Best Parent Loans for College: Parent PLUS and Private
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Parents planning to borrow for a student's education have two options: Parent PLUS loans, which are federal student loans issued to parents, and private loans offered by banks and online lenders.
Here are our picks for the best parent student loans and information on financing your child's education.
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Why trust NerdWallet
- 35+ student loans lenders reviewed and rated by our team of experts.
- 10+ years of combined experience covering higher education and student loans.
- Objective, comprehensive star-rating system assessing 43 categories and 40+ data points across student loan origination and student loan refinance.
- Governed by NerdWallet's strict guidelines for editorial integrity.
Best Parent Loans for College: Parent PLUS and Private
Lender | NerdWallet Rating | Min. credit score | Fixed APR | Variable APR | Learn more |
|---|---|---|---|---|---|
5.0 /5 | None | 9.08-9.08% | N/A | ||
5.0 /5 | Mid-600s | 3.47-17.99% | 3.47-17.99% | Check rate on College Ave's website | |
4.0 /5 | 660 | 5.40-15.91% | 5.80-15.51% |
Our pick for
Federal loan option for parents
Federal parent PLUS loans have fixed interest rates and minimal fees. Parent borrowers must not have any adverse credit history to qualify.
- Key facts
Federal PLUS loans are available to parents of undergrads as well as graduate students. They are best for parents who may need the safety net they offer, like income-contingent repayment after consolidation, and for grad students who have hit limits on lower-interest unsubsidized loans.
Pros- More flexible repayment options for struggling borrowers compared with private lenders.
- All borrowers who attend a school authorized to receive federal aid can qualify.
Cons- May have higher interest rates compared with private lenders.
- You pay an origination fee.
- You can’t see if you’ll qualify without a hard credit check.
Qualifications- Parent PLUS loan borrowers must not have adverse credit history.
- Borrowers with adverse credit history can still receive a parent PLUS loan by enlisting a co-signer without adverse credit history or documenting extenuating circumstances for their credit history.
- Loan amounts: Total cost of attendance minus other financial aid.
Available Term Lengths10 to 25 years once repayment begins, depending on the repayment plan.
Our pick for
Private parent loans for college
College Ave Parent Student Loan
Mid-600s
3.47-17.99%
3.47-17.99%
- Key facts
Best for parents who want to help manage some of their student's spending.
Pros- You can see if you’ll qualify and what rate you’ll get without a hard credit check.
- You can choose your monthly payment while the student is in school, provided it covers at least the interest.
Cons- No co-signer option.
- Estate is still responsible for the loan if the parent borrower dies.
Qualifications- Typical credit score of approved borrowers: Mid-700s.
- Minimum income: $70,000 per year.
- Loan amounts: $1,000 up to school-certified cost of attendance.
Available Term LengthsBetween 5 and 15 years.DisclaimerCollege Ave Student Loans products are made available through Firstrust Bank, member FDIC, First Citizens Community Bank, member FDIC, or M.Y. Safra Bank, FSB, member FDIC. All loans are subject to individual approval and adherence to underwriting guidelines. Program restrictions, other terms, and conditions apply. (1)All rates include the auto-pay discount. The 0.25% auto-pay interest rate reduction applies as long as a valid bank account is designated for required monthly payments. If a payment is returned, you will lose this benefit. Variable rates may increase after consummation. (2)As certified by your school and less any other financial aid you might receive. Minimum $1,000. (3)This informational repayment example uses typical loan terms for a freshman borrower who selects the Flat Repayment Option with an 8-year repayment term, has a $10,000 loan that is disbursed in one disbursement and a 7.78% fixed Annual Percentage Rate (“APR”): 54 monthly payments of $25 while in school, followed by 96 monthly payments of $176.21 while in the repayment period, for a total amount of payments of $18,266.38. Loans will never have a full principal and interest monthly payment of less than $50. Your actual rates and repayment terms may vary. Information advertised valid as of 3/3/2025. Variable interest rates may increase after consummation. Approved interest rate will depend on creditworthiness of the applicant(s), lowest advertised rates only available to the most creditworthy applicants and require selection of full principal and interest payments with the shortest available loan term.
Ascent Parent Loan
660
5.40-15.91%
5.80-15.51%
- Key factsBest for parents who want to support a student who is not enrolled in school at least half-time.Pros
- Offers loans to parents with students who are enrolled less than half-time.
