Asking for a business colleague whose child is a freshman in high school. She will be a senior 3 years from now in 2018-2019. He had a state tax lien in 2013 (all paid and satisfied). I read that if you have a tax lien in the past 5 years, you can’t get a Parent Plus loan.
I forget – when your kid is applying to college, when do you apply for financial aid? I guess the question is: if he applies in January of 2019 (her senior year of high school) then isn’t he outside the 5 year tax lien window?
Hi Mom2ck! I got this from a Parent Plus loan Q&A site:
“If the borrower has had certain derogatory events in their credit history during the last five years or currently has a delinquency of 90 or more days on any debt, the borrower will not qualify for a Parent PLUS loan. The derogatory events include bankruptcy discharge, default determination, foreclosure, repossession, tax lien and wage garnishment.”
Thanks BelknapPoint. I’m thinking then if he applies for aid in 2019 and the tax lien was filed and paid in 2013, he should be able to qualify for a Parent Plus loan (or at least not have the tax lien hurt him).
With the change in the FAFSA I think the 19/20 school year FAFSA will be available to file starting in October of 2018. Does he think he will qualify for federal FA? Then it might be a disadvantage not to file the FAFSA until Jan of 2019.
But applying for plus loan is a separate event from filing FAFSA. He wouldn’t apply for a plus loan until spring or summer before freshman year of college, so 2019.
If he gets denied D can take out additional $4 federal student loan. How much of a plus loan were they planning on taking out?
Plus loan should be last resort, after student loans. Parent should try to save extra money in the three years in case they don’t qualify for Plus loan the first year because of tax lien.
Student should try to get very good grades and test scores to maximize merit aid and get a summer job.