferral and forbearance options change in 2027.
Consider getting professional help
In all my time working with student loan debt, dealing with Parent PLUS loans is by far the worst. They don’t offer as many options as other types of loans, and when parents struggle with their debt, it can hurt the entire family.
The best place to get help with your loans is to contact your lender and work with them. You can also go online at StudentLoans.gov and do many things about your loan, including changing your repayment plan.
If you’re not quite sure where to start or what to do, consider hiring a CFA to help you with your student loans. We recommend using our Student Loan Planner to help you create a solid financial plan for your student loan debt. Payment Student loan scheme here.
Talk to your family
Finally, it never hurts to talk about your student loan debt situation with your family. Remember, you took out these student loans to help your child pay for their college education. After graduation, the hope is that your child will earn more and be in good financial standing.
We never recommend that parents ask their children to repay a Parent PLUS loan because it is ridiculous from an estate planning perspective and potentially harmful to “steal” money from your children in the prime of their lives when you probably don’t need it. We see many situations where parents make their children struggle financially during their prime years (22-40), only to be given the inheritance when the child turns 60… How is that helpful?
The exception, of course, is if you would be destitute without their help.
While no parent wants to burden their children, being buried by student loan debt can be damaging. You may not be a burden on your children now, but if you can’t afford retirement because your Social Security is being garnished to pay off debt, you could end up needing more support in the future.
Regardless, your children should know your financial situation, especially if you can’t make the payments on your Parent PLUS loan.
Final thoughts
Parent PLUS loans are the worst student loans, and we highly recommend avoiding them if possible. If you’re already reading this, it’s probably too late. As such, really focus on working together as a family to pay off the loans, and see if refinancing them makes sense.
Are you struggling with your Parent PLUS loans?