- Allows bi-weekly payments via autopay.
Cons- No co-signer option.
- The parent or borrower’s estate still has to cover loan payments if the parent borrower dies.
QualificationsDisclaimerAscent’s undergraduate and graduate student loans are funded by Bank of Lake Mills or DR Bank, each Member FDIC. Loan products may not be available in certain jurisdictions. Certain restrictions, limitations, terms and conditions may apply. For Ascent's Terms and Conditions please visit: AscentFunding.com/Ts&Cs. Annual Percentage Rates (APRs) displayed above are effective as of 5/1/2025 and reflect an Automatic Payment Discount of 0.25% for credit-based college student loans and 1.00% discount on outcomes-based loans when you enroll in automatic payments. The Full P&I (Immediate) Repayment option is only available for college loans (except for outcomes-based loans) originated on or after June 3, 2024. For more information, see repayment examples ( visit https://www.ascentfunding.com/annual-percentage-rate-apr-sample/) or review the Ascent Student Loans Terms and Conditions. The final amount approved depends on the borrower’s credit history, verifiable cost of attendance as certified by an eligible school, and is subject to credit approval and verification of application information. Lowest interest rates require full principal and interest (Immediate) payments, the shortest loan term, a cosigner, and are only available for our most creditworthy applicants and cosigners with the highest average credit scores. Actual APR offered may be higher or lower than the examples above, based on the amount of time you spend in school and any grace period you have before repayment begins. 1% Cash Back Graduation Reward subject to terms and conditions. For details on Ascent borrower benefits, visit AscentFunding.com/BorrowerBenefits. The AscentUP platform is only available to eligible Ascent borrowers and subject to terms and conditions.
ISL Private Student Loan
660
3.95-8.01%
6.54-11.08%
- Key facts
Best for parents seeking low-interest loans with consumer-friendly features, like a generous forbearance policy.
Pros- Forbearance of 24 months is longer than many lenders offer.
- No late fees.
Cons- Only offers 2 loan terms.
Qualifications- Typical credit score of approved borrowers or co-signers: 670.
- Minimum income: No minimum income.
- Loan amounts: $1,001 or $2,001, based on residency and school location, up to cost of attendance minus other aid received.
Available Term Lengths10 or 15
RISLA Private Student Loan
680
4.05-8.64%
N/A
- Key facts
Best for parents who want to reduce their child's debt levels.
Pros- Income-based repayment plan available, with forgiveness after 25 years.
- You can see if you’ll qualify and what rate you’ll get without a hard credit check.
- Partial loan forgiveness for eligible internships; interest forgiveness for qualifying nurses.
Cons- Fewer repayment terms available than other lenders.
Qualifications- Typical credit score of approved borrowers: 768.
- Minimum income: $40,000.
- Loan amounts: $1,500 to $45,000.
Available Term Lengths10 or 15 years
SoFi Parent Loan
Mid-600s
5.74-15.99%
6.07-15.99%
- Key factsBest for flexible repayment options and no fees.Pros
- You can see if you’ll qualify and what rate you’ll get without a hard credit check.
- Multiple in-school repayment options available, including interest-only and flat-fee, and deferred for undergrad and grad students.
Cons- Does not offer bi-weekly payments via autopay.
