Parent PLUS loans are federal loans that parents can take out to help pay for their child's college education. These loans are not eligible for forgiveness under most circumstances, but there are a few exceptions.
This guide will explain the eligibility requirements for Parent PLUS loan forgiveness, as well as the different types of forgiveness programs available. We will also provide information on how to apply for forgiveness and what to expect during the process.
In the next section, we will discuss the eligibility requirements for Parent PLUS loan forgiveness in more detail.
Are Parent PLUS Loans Eligible for Forgiveness?
Generally, Parent PLUS loans are not eligible for forgiveness. However, there are a few exceptions to this rule.
- Public service.
- Teacher forgiveness.
- Disability discharge.
- Death discharge.
- Closed school discharge.
- Bankruptcy discharge.
- False certification discharge.
- Unpaid refund discharge.
If you believe you may qualify for Parent PLUS loan forgiveness, you should contact your loan servicer to learn more.
Public service.
One way to get Parent PLUS loans forgiven is through the Public Service Loan Forgiveness (PSLF) program.
- Work for a qualifying employer.
To be eligible for PSLF, you must work full-time for a qualifying public service employer. This includes government agencies, non-profit organizations, and certain other types of employers.
- Make 120 qualifying payments.
You must make 120 qualifying payments on your Parent PLUS loans while working for a qualifying employer. Payments made during periods of deferment or forbearance do not count towards the 120 payments required for forgiveness.
- Apply for forgiveness.
Once you have made 120 qualifying payments, you can apply for forgiveness of your remaining Parent PLUS loan balance. You can apply for PSLF online or by submitting a paper application to your loan servicer.
- Receive forgiveness.
If your application for PSLF is approved, your remaining Parent PLUS loan balance will be forgiven. This means that you will no longer owe any money on your Parent PLUS loans.
PSLF is a great way to get Parent PLUS loans forgiven if you work in public service. However, it is important to note that PSLF is not available to everyone. You must meet all of the eligibility requirements in order to qualify for forgiveness.
Teacher forgiveness.
Another way to get Parent PLUS loans forgiven is through the Teacher Loan Forgiveness Program.
- Teach for five complete and consecutive academic years.
To be eligible for teacher forgiveness, you must teach full-time for five complete and consecutive academic years in a low-income public or private elementary or secondary school. You must also be certified by the state in which you teach.
- Make 120 qualifying payments.
You must make 120 qualifying payments on your Parent PLUS loans while teaching. Payments made during periods of deferment or forbearance do not count towards the 120 payments required for forgiveness.
- Apply for forgiveness.
Once you have made 120 qualifying payments and taught for five complete and consecutive academic years, you can apply for forgiveness of your remaining Parent PLUS loan balance. You can apply for teacher forgiveness online or by submitting a paper application to your loan servicer.
- Receive forgiveness.
If your application for teacher forgiveness is approved, your remaining Parent PLUS loan balance will be forgiven. This means that you will no longer owe any money on your Parent PLUS loans.
Teacher forgiveness is a great way to get Parent PLUS loans forgiven if you work as a teacher in a low-income school. However, it is important to note that teacher forgiveness is not available to everyone. You must meet all of the eligibility requirements in order to qualify for forgiveness.
Disability discharge.
If you are totally and permanently disabled, you may be eligible for a disability discharge of your Parent PLUS loans. To be eligible, you must meet the following requirements:
- You must be unable to work due to a physical or mental impairment that is expected to last for at least six months or result in death.
- You must have a doctor's certification of your disability.
- You must have applied for Social Security disability benefits or Supplemental Security Income (SSI).
If you meet all of the eligibility requirements, you can apply for a disability discharge of your Parent PLUS loans. You can apply online or by submitting a paper application to your loan servicer.
If your application for a disability discharge is approved, your remaining Parent PLUS loan balance will be discharged. This means that you will no longer owe any money on your Parent PLUS loans.
It is important to note that a disability discharge is not the same as a loan forgiveness. A loan forgiveness discharges your loans after a certain number of years of repayment or after you meet certain other requirements. A disability discharge discharges your loans because you are unable to repay them due to a disability.
Death discharge.
If the borrower of a Parent PLUS loan dies, the loan may be discharged. To be eligible for a death discharge, the following requirements must be met:
- The borrower must have died.
- The borrower's estate must not have enough assets to pay off the loan.
- The borrower must not have a cosigner on the loan.
If all of the eligibility requirements are met, the Parent PLUS loan can be discharged. The loan servicer will typically discharge the loan automatically upon receiving a death certificate for the borrower. However, if the loan servicer does not discharge the loan automatically, the borrower's estate or next of kin can contact the loan servicer to request a discharge.
A death discharge is a complete discharge of the Parent PLUS loan. This means that the loan will be forgiven and the borrower's estate will not be responsible for repaying the loan.
It is important to note that a death discharge is not the same as a loan forgiveness. A loan forgiveness discharges a loan after a certain number of years of repayment or after the borrower meets certain other requirements. A death discharge discharges a loan because the borrower has died.
Closed school discharge.
If the school that the borrower of a Parent PLUS loan attended closes, the loan may be eligible for a closed school discharge. To be eligible for a closed school discharge, the following requirements must be met:
- The school must have closed while the borrower was enrolled or within 120 days after the borrower withdrew from the school.
- The borrower must not have been able to complete their program of study at the school.
- The borrower must not have been able to transfer to another school or program of study.
If all of the eligibility requirements are met, the Parent PLUS loan can be discharged. The borrower can apply for a closed school discharge by submitting an application to their loan servicer. The application must include documentation of the school's closure, such as a news article or a letter from the school's registrar.
