Key Takeaways:
- Qualifying parents can borrow direct PLUS Loans through the federal government or parent college loans through private lenders.
- Federal parent PLUS loans usually have more repayment options and lower interest rates than private options.
- You can apply for a PLUS loan on the FSA website, but you may have to complete a separate application with your child’s college.
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Most college loans are geared towards students, but there are two ways parents can borrow money for their child’s education – Direct PLUS Loans for Parents and private loans. Before you apply for either, you and your child should complete the Free Application for Federal Student Aid (FAFSA). However, if the financial aid package isn’t enough to cover the full cost of attendance, you might want to apply to one of these college loans for parents.
College Loans for Parents: Parent PLUS Loans
Direct PLUS Loans for Parents, commonly known as parent PLUS loans, are from the U.S. Department of Education and help parents pay for their children’s college education. Eligible parents can borrow money to cover expenses not covered by other financial aid sources, such as scholarships, federal student loans, and the Pell Grant.
Unlike student loans, where the student is responsible for paying back the money, parents are the sole borrowers of parent PLUS loans. As a result, they’re responsible for paying the loans back — not the child — and it can’t be later transferred to the student.
For the 2025-26 academic year, Parent PLUS loans have a 8.94% fixed interest rate over the lifetime of the loan. Parents also need to pay a loan fee. You can borrow up to the total cost of attendance minus any financial aid received.
If you qualify, the federal government will send the money to your student’s college to first be put towards tuition, room and board, and related expenses. If there’s any money left over, you can request they send the excess to you or your student to be used for other education costs.
Who Is Eligible?
Only biological parents, adoptive parents, and some step-parents can apply for parent PLUS loans. This doesn’t include grandparents or legal guardians, unless they’ve legally adopted the student.
In most cases, borrowers must pass a credit check. If you have an adverse credit history, you’ll need an endorser (a co-signer) or have extenuating circumstances that explain the credit history.
You also need to meet general requirements for federal student aid. A few examples include:
- The student must be enrolled at least half-time at an eligible institution.
- You and the student are U.S. citizens or eligible noncitizens with valid Social Security numbers.
- You demonstrate financial need.
How To Apply
You can apply for a Direct PLUS loan through the Federal Student Aid (FSA) website. Your student should have already completed their FAFSA beforehand. Some colleges also require additional, separate applications. You’ll need to sign a Master Promissory Note (MPN) if you’re eligible for the loan, agreeing that you’ll pay the money back.
How To Repay Parent PLUS Loans
You can start paying back these loans right away or request a deferment. If you request a deferment, you won’t have to make any payments until 6 months after your child graduates or leaves college. Interest accrues during this time.
Parents can also request extended repayment plans, income-contingent repayment plans, or loan consolidation. If you’re struggling to pay the money back, contact the Department of Education to review your deferment and forbearance options.
Are There Private Loans for Parents?
Yes, there are private loans for parents, including options specifically designed for helping children afford education costs. They’re offered through banks, credit unions, and other financial institutions. Interest rates and repayment terms vary depending on the lender, borrower’s credit history, and loan amount.
Compared to federal student loans for parents, private loans have fewer repayment options and safety nets. For example, only some lenders offer income-based plans. Private loans also tend to come with higher credit and income requirements, as well as higher interest rates.
In most cases, you should only take out private loans for your child’s education if you have maximized out all of your other options, including federal student loans.
Are Parents Responsible for Their Child’s Student Loans?
No, you are not responsible for paying back your child’s student loans. You’re only responsible for any Parent PLUS loans and private loans you take out in your name, including private student loans where you’re a co-signer.
Both parents and students need to complete the FAFSA. The FAFSA helps determine students’ eligibility for federal student loans, grants, institutional scholarships, and other forms of financial aid. Signing the FAFSA does not make you responsible for any federal student loans your child borrows.
If your child’s financial aid isn’t enough to cover their total cost of attendance, a Parent PLUS loan can help you close the gap. Private loans through lenders can also help you meet the cost.
Before taking out loans, compare your financial aid offer letters. They often come with or shortly after acceptance letters but since they don’t follow any single format, comparing them can be confusing. Use our Financial Aid Offer Comparison tool to find the best deal.