QualificationsAvailable Term Lengths5, 7, 10, 15 yearsDisclaimerInterest Rates: Eligibility and Important Details. Fixed rates range from 5.74% APR to 15.99% APR with 0.25% autopay discount. Variable rates range from 6.07% APR to 15.99% APR with a 0.25% autopay discount. Unless required to be lower to comply with applicable law, Variable Interest rates are capped at 17.95%. SoFi rate ranges are current as of 11/20/24 and are subject to change at any time. Your actual rate will be within the range of rates listed above and will depend on the term and type of repayment option you select, evaluation of your creditworthiness, income, presence of a co-signer (if applicable) and a variety of other factors. Lowest rates reserved for the most creditworthy borrowers. Check out our eligibility criteria at https://www.sofi.com/eligibility-criteria/. For the SoFi variable-rate product, the variable interest rate for a given month is derived by adding a margin to the 30- day average SOFR index, published two business days preceding such calendar month, rounded up to the nearest one hundredth of one percent (0.01% or 0.0001). APRs for variable-rate loans may increase after origination if the SOFR index increases. The SoFi 0.25% autopay interest rate reduction requires you to agree to make monthly principal and interest payments by an automatic monthly deduction from a savings or checking account. This benefit will discontinue and be lost for periods in which you do not pay by automatic deduction from a savings or checking account. The benefit lowers your interest rate but does not change the amount of your monthly payment. This benefit is suspended during periods of deferment and forbearance. Autopay is not required to receive a loan from SoFi PARENT LOANS: This repayment example is based on typical loan terms for a borrower who selects the Immediate Repayment option with a 10-year repayment term, a $10,000 loan that is disbursed in a single disbursement, a 0.25% autopay discount, and a fixed rate between 9.27% – 14.83% APR (with autopay). The Immediate Repayment option assumes full payment begins 1 month after full disbursement. It works out to 120 monthly payments ranging from $128.14 – $160.30 for a total amount of payments ranging from $15,376,99 – $19,235.46. This repayment example assumes that the borrower is signed up for autopay and that all payments are made on time, with no pre-payments. Terms and conditions apply. Offer good for new and repeat borrowers that apply for and are approved for a SoFi Private Student Loan. To receive the offer, you must: (1) complete a loan application with SoFi between 11/11/24 12:01AM PT to 01/30/25 11:59PM PT; and (2) meet SoFi’s underwriting criteria. Once conditions are met and the loan has been disbursed, the interest rate shown in the Final Disclosure Statement will include an additional 0.25% rate discount. Offer cannot be combined with any other rate discounts, with the exception of the 0.25% AutoPay rate discount. SoFi reserves the right to change or terminate the Rate Discount Program to unenrolled participants at any time with or without notice. Actual rates may vary based on repayment type, loan amount, creditworthiness, and other terms and conditions. Lowest rates reserved for the most creditworthy borrowers. Actual rates may vary based on repayment type, loan amount, creditworthiness, and other terms and conditions. Lowest rates reserved for the most creditworthy borrowers. The SoFi 0.25% autopay interest rate reduction requires payments by an automatic monthly deduction from a savings or checking account. This benefit is suspended during periods of non-payment through ACH, deferment and forbearance. Autopay is not required to receive a loan from SoFi. Please borrow responsibly. SoFi Private Student loans are not a substitute for federal loans, grants, and work-study programs. We encourage you to evaluate all your federal student aid options before you consider any private loans, including ours. Read our FAQs. Terms and Conditions Apply. SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. SoFi Private Student loans are subject to program terms and restrictions, such as completion of a loan application and self-certification form, verification of application information, the student's at least half-time enrollment in a degree program at a SoFi-participating school, and, if applicable, a co-signer. In addition, borrowers must be U.S. citizens or other eligible status, be residing in the U.S., Puerto Rico, U.S. Virgin Islands, or American Samoa, and must meet SoFi’s underwriting requirements, including verification of sufficient income to support your ability to repay. Minimum loan amount is $1,000. See SoFi.com/eligibility for more information. Lowest rates reserved for the most creditworthy borrowers. SoFi reserves the right to modify eligibility criteria at any time. This information is current as of 4/22/2025 and is subject to change. SoFi Private Student loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891. (www.nmlsconsumeraccess.org).
INvestED Student Loan
670
4.37-8.08%
6.11-9.91%
- Key facts
Best for Indiana residents, particularly parents with good credit and a strong credit history.
Pros- Forbearance of 24 months is longer than many lenders offer.
- Interest rate reduction for autopay.
Cons- You can’t see if you’ll qualify and what rate you’ll get without a hard credit check.
- You must be an Indiana resident or attend a school in the state to qualify.
Qualifications- Typical credit score of approved borrowers or co-signers: 710.
- Minimum income: $39,996.
- Loan amounts: $1,001 up to annual cost of attendance.
Available Term Lengths5, 10 or 15 years
ELFI Private Student Loan
680
3.69-14.22%
5.00-13.97%
- Key factsBest for borrowers with a significant funding gap.Pros
- You can see if you’ll qualify and what rate you’ll get without a hard credit check.
- You are assigned a student loan advisor.
Cons- No co-signer release available.
Qualifications- Typical credit score of approved borrowers or co-signers: Not available.
