Parent PLUS Loan Forgiveness Is Possible: Here’s How to Get It

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While taking out a Parent PLUS Loan can often be a great solution for parents of college-bound students, repayment can quickly become an overwhelming struggle for some borrowers. Luckily, there are a few sources of Parent PLUS loan forgiveness you can investigate to get rid of your debt once and for all.

While none of these forgiveness programs will erase your loan overnight, they could eventually lead to a partial, or even full, cancelation of your debt.

1. You could get Parent PLUS Loan forgiveness through Income-Contingent Repayment (ICR)

One way to get your Parent PLUS Loans forgiven is through the income-driven plan known as ICR. This plan caps your monthly payments at 20% of your discretionary income or the amount you would pay on a fixed 12-year plan, whichever is lower.

It also extends your repayment terms to 25 years, so you’ll be paying less each month. If you still have a balance at the end of 25 years, the remaining amount will be forgiven.

Your remaining balance will be discharged, but it will still be considered taxable income. So make sure to prepare for one last expense before you can say goodbye to your Parent PLUS Loans.

This kind of loan forgiveness takes a long time, but it could be a good option if you need relief from high monthly bills. The Office of Student Aid offers a handy Repayment Estimator tool to predict your monthly payments.

There’s just one problem with getting your Parent PLUS Loans on ICR, though — to make them eligible, you need to consolidate them first with a Direct Consolidation Loan.

Here are the steps to take in order to get your Parent PLUS Loans on ICR and eventually, qualify for loan forgiveness:

Step 1: Apply for a Direct Consolidation Loan through

Step 2: Talk to your loan servicer and choose ICR.

Step 3: Make payments on time for 25 years to get your loans forgiven. Pay any potential tax bills related to your loan forgiveness.

Two and a half decades is a long time to wait, but at least there’s a light at the end of the tunnel. By keeping up with payments, you can eventually get Parent PLUS loan forgiveness.

2. You might also qualify for Public Service Loan Forgiveness (PSLF)

A second option for Parent PLUS loan forgiveness — and one that doesn’t take as long as the ICR approach — is PSLF.

Under this program, parents who work full-time for certain government entities or nonprofits and make consistent payments for 10 years can get their loans forgiven.

Just like with ICR, though, you’ll have to change up your repayment plan in order to qualify.

If you stayed on the standard 10-year plan, you wouldn’t have any remaining balance left on your loans to forgive. And you’re not eligible for most income-driven plans with the exception of ICR, if you consolidate first.

So again, you’ll need to apply for a Direct Consolidation Loan and then get your loan on ICR. Assuming you have a large enough loan and work for a qualifying employer, this route could lead you to loan forgiveness.

That being said, the fate of PSLF has been up in the air lately, and it’s unclear whether the government will continue to fund the program for new applicants.

In the meantime, though, the program still exists. If you work in public service, hold onto relevant documentation that you might need when you apply. You could fill out and submit the PSLF Employment Certification form on a yearly basis, for instance, or more often if you change employers.

After 10 years, you could see forgiveness of your Parent PLUS Loan (now technically a Direct Consolidation Loan). And here’s more good news: Under PSLF, your forgiven loans are not considered taxable income.

3. Your career might qualify you for repayment assistance programs

While public servants could qualify for Parent PLUS loan forgiveness through PSLF, professionals in other sectors might be eligible for state-run repayment assistance programs. Some common careers that qualify include doctor, nurse, teacher, lawyer, pharmacist and dentist.

Some private companies also help their employees pay off their loans with a student loan matching benefit. Similar to a 401(k) match, these companies pay off their employees’ student loans up to a certain amount.

Depending on your career or employer, you could qualify for student loan assistance and get rid of your Parent PLUS Loans ahead of schedule.

4. You could refinance Parent PLUS Loans in your child’s name

As a parent borrower, your options for full Parent PLUS loan forgiveness are limited to forgiveness from ICR or through PSLF, both of which take a long time for you to get financial relief.

Instead of counting on loan forgiveness, you might also consider transferring your loans to your child. Even though you took out the loans in your name, you could trade them into your child’s name through student loan refinancing.

Your child must be the one who applies for student loan refinancing and gets approved. Most lenders look for a steady source of income and a strong credit score before approving a refinanced student loan.

If your child has that, they could qualify for a lower interest rate than the 7.08% (or higher) rate that Parent PLUS Loans have. Plus, they could choose new repayment terms of shorter or longer lengths.

This transfer of responsibility could be a good option if you’re struggling with repayment, but your child is now graduated and doing well financially. It’s important to know, though, that refinancing federal student loans turns them into private ones.

As a result, your child will lose access to federal protections, like income-driven repayment plans and forbearance, as well as forgiveness programs like PSLF. So if you want to retain federal protections, refinancing probably isn’t the best move.

But if you don’t need those options, refinancing could reduce your costs of borrowing with a lower student loan interest rate.

Explore different ways to manage your Parent PLUS Loans

While none of these options will make your Parent PLUS Loan disappear overnight, they could lead to significant financial relief down the line. If you’re looking for more immediate help, consider putting your loans on Income-Contingent Repayment or refinancing for new terms and a lower rate.

By exploring all the options available to you, you can make repaying your Parent PLUS Loans a lot more manageable.