Parent PLUS loans are not automatically renewed; they require a new application, credit check, and FAFSA filing every academic year. Approval in a previous year does not guarantee approval for future years. Parents must reapply annually at studentaid.gov to continue receiving funding.
You must complete a Direct PLUS Application for each year you wish to receive a parent PLUS loan.
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.
Parent PLUS Loans can be forgiven when you retire
Parent PLUS Loan borrowers can have their debt forgiven after 10 years of working full-time for the government, nonprofit, or other qualifying employers.
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.
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.
Generally, you'll have from 10 to 25 years to repay your loan, depending on the repayment plan that you choose. Your required monthly payment amount will vary depending on how much you borrowed, the interest rates on your loans, and your repayment plan.
Are student loans forgiven when you retire? No, the federal government doesn't forgive student loans at age 50, 65, or when borrowers retire and start drawing Social Security benefits.
Parent PLUS loan borrowers will be limited to $20,000 a year per student. Parent PLUS loan borrowers' lifetime aggregate limit will be $65,000 per student. Direct student loan offers will be prorated for students who are enrolled less than full time.
Grandfather provisions:
There is a grandfather clause for Grad PLUS Loan borrowers, students who are currently borrowing under any Federal Direct Loan provision, may borrow for an additional three years or the completion of their program, whichever comes first.
Undergraduate Limits and Parent PLUS Loans
There are no changes for undergraduate loans, although undergraduate loans will count towards the new lifetime limits. However, starting July 1, 2026, Parent PLUS loans will be capped at $20,000 per student per year, with a $65,000 lifetime limit per dependent student.
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.
Parent PLUS Loan borrowers now have an annual borrowing limit of $20,000 per student and a lifetime aggregate limit of $65,000 per student.
If you have defaulted on your federal student loans and you receive Social Security Disability or retirement benefits, the federal government may withhold up to 15% of your benefits each month to pay back your student loan debt, as long as your remaining monthly benefit stays above $750. This is called an offset.
The HECM is the FHA's reverse mortgage program that enables you to withdraw a portion of your home's equity to use for home maintenance, repairs, or general living expenses. HECM borrowers may reside in their homes indefinitely as long as property taxes and homeowner's insurance are kept current.
Here are seven other options:
As a parent PLUS borrower, can I transfer responsibility for repaying the loan to my child? No, a Direct PLUS Loan made to a parent cannot be transferred to the child.