- Minimum income: $35,000.
- Loan amounts: $1,000 up to your total cost of attendance.
Available Term Lengths5, 7, 10 or 15 years.
Citizens Private Student Loan
Does not disclose
3.49-14.99%
4.99-15.47%
- Key factsBest for existing Citizens Bank customers.Pros
- Six-month grace period extension is available.
- Loyalty discount for existing Citizens Bank customers.
- Multiyear loan approval is available.
Cons- You must be pursuing a bachelor’s degree or higher.
- You can’t see if you’ll qualify and what rate you’ll get without a hard credit check.
Qualifications- Typical credit score of approved borrowers: Does not disclose.
- Minimum income: Did not disclose.
- Loan amounts: $1,000 to $100,000.
Available Term Lengths5, 10 or 15 years
Earnest Parent Loan
650
4.45-14.90%
4.99-15.30%
- Key factsAn option for parent loan borrowers who want flexible repayment.Pros
- Option to skip one payment every 12 months.
- No late fees.
- Nine-month grace period is longer than most lenders offer.
Cons- Loans aren't available in Nevada.
Qualifications- Typical credit score of approved borrowers: 758.
- Minimum income: $35,000.
- Loan amounts: $1,000 up to your total cost of attendance.
Available Term Lengths5, 7, 10, 12 or 15 yearsDisclaimerEarnest Private Student Loans are made by One American Bank, Member FDIC, or FinWise Bank, Member FDIC. One American Bank, 515 S. Minnesota Ave, Sioux Falls, SD 57104. Finwise Bank, 756 East Winchester, Suite 100, Murray, UT 84107. Earnest loans are serviced by Earnest Operations LLC, 300 Frank H. Ogawa Plaza, Suite 340, Oakland 94612. NMLS #1204917, with support from Higher Education Loan Authority of the State of Missouri (MOHELA) (NMLS# 1442770) One American Bank, FinWise Bank, and Earnest LLC and its subsidiaries, including Earnest Operations LLC, are not sponsored by agencies of the United States of America. © 2025 Earnest LLC. All rights reserved.
Nelnet Bank Private Student Loan
Mid to High 600s
3.47-9.21%
5.81-9.21%
- Key factsBest for borrowers who value flexibility in repayment.Pros
- Provides rate offer with soft credit check.
Cons- Does not disclose full underwriting requirements.
- Does not allow bi-weekly payments via autopay.
Qualifications- Typical credit score of approved borrowers: Did not disclose.
- Loan amounts: $1,000 with an aggregate loan limit of $125,000 (Undergrad).
Available Term LengthsDisclaimerFixed interest rates range from 3.47% APR (with auto debit discount) to 9.21% APR (without auto debit discount). Your interest rate will depend on your (and if applicable, your cosigner’s) credit qualifications. The fixed interest rate will remain the same for the life of the loan. Variable interest rates range from 5.81% APR (with auto debit discount) to 9.21% APR (without auto debit discount). Your interest rate will depend on your (and if applicable, your cosigner’s) credit qualifications. Variable rates for Nelnet Bank Student Loans are calculated using either (a) the One-Month SOFR; (b) the 30-day Average SOFR; or (c) the forward-looking term rate based on SOFR as published by the Federal Reserve Bank of New York and/or The Wall Street Journal “Money Rates” table on the twenty-fifth day (or the next business day) of the immediately preceding calendar month. The variable rate may reprice and change on the first day of each month if the SOFR index changes. This may result in higher monthly payments. The current One-Month SOFR index is 4.35% as of May 1, 2025. Lowest rates listed above include an interest rate reduction for eligible applications, enrollment in auto debit, and are available only to the most creditworthy applicants. Advertised variable rates reflect the starting range of rates and may increase over the life of the loan. The lowest rate for each loan type requires automatically withdrawn (i.e., auto debit) payments. The lowest rate is available only to the most creditworthy applicants. Not all borrowers will receive the lowest rate. The interest rate and Annual Percentage Rate (APR) may be higher depending upon (1) the credit history of the borrower and, if applicable, the cosigner, (2) the repayment option and loan term selected, and (3) the loan type selected. If approved, applicants will be notified of the rate qualified for within the stated range. Interest rate reduction of .25% for automatically withdrawn payments from any designated bank account (“auto debit discount”). Auto debit discount applies when full payments (including both principal and interest) are automatically drafted from a bank account. The auto debit discount will continue to apply during periods of approved forbearance or deferment if the auto debit discount was in effect at the time of receiving the forbearance or deferment. Auto debit discount will remain on the account unless (1) the automatic deduction of payments is cancelled or (2) there are three consecutive automatic deductions returned for insufficient funds at any time during the term of the loan. Your actual savings, if any, may vary based on interest rates, balances, remaining repayment terms and other factors. Refinancing to a longer