July 30, 2010

Can I transfer a Parent PLUS Loan?

Posted in Parent PLUS Loans, Private Loans, Student Loan News tagged , , at 2:10 PM by plusloans

Many parents, who take out the Parent PLUS Loan, believe they could always transfer the loan to the child, once he or she has graduated and secured a reasonable income. Unfortunately, that is not the case. The PLUS Loan is the responsibility solely of the parent, and is taken out in the parent’s name. He or she is the borrower, not the student.

One option, if finances become an issue for the parent, is to simply have the student reimburse the parent for the cost of the monthly payment, but continue to make the payments in the parent’s name.

If, as a parent, you would prefer a loan that allows you to eventually transfer the repayment obligation, consider a private student loan. These loans are in the student’s name, and depending on the lender, generally have a cosigner release option. After a certain number of consecutive on time payments, the parent (as a co-signer) can apply to be released from the loan, making it entirely the student’s obligation for repayment.


  1. Sally said,

    This happen to us and it is so wrong, The school also advise us to take out this loan and we even asked if we could have it transfer to our daughter and they said yes. The government needs to help or change the laws that it can be transfer to the student. We can’t afford it either.

  2. rosie said,

    Duped, Duped by all, including my SON!! the bottom line – do not get involved in parent plus loans, I took out $32,000 in loans for my son, with the honor system that he would assume the loan after graduation and a year in employment, he has paid, NADA, ZIP, ZILCH! the biggest sadness of these loans is that the “child”/ student, chooses to assume no responsibility for them, ethically and morally, the “child” should step up! there is no legal recourse for the parent what so ever! I had no issues with my relationship with my son, until it was his “turn” to take over the payments, POOF, he was gone, my entire family is in disbelief, I’ve been struggling for 10 years, and they seem endless!
    IF you are reading these comments to decide if you should, or shouldn’t sign for a loan… DON’T and IF you do,signed by a notorary contract from your child, SOMETHING, that if he/she defaults on their moral obligation, you, may, just MAY, be able to sue the little… BLEEP! and if you are reading this and have placed your parent in this situation… SHAME ON YOU!

  3. Lou Dueso said,

    My son’s college handled all the student loans and called us to let us know we had to make out the papers and sign the loan online. We believed we were signing as a cosigner and not the sole borrower. I feel as though we were tricked by the college. We are fortunate that our son has assumed the responsibility and pays the loans himself. however it has affected our borrowing for a retirement second
    home based on the amount of college loan debt in my husband’s name! I would NEVER recommend anyone to do the Parent plus loans!

  4. Rosa said,

    The same thing happen to me with my son I think there a ripoff they love to take the money but dont wont to help out to see what they could do about that parent PLUS loan. The president alway talk about he want to help out the students but what happen about the parent that have the same problem with school loans.

  5. Phil said,

    No one should ever take a Parent Plus Loan. My husband was assured that we could transfer this debt to our son. But of course this is not true. What is worse is our son makes more money then me and my husband who was placed on disability last year. The loans are in his name.

    Our son thinks that the $22,000 in Student Loans is all he should have to pay back. My husband has over $90,000 in debt and we cannot afford to make the payment.

    Unless your child can make the payments or you are paying out right for college for your child please avoid Parent Plus Loans at all costs.

  6. David said,

    At the time of my retirement(hopefully) I will have enough saved in my company 401k plan to pay this (my sons loan) It saddens me to realize I am not as important to my Son as I thought. He has never made an effort to help.

  7. Frank said,

    For future parents and students- do not use the Parent PLUS loan. It is a scam, designed by the government and endorsed by the government.

    Get a private loan instead. Even if the interest is higher to begin with, the flexibility and stability are worth it.

    I’ve just graduated from college, and my parents have 100s of thousands of dollars of debt in their name. The interest rate is exorbitantly high, guaranteed to be more than any private loan. Even worse, my father will simply not be able to retire peacefully because he cannot transfer this debt to his son- me.

    Do not by any means go with a Parent PLUS loan- do a private loan instead, no matter how much money you require.

  8. Robert said,

    Can I claim the interest on my Parent Plus loan? Any restrictions?

    • edvisors said,

      You need to check with a tax advisor – it varies by state and by individual.

  9. Eric Klamer said,

    The majority of my student loans are under my mother as a Parent Plus Loan. She will not ever pay a dime, and this was always understood. I make much more than her, and I make the loan payments to her account. It is great to know she gets my significant interest deductions every year.

  10. Jordan said,

    Hi, I am trying to understand the Parent Plus loan. Do my parent have to make the payments while I am in college or afterwards? I do not make enough money to take out a loan without a cosigner but my parents and I are at a loss as to which steps to take. The school proposed that they take the PLUS loan but I really dont want them to be stuck with the debt. Is the Plus loan something I should avoid?

  11. Ruth said,

    As a parent who this happen to i would just like to say that I was misled when I signed up for the loan for my son’s education, I was told after he had been out of school for 2 years that he could take over this loan, and now that is not the case, I only wish i had know at the first and would have taken out some other type of loan

    • Renee said,

      This happen to my mother and I as well, it was years ago and my mother is deaf and on social security. It has defaulted for years and now it is so much money I just feel like their is no hope. My school explained it exactly as they did to you.

    • Chaz said,

      This has also happened to us. They duped us

      • Al said,

        We were misled also. And we are having a hard time figuring out how to repay. In the meantime interest is accruing at $1200 per month.

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