How to Get Parent PLUS Loan Forgiveness
While parent PLUS loan forgiveness isn’t as widely available as forgiveness for student borrowers, a few options do exist.
Some options include the Income-Contingent Repayment plan (forgiveness after 25 years of payments) and Public Service Loan Forgiveness (forgiveness after 10 years), as well as other methods.
4 parent PLUS loan forgiveness options
Here are four methods you can try for working toward parent PLUS loan forgiveness, depending on your personal situation.
Income-Contingent Repayment (ICR)
One way to have your parent PLUS loans forgiven is by enrolling in an Income-Contingent Repayment plan (ICR). Just like other income-driven repayment plans, this plan calculates your monthly payment based on a percentage of your disposable income and allows you to pay off the loan over a longer period of time.
Specifically, an ICR only requires you to pay 20% of your discretionary income, or the same amount that you would pay on a fixed 12-year repayment plan, whichever is less.
At the same time, the ICR plan extends your repayment term to 25 years. Any remaining loan balances will be forgiven after that time.
As of now, you won’t be taxed on the amount of student debt forgiven, although this could change in 2026, when the current regulations expire.
How to get loan forgiveness via the ICR plan
- In order to be enrolled in an ICR plan, you first need to swap your parent PLUS loans for a Direct Consolidation loan. You can apply to consolidate your loans over at StudentAid.gov.
- You can then ask your loan servicer to enroll you in the ICR plan.
- Make your monthly payments for the next 25 years, and the remaining balance will be wiped away.
Public Service Loan Forgiveness (PSLF)
Under the Public Service Loan Forgiveness (PSLF) program, parents who work for certain government entities or nonprofit organizations may be able to have their loans forgiven after 10 years of payments.
In order to be eligible for the PSLF program, your parent PLUS loans must also be consolidated into a Direct Consolidation loan and enrolled in the Income-Contingent Repayment plan, just as with the ICR option above.
Unfortunately, under the current program guidelines, only payments made on the Direct Consolidation loan will count toward forgiveness. Any payments made before consolidation will not qualify.
If you’re going to go this route, be sure to hang on to any paperwork relevant to the PSLF program. You will likely be asked to resubmit paperwork annually and whenever you’re starting work with a new employer, as well as after you have made 10 years of payments.
How to get loan forgiveness via PSLF
- Confirm that you work for an eligible employer.
- Apply for a Direct Consolidation loan and enroll in the ICR plan.
- Make your monthly loan payments.
- Use the PSLF Help Tool to submit your PSLF form annually, when starting with a new employer, and after making 120 payments toward your loan balance.
Career-based loan repayment assistance programs
While PSLF is designed for those who work for government entities or nonprofits, other service-based professionals may be eligible for student loan forgiveness through state-run repayment assistance programs.
You’ll have to do some research into the specific programs offered by your state — contact your state education authority as a first step. Here’s a list of careers that commonly qualify:
In addition, even if you’re not working in a service-based industry, some companies pay off student loans for their employees as part of their benefits package. It may be worth talking to an human resources representative at your company to see if a similar benefit is available to you.
How to get loan forgiveness via your chosen career path
- Research loan forgiveness programs in your state.
- Talk to HR to see if your company has any loan forgiveness initiatives available.
- Decide on the program that works best for you and follow its requirements
Refinance parent PLUS loans in your child’s name
As a parent borrower, the options for student loan forgiveness are somewhat limited. They either take a long time to complete or they have strict eligibility requirements. However, there is another way to get financial relief.
It’s possible to transfer a parent PLUS loan to a student by refinancing the loan in the student’s name.
It’s extremely important to note, however, that doing so will mean refinancing your loans with a private lender which will cause both you and your student to lose federal repayment protections.
Typically, this method is only recommended if you’re struggling to make payments, but your student is doing well financially. The student will have to meet the lender’s eligibility requirements and have to prove their ability to repay the loan in order to qualify for the refinance.
Beware of refinancing federal student loans
If you choose to refinance federal student loans with a private lender, you will lose access to federal repayment protections. In addition, this move can not be undone. Be sure to do your research before moving forward.
How to get financial relief via refinancing
- Make sure you understand what benefits you could stand to lose by refinancing federal loans.
- Research private student loan lenders to find the best fit for you and your student.
- Ask your student to apply to refinance with your chosen lender.
- Remember to include your parent PLUS loan information on the refinancing application.
- Keep making payments on your loan until it has been paid off in full.