term may lower your monthly payments, but may also increase the total interest paid over the life of the loan. Refinancing to a shorter term may increase your monthly payments, but may lower the total interest paid over the life of the loan. Checking your rate results in a soft credit pull, which will not affect your credit score. If you continue with your application, Nelnet Bank will request your permission to obtain your full credit report from one or more consumer reporting agencies. This is a hard credit pull and may affect your credit score. Nelnet Bank offers various payment assistance programs to assist you if you are currently struggling to make payments. Contact us at [email protected] or 800.446.4190 to get more information. This referral partner is not the creditor of Nelnet Bank loans and may receive compensation from Nelnet Bank for the referral of Nelnet Bank loan customers. A request for the cosigner to be released can be made by either the borrower or cosigner when each of the following conditions has been met: • The account must have been in full principal and interest repayment for at least 24 months. • Twenty-four consecutive, on-time principal and interest payments, or lump sum equivalent, must have been made. Note: A lump sum payment does not replace the requirement to have been in full principal and interest repayment for at least 24 months. Interest-only or fixed-pay payments while enrolled in school do not qualify toward the 24 consecutive on-time payments. • The loan must be current at the time of request. • The loan must not have been in deferment, hardship forbearance, or other alternative payment assistance plan within the past 24 months. • The loan must not have been permanently modified from its original terms in the credit agreement. • The primary borrower must be a U.S. citizen or have permanent residency in the United States. • The primary borrower must meet the age of majority requirement in their permanent state of residency. • Requirements are subject to change. • If all of these conditions have been met, an application for cosigner release may be submitted. The primary borrower is required to demonstrate they have the ability to assume sole responsibility for the loan(s) by providing proof of income, meeting debt-to-income requirements, and having a satisfactory credit history. (A credit report will be obtained during the review process).
- Key factsBest for students who expect stable income after graduation.Pros
- No late fees.
Cons- You can’t see if you’ll qualify and what rate you’ll get without a hard credit check.
- Only one repayment plan offers co-signer release.
Qualifications- Typical credit score of approved borrowers: Did not disclose.
- Minimum income: $26,200
- Loan amounts: Minimum: $2,000 for a private college, $1,500 for a public college; maximum: total cost of attendance minus other financial aid.
Available Term Lengths10 or 15 years
Ascent Parent Loan
660
5.40-15.91%
5.80-15.51%
- Key factsBest for parents who want to support a student who is not enrolled in school at least half-time.Pros
- Offers loans to parents with students who are enrolled less than half-time.
- Allows bi-weekly payments via autopay.
Cons- No co-signer option.
- The parent or borrower’s estate still has to cover loan payments if the parent borrower dies.
QualificationsDisclaimerAscent’s undergraduate and graduate student loans are funded by Bank of Lake Mills or DR Bank, each Member FDIC. Loan products may not be available in certain jurisdictions. Certain restrictions, limitations, terms and conditions may apply. For Ascent's Terms and Conditions please visit: AscentFunding.com/Ts&Cs. Annual Percentage Rates (APRs) displayed above are effective as of 5/1/2025 and reflect an Automatic Payment Discount of 0.25% for credit-based college student loans and 1.00% discount on outcomes-based loans when you enroll in automatic payments. The Full P&I (Immediate) Repayment option is only available for college loans (except for outcomes-based loans) originated on or after June 3, 2024. For more information, see repayment examples ( visit https://www.ascentfunding.com/annual-percentage-rate-apr-sample/) or review the Ascent Student Loans Terms and Conditions. The final amount approved depends on the borrower’s credit history, verifiable cost of attendance as certified by an eligible school, and is subject to credit approval and verification of application information. Lowest interest rates require full principal and interest (Immediate) payments, the shortest loan term, a cosigner, and are only available for our most creditworthy applicants and cosigners with the highest average credit scores. Actual APR offered may be higher or lower than the examples above, based on the amount of time you spend in school and any grace period you have before repayment begins. 1% Cash Back Graduation Reward subject to terms and conditions. For details on Ascent borrower benefits, visit AscentFunding.com/BorrowerBenefits. The AscentUP platform is only available to eligible Ascent borrowers and subject to terms and conditions.
