What is a parent loan refinance?
What is a parent loan refinance?
When you refinance your Parent PLUS Loans, the process is similar to student loan refinancing. As the parent borrower, you obtain a new student loan at a lower interest rate and use the proceeds from the new loan to repay your existing Parent PLUS Loan.
Can my parents refinance my student loans?
You can refinance federal Parent PLUS and alternative student loans from private lenders, including loans you have cosigned. Some lenders offer no waiting period — parents can refinance while their kids are still in school.
What is the best way to consolidate Parent PLUS loans?
1. You could get Parent PLUS Loan forgiveness through Income-Contingent Repayment (ICR)
- Step 1: Apply for a Direct Consolidation Loan through StudentLoans.gov.
- Step 2: Talk to your loan servicer and choose ICR.
- Step 3: Make payments on time for 25 years to get your loans forgiven.
How long can Parent PLUS loans be deferred?
You can defer parent PLUS loans while your child is in school at least half-time and six months after. If you took out a federal parent PLUS loan for your child’s education, you don’t have to start paying it back right away.
How do I lower my parent PLUS loan interest rate?
You can refinance parent PLUS loans with a private lender, but not the federal government, to lower your interest rate. Depending on the lender, you can refinance the loan in your own name or transfer the loan to your child.
How long do you have to pay Parent PLUS loans?
Generally, you’ll have from 10 to 25 years to repay your loan, depending on the repayment plan that you choose. Your required monthly payment amount will vary depending on how much you borrowed, the interest rates on your loans, and your repayment plan.
Are Parent PLUS loans forgiven after 20 years?
Parent PLUS Loan Forgiveness with an Income-Contingent Repayment Plan (ICR) This is a federal program that can lower your monthly payments and offer loan forgiveness after 25 years for eligible applicants. Your loan will need to be consolidated by the Department of Education first to apply.
Who pays parent PLUS loans?
Only the parent borrower is required to pay back a Parent PLUS Loan, as only the parent signed the master promissory note for the Parent PLUS Loan. The student is not responsible for repaying a Parent PLUS Loan. They’re under no legal obligation to do so.
Is it wise to refinance a parent PLUS loan?
Refinancing parent PLUS loans may save you money by lowering your interest rate — rates start at about half of what the government charges for PLUS loans. It can also get you off the hook for the loan completely by transferring the debt to your child.