A closed school discharge is a complete discharge of the Parent PLUS loan. This means that the loan will be forgiven and the borrower will not be responsible for repaying the loan.
It is important to note that a closed school discharge is not the same as a loan forgiveness. A loan forgiveness discharges a loan after a certain number of years of repayment or after the borrower meets certain other requirements. A closed school discharge discharges a loan because the school that the borrower attended has closed.
Bankruptcy discharge.
In some cases, Parent PLUS loans may be discharged in bankruptcy. However, it is important to note that Parent PLUS loans are not dischargeable in bankruptcy unless the borrower can prove that they are unable to repay the loans due to undue hardship.
To prove undue hardship, the borrower must show that they have:
- A low income and high expenses, making it difficult to repay the loans.
- A physical or mental disability that makes it difficult to work and earn a living.
- Other circumstances that make it impossible to repay the loans.
If the borrower can prove undue hardship, the court may discharge the Parent PLUS loans. However, it is important to note that bankruptcy discharge is a last resort and should only be considered after all other options for repayment have been exhausted.
If you are considering filing for bankruptcy, it is important to talk to an attorney to discuss your options. An attorney can help you determine if you are eligible for a bankruptcy discharge of your Parent PLUS loans.
False certification discharge.
In some cases, Parent PLUS loans may be discharged if the school falsely certified the borrower's eligibility for the loans.
- The school failed to notify the borrower of their rights and responsibilities under the loan program.
For example, the school may have failed to tell the borrower about the grace period or the different repayment options available.
- The school provided false or misleading information about the borrower's eligibility for the loans.
For example, the school may have told the borrower that they were eligible for a lower interest rate than they actually qualified for.
- The school failed to properly evaluate the borrower's creditworthiness.
For example, the school may have approved the borrower for a loan even though they had a poor credit history.
- The school engaged in other misconduct that resulted in the borrower being unable to repay the loans.
For example, the school may have closed without providing the borrower with notice.
If the borrower can prove that the school falsely certified their eligibility for the loans, they may be eligible for a false certification discharge. The borrower can apply for a false certification discharge by submitting an application to their loan servicer. The application must include documentation of the school's false certification, such as a letter from the school's registrar or a copy of the school's marketing materials.
Unpaid refund discharge.
In some cases, Parent PLUS loans may be discharged if the school owes the borrower a refund and the refund is not paid within 120 days.
- The school failed to refund the borrower's unused financial aid within 120 days of the date the school was notified that the borrower withdrew from the school.
The amount of the refund must be equal to or greater than the amount of the Parent PLUS loan.
- The school failed to refund the borrower's unused financial aid within 120 days of the date the school was notified that the borrower was overcharged for tuition and fees.
The amount of the refund must be equal to or greater than the amount of the Parent PLUS loan.
- The school failed to refund the borrower's unused financial aid within 120 days of the date the school was notified that the borrower was awarded a scholarship or grant that was not included in the borrower's financial aid package.
The amount of the refund must be equal to or greater than the amount of the Parent PLUS loan.
- The school failed to refund the borrower's unused financial aid within 120 days of the date the school closed.
The amount of the refund must be equal to or greater than the amount of the Parent PLUS loan.
If the borrower is eligible for an unpaid refund discharge, the loan servicer will automatically discharge the Parent PLUS loan. The borrower does not need to apply for the discharge.
FAQ
If you're a parent with a Parent PLUS loan, you may have questions about whether or not your loan is eligible for forgiveness. Here are some frequently asked questions and answers to help you understand your options:
Question 1: Can Parent PLUS loans be forgiven?
Answer 1: In general, Parent PLUS loans are not eligible for forgiveness. However, there are a few exceptions to this rule, such as public service loan forgiveness, teacher loan forgiveness, and disability discharge.
Question 2: How can I get my Parent PLUS loan forgiven through public service?
Answer 2: To get your Parent PLUS loan forgiven through public service, you must work full-time for a qualifying public service employer for 10 years and make 120 qualifying payments on your loan. You can learn more about public service loan forgiveness at StudentAid.gov.
Question 3: How can I get my Parent PLUS loan forgiven through teaching?
Answer 3: To get your Parent PLUS loan forgiven through teaching, you must teach full-time for five complete and consecutive academic years in a low-income public or private elementary or secondary school. You must also make 120 qualifying payments on your loan. You can learn more about teacher loan forgiveness at StudentAid.gov.
Question 4: Can Parent PLUS loans be discharged in bankruptcy?
Answer 4: Parent PLUS loans can be discharged in bankruptcy, but only if the borrower can prove that they are unable to repay the loans due to undue hardship. Undue hardship is a legal standard that is difficult to meet. You should talk to an attorney to discuss your options if you are considering filing for bankruptcy.
Question 5: What is a false certification discharge?
Answer 5: A false certification discharge is a discharge of a Parent PLUS loan that occurs when the school falsely certified the borrower's eligibility for the loan. For example, if the school failed to notify the borrower of their rights and responsibilities under the loan program or if the school provided false or misleading information about the borrower's eligibility for the loan, the borrower may be eligible for a false certification discharge.
Question 6: What is an unpaid refund discharge?
Answer 6: An unpaid refund discharge is a discharge of a Parent PLUS loan that occurs when the school owes the borrower a refund and the refund is not paid within 120 days. The amount of the refund must be equal to or greater than the amount of the Parent PLUS loan.
If you have additional questions about Parent PLUS loan forgiveness or discharge, you should contact your loan servicer or the U.S. Department of Education.
Now that you know more about Parent PLUS loan forgiveness and discharge, you can start taking steps to manage your loans and reach your financial goals.