Advantage Education Loan Parent Loan
Does not disclose
5.29-8.04%
N/A
- Key factsBest for parents who don’t want to co-sign with their child.Pros
- Forbearance of 24 months is twice as long as most lenders.
- Loans are available for students enrolled less than half time.
Cons- Fewer repayment terms than other lenders offer.
- Estate is still responsible for the loan if the parent borrower dies.
- You can't see what rate you’ll get without a hard credit check.
Qualifications- Typical credit score of approved borrowers: Does not disclose.
- Minimum income: Does not disclose.
- Loan amounts: Minimum $1,000. Maximum depends on creditworthiness and debt-to-income ratio.
Available Term Lengths10 years
Our pick for
Parent college loans for Texans
- Key factsBrazos is best for parent loan borrowers who live in Texas and want to finance undergraduate or graduate education for their children.Pros
- Borrowers can finance undergraduate and graduate degree programs.
- Students do not have to attend college in Texas to qualify.
Cons- Available only to parent borrowers in Texas.
Qualifications- Typical credit score of approved borrowers: N/A
- Minimum income: $60,000 for co-signer or primary borrower, or $30,000 for primary borrower if applying with a co-signer.
- Loan amounts: $10,000 up to $400,000.
Available Term Lengths 5, 7, 10, 15, or 20 yearsDisclaimerRates as of 03/01/2025. Lowest variable rate assumes a current Thirty-day Average Secured Overnight Financing Rate (SOFR) of % plus a 2.03% margin minus the 0.25% Auto-Pay Discount. If approved for a Brazos loan, the fixed or variable interest rate offered will depend on your creditworthiness, the term of the loan and other factors, and will be within the ranges of rates listed above. For the Brazos variable rate loan, the Thirty-day Average SOFR index will adjust monthly and the loan payment will be re-amortized and may change monthly. APRs for variable rate loans may increase after origination if the SOFR index increases. Auto-Pay Discount. The interest rate in effect will be reduced by 0.25% if either the borrower or the cosigner authorizes automated (ACH) payments from any bank account. This ACH interest rate reduction, referred to as the Auto-Pay Discount, applies only when full principal and interest payments are automatically drafted from a bank account. This interest rate reduction will not continue to apply during periods of approved forbearance or deferment. The Auto-Pay Discount will terminate if the automatic bank account payments discontinue or there are any three instances of insufficient funds at any time during the term of the loan. A borrower may requalify upon reauthorization of automatic payments from a valid bank account.This means that your payment may increase, or decrease, after disbursement. The variable rate is capped and will never exceed 9.90%. The rate is expressed as an APR. Since there are no fees associated with this loan, the APR is the same as the actual interest rate for the loan. While the APR, once you proceed, may differ slightly depending upon the calculation methods and certain assumptions, the base rate and margin that you are charged will remain as stated. Auto-Pay Discount includes a .25% interest rate reduction when either the borrower or cosigner authorizes ACH payments of full principal and interest from any bank account. Certain other terms and conditions apply.
What is a federal direct PLUS loan for parents?
Federal direct PLUS loans are government loans that parents can take out to help pay for a child's college education. They have higher interest rates and fees and qualify for fewer repayment plans than federal direct loans for students.
How do parent PLUS loans work?
To be eligible for a parent PLUS loan, you’ll need to be a biological or adoptive parent of a dependent undergraduate student who is enrolled at least half-time in school. There are exceptions for stepparents, but grandparents do not qualify — even if they’ve raised the student — unless they have legally adopted the dependent student.
Are parent PLUS loans federal or private?
Parent PLUS loans are provided by the U.S. Department of Education, which makes them federal student loans. In contrast, private loans are given by entities such as banks and credit unions.
Can I get a parent PLUS loan with bad credit?
You will undergo a credit check when applying to parent PLUS loans. However, if you have adverse credit history there are options. You can find an endorser with good credit, which is a person who agrees to repay the loan if you do not. The child you are seeking funding for cannot be your endorser.
