Back in 2013, the federal government removed the borrowing limits for Parent PLUS Loans. This meant parents could take out the full amount of their child’s college education in Parent PLUS Loans, which ultimately led to increased Parent PLUS loan debt. In fact, the average Parent PLUS Loan debt is around $29,600 according to a recent study. Parent PLUS Loan forgiveness can help you get rid of this debt.

Here’s what you need to know about Parent PLUS Loan forgiveness.

Do Parent PLUS Loans Qualify for Forgiveness? 

The answer is yes! There are several programs that offer Parent PLUS Loan forgiveness. 

Income-Contingent Repayment

The Income-Contingent Repayment (ICR) plan is a form of income-driven repayment for federal student loans. It’s typically a more affordable repayment option because your monthly payment is 20% of your discretionary income. Plus, you can get loan forgiveness after 25 years of payments.

Technically, Parent PLUS loans are ineligible for the Income-Contingent Repayment (ICR) plan. But if you were to consolidate your Parent PLUS Loans via a Direct Consolidation Loan, you would then qualify. Talk to your federal loan servicer about consolidation options and ICR plans. 

Public Service Loan Forgiveness for Parent PLUS Loans

The Public Service Loan Forgiveness (PSLF) Program will forgive the student debt of public service workers. You’re eligible as long as you work for a qualified employer and have made 120 on-time payments under an income-driven repayment plan. Your payments must have started after October 1, 2007.

Like the ICR plan, PSLF is only available for Direct Loans. But, you can always consolidate to be eligible. You can access the application for forgiveness through the PSLF Help tool. In addition to that, you’ll also have to submit an employer certification form when you apply. 

Military Forgiveness Programs

You might be able to get Parent PLUS Loan forgiveness if you’ve served or are currently serving in the military. But there are some programs that limit forgiveness to borrowers who took out loans on behalf of a student service member.

The exact loan amounts and requirements needed will depend on the program. So, talk to your loan servicer about military forgiveness options available to you.

Federal Agencies

Some federal agencies will offer Parent PLUS Loan forgiveness as an incentive to work for them. So, the employee of the agency has to be the borrower of the loans. For example, if you worked for the federal agency that has this option, you could use this benefit. But, if your child, the student, worked for the agency, you wouldn’t be able to do this. 

Other Options to Get Rid of a Parent PLUS Loan Faster 

If you can’t qualify for forgiveness, you still have other options to help pay off your PLUS Loans faster.  

Employer Student Loan Repayment Assistance

Certain employers may offer student loan repayment assistance programs (LRAP). If so, your employer will make monthly payments to your lender to help you to pay off your student loans quicker. Employers will have different policies on their LRAP when it comes to how much money they can pay or what loans are eligible. Talk to your employer about whether they offer a LRAP and their policies regarding it. 

Consider Refinancing

Student loan refinancing is the process of letting a private lender pay off your loans, whether they’re private or federal student loans. In doing so, they’ll give you a new private loan to pay them back, but with better loan terms. To be able to get those better terms, though, you’ll need at least a strong credit score and stable income.

Additionally, refinancing a federal loan will disqualify you from federal benefits. This means missing out on income-driven repayment plans or forgiveness programs. You’ll need to be sure of your decision before moving forward with this if you have federal loans. 

If you do decide to refinance your Parent PLUS Loans, you can get started by filling out the Sparrow application. The Sparrow application will match you with what refinance loans you qualify for from 15+ lenders. 

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Loan Discharge Programs

You may also be eligible for a discharge of your Parent PLUS Loans. Loan discharges free you from any obligation to finish paying back the loan. With federal discharge programs, you might even get reimbursement for payments. As a bonus, the discharge will be reported to credit bureaus, and any adverse credit history associated with your loans will be erased. 

Parent PLUS Loans can be discharged for several reasons, such as: 

  1. Death of a parent or a student on whose behalf the loans were borrowed 
  2. The parent becomes permanently and totally disabled 
  3. Bankruptcy discharge 
  4. Closed school discharge 
  5. False certification discharge 
  6. Identity theft discharge 
  7. Unpaid refund discharge 
  8. Defense to repayment discharge 

The amount discharged and the requirements to get a loan discharged is dependent on the program. Talk to your loan servicer for more information on loan discharge programs and which ones you qualify for. 

Final Thoughts from the Nest 

Although a lot of the information online may focus on the students, there are plenty of resources to help parents with Parent PLUS Loan forgiveness. If you don’t qualify for any of the Parent PLUS Loan forgiveness programs, consider refinancing with Sparrow. To get started, fill out the Sparrow application

Sparrow’s goal is to give you the tools and confidence you need to improve your finances. Many or all of the products featured here are from our partners who compensate us. This may influence which products we write about and where and how the product appears on a page. However, this does not influence our evaluations. Our opinions are our own. While we make an effort to include the best deals available to the general public, we make no warranty that such information represents all available products.

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