Yes, federal Parent PLUS loans are discharged (forgiven) if the parent borrower dies or if the student for whom the loan was taken out dies, meaning the debt isn't passed to family, but a death certificate must be submitted to the loan servicer to process the discharge. This applies to federal loans, while private loans may have different rules.
The government doesn't forgive Parent PLUS Loans when you retire or draw Social Security benefits, but it has programs that will wipe out your remaining balance after you've made a number of student loan payments under an income-driven repayment plan.
Federal Parent PLUS Loans are forgiven when the parent borrower dies or when the child they borrowed the loan for dies. The U.S. Department of Education won't go after the surviving spouse or any other family member to repay the debt.
Your parent PLUS loan may be discharged if you (not the child) become totally and permanently disabled, die, or (in some cases) file for bankruptcy. Your parent PLUS loan also may be discharged if the student for whom you borrowed dies.
Under IDR plans, most borrowers can receive forgiveness in 20 years if they have only undergraduate school debt and 25 years if they have graduate school debt or Parent PLUS Loans.
However, Parent PLUS Loans will be capped at $20,000 per student per year and a $65,000 lifetime limit beginning July 1, 2026. Parents who borrowed before that date can continue borrowing under the current limits for up to three additional years or until their student completes their program. Good news.
Consolidating Parent PLUS loans costs nothing; there are no origination fees. It may simplify your monthly payment if you've been managing multiple payments to different loan servicers. Consolidation can make some types of federal loans eligible for income-driven repayment plans.
Standard repayment plan: Pay off your loan by making fixed monthly payments for 10 years. Graduated repayment plan: Start with smaller payments, then have your payments gradually increase during the 10-year repayment period. Extended repayment plan: Fixed or graduated payments for 25 years.
The "7-year rule" for student loans generally refers to when negative marks, like defaults, are removed from your credit report (around 7 years after the first missed payment or default date for federal loans, 7.5 years for private loans), but the debt itself doesn't disappear and must be paid off; it's also a benchmark in bankruptcy proceedings where federal loans can become dischargeable after 7 years from when payments were due, though proving "undue hardship" is required and difficult.
You will lose repayment plan options and restart the clock on PSLF and other forgiveness programs. You can learn more about the consolidation process here . Act quickly to avoid default. Default can result in consequences like garnishment of your wages, federal tax return, or Social Security.
Look for a lender that offers cosigner release. This allows the primary borrower (your child) to release the cosigner (you) from the loan once they've met specific criteria, such as a having made a certain number of consecutive on-time payments, meeting minimum credit requirements, and providing proof of income.
Parent Plus loans are federal loans that allow parents to borrow money to help pay for their child's undergraduate education expenses. In the event that the parent borrower passes away, the government will discharge and forgive the remaining Parent PLUS loan debt.
Student loan forgiveness programs for seniors. There are no federal student loan forgiveness programs specifically for senior citizens. Retirees are eligible for the same loan forgiveness programs as other borrowers.
Parent PLUS loan borrowers in default face the full range of draconian government collection powers, including wage garnishment, Social Security offsets and tax refund offsets. There is no time limit on government collection.
Register for the Income-Contingent Repayment Plan
Income-contingent repayment (ICR) is the only one that accepts Direct Consolidation Loans that were once Parent PLUS Loans. ICR is a federal program that can lower your monthly payments and offer loan forgiveness after 25 years for eligible applicants.
Parent PLUS Loans are not excluded from PSLF, but they are not eligible for all income-driven repayment plans. Parent PLUS borrowers can consolidate their debt to access the ICR plan and thus, PSLF. ICR is the least generous of the IDR plans.
The Parent PLUS Double Consolidation Loophole offers a unique opportunity to merge your Parent PLUS loans into a single consolidation loan and lower your repayment by 50%. The biggest problem is that this loophole is scheduled to expire on July 1, 2025, but it takes 4 to 6 months to complete.
A Parent PLUS Loan is anything but a plus for your financial goals. In fact, this kind of borrowing is a special kind of toxic because it involves a student and their mom or dad. The only thing worse than debt is the kind that hangs over a family relationship!
Defaulting on a Parent PLUS Loan can have serious financial consequences for student loan borrowers. Here's what happens if you haven't made a payment in more than 270 days: Immediate Consequences: Credit Score Impact: Your default will be reported to credit bureaus, which can significantly lower your credit score.