A second option is to provide documentation outlining extenuating circumstances for why you have adverse credit history. For either option, you’ll need to complete required credit counseling.
What is the interest rate for parent PLUS loans?
The interest rate for federal direct PLUS loans is 9.08% for the 2024-25 academic year. There is also an origination fee of 4.228% of the loan amount, which is deducted from each loan disbursement.
What is a private student loan?
Private student loans are provided by nonfederal lenders. This includes banks, credit unions, state agencies, among others. Terms and conditions for private student loans are set by each lender, whereas federal student loan terms are determined by law. Private student loans are often more expensive than federal loans.
» COMPARE: Best private student loans for college
What is better: A parent PLUS loan or private loan?
To help you assess if a parent PLUS loan or private loan is right for you, consider your current financial situation and employment outlook.
If your finances are secure and you expect your income to remain steady, you may qualify for a low rate on a private student loan. These loans also have no origination fees.
If your finances are solid, but you foresee future gaps in your income, a loan with relevant safety nets may be best. Parent PLUS loans offer an income-contingent repayment option and extend death and disability discharges to parent borrowers. Only some private loans offer income-based repayment or the death and disability discharge.
If you're building your finances and don't meet private loan requirements, a PLUS loan — which has looser credit requirements — is likely best for you.
Before taking parent student loans, make sure that:
Your child has maxed out federal student loan options.
You’re saving enough for retirement.
You’re managing high-interest debt like credit cards.
Assuming your child has exhausted federal student loan options and your finances are sound, consider a parent PLUS loan if:
You work for the government or a 501(c)(3) nonprofit and want to pursue Public Service Loan Forgiveness.
You may not have steady income for the duration of the loan term.
Your credit isn't strong enough to qualify for a lower rate with a private parent loan.
» MORE: Estimate monthly payments using a parent PLUS loan calculator
How to apply for parent PLUS loan
Plan to spend at least 20 minutes completing the parent PLUS loan application. It must be completed in a single session. However, you may need more time to gather up required documents and to complete the FAFSA first.
Fill out the Free Application for Federal Student Aid. To apply for a PLUS loan, fill out the FAFSA with your child. NerdWallet's FAFSA guide can help.
Check your credit. If you have a security freeze on your credit file, remove it from each credit bureau. Review your credit report for any errors, and do what you can to build your credit before you apply.
Complete the direct PLUS loan application for parents. You’ll need your verified FSA ID, your requested loan amount, school name, student information, personal information and employer’s information.
How to apply for private student loans
You can apply for a private parent student loan directly with the lender.
Shop around. Before signing up for a private parent loan, shop around to find the lowest student loan interest rate you qualify for. Also look for information on origination, prepayment or late fees, and how easily you can reach the lender if you have an issue.
Consider pre-qualifying. Some lenders have a pre-qualification process that allows you to see a personalized rate before the lender does a hard credit pull. This can give you an idea of which loans you may be eligible to receive before making any commitments.
Choose a fixed rate. Fixed interest rates do not change over time and are a better option over variable rates that may fluctuate throughout the lifespan of the loan.
Are parents responsible for student loans?
Parents are responsible for loan repayments. Make sure you and your child work out clear plans for repayment before taking a parent student loan since you are legally responsible for the debt.
What are repayment options for parent PLUS loans?
Parent PLUS borrowers have several repayment options. The first is the standard repayment plan, which is the one you’ll automatically get unless you specify otherwise. With the standard repayment plan, your payments are fixed for a term of up to 10 years.
The other key repayment option is the Income-Contingent Repayment (ICR) plan. Under this plan, payments are capped at 20% of your discretionary income. The repayment term is extended to up to 25 years, at which point any remaining debt is forgiven.
Are parent PLUS loans eligible for student loan forgiveness?
You may be eligible for student loan forgiveness under certain situations. For example, you could seek Public Service Loan Forgiveness, but you would need to first consolidate your loan into a direct consolidation loan and then enroll in an Income Contingent Repayment Plan (ICR).
Can a parent PLUS loan be transferred to the student?
A parent PLUS loan cannot be transferred from a parent to student. The only way to transfer parent loans is to have your child refinance the loan with a private lender in their name.
Last updated on May 2, 2025
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