Parent Plus Loan FAQ

Paying for College
1

<p>So I talked a little about the plus loans with my parents. They understand that they have to take out these loans in order to pay off the rest of my housing and tuition bill (I have worked during parts of the school year and the entire summer in order to save money for books and miscellaneous school costs). I have read up on the basics of the loans including the types of deferment, the repayment plan, and how it is wise to try to pay off the interest during the school year(s) in order to avoid capitalized interest during the 6 months of deferment and the repayment afterwards. However, I don't know how interest is repaid. Is there a set schedule of interest repayment during the school year by the service provider or do we pay when we have the money to pay? Are there any parents out there with advice to give to my parents about paying off loans sparingly through the years to avoid a whopping sum at the end? My parents are borrowing about 5,421 which is a lot better than the original sum because I worked very hard to get outside scholarships, saved money from my job, and I chose the cheapest housing my school offers. </p>

<p>It's just frustrating to have my parents pay even though I worked diligently throughout high school and was top 7% of my class, but a high EFC just breaks everything. </p>

2

<p>I don’t think Parent PLUS borrower has any deferment, unless the borrower also is a student. See <a href=“http://www.direct.ed.gov/parentrepay.html”>http://www.direct.ed.gov/parentrepay.html&lt;/a&gt;

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3

<p>There is no grace period for PLUS loans, so it would be best if your parents could make the payments immediately. They don’t HAVE to, and interest will accrue, but in the long run they will be better off if they start paying immediately. They can set up the payments immediately with the loan servicer. How much can they pay per month? If they can pay $250/mo, they could pay most of it in 2 years.</p>

<p>You can be mad about having to pay for your college all you want, but everyone who wants something has to pay for it - house, car, children, food. If you want a free education, you have to choose one of the schools that offer that, like a military academy or Berea, or Ozarks. </p>

4

<p>The Plus loan CAN be deferred by the parent while the student is still in school. That is what the next paragraph says in the link provided by 4kidsdad. It just needs to be requested. BUT, it’s not a good idea to let that interest build up! </p>