April 15, 2010
Can a Parent PLUS loan be transferred?
One question we get a lot regarding Parent PLUS loans is whether or not the payments can be transferred to a child. The answer, sadly, is no. Parent PLUS loans are federal-based loans taken out by the parent in his or her name, and will remain so throughout the duration of the repayment.
However, as a parent, there are options if you are unable to pay, or expect you will be unable to pay back a PLUS loan.
If you have yet to take out a PLUS loan, you might be better off applying for a private student loan if you are concerned about being unable to make payments in the long run. With a private student loan, you can apply to be released from the loan after a set number of consecutive payments and have the remaining sum transferred to the student.
If you are parent who has already taken out a PLUS loan, you could establish a payment plan with the student, whereby the parent pays the loan back directly to the lender, and then the student reimburses the parent.
Do you have any other questions about the Parent PLUS loan? Post them in our Financial Aid forum!