Question:
Dear Steve,
I am a mother of 3 girls. They do have student loan debt but are in the process of setting up payments for that debt. My oldest daughter has just gotten married to a guy and he has around 200,000 in student loan debt through parent plus loans and about 20,000 in debt from his own student loan debt.
My question is the payment for the parent plus loans is around $1,500 per month and they are struggling to afford that payment. I know they cannot consolidate into their names, but is it worth trying to get their payments lowered? Do they have any options? Does consolidation of the loans help in any way?
Are there any companies that you recommend for consolidation? They are currently with FedLoan.
I really appreciate your email and wealth of information you have provided to others and I thank you in advance for your help to me.
Lisa
Answer:
Dear Lisa,
I don’t know how old your son-in-law is and it’s not safe for me to assume this $200,000 in Parent Plus loans was for his education or he took this out for his children’s education.
If you can update me in the comments below I can guide you in the right direction.
And yes, the best company to consolidate federal student loans with is the Department of Education. They don’t charge to do it and you still retain your repayment flexibility.
You are not alone. I'm here to help. There is no need to suffer in silence. We can get through this. Tomorrow can be better than today. Don't give up.
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Thank you so much for your help and information.
My new son-in-law is 25. The loans were all his for his education. They also need to get a new car. They are just needing a little guidance and I am not sure how to help them. I really appreciate your help.
So are you the one who took out the Parent Plus loans or was it his parents?
His parents took out the parent plus loans for his education.
Thank you.
The issue with Parent Plus loans is the student can’t do anything about the loans because they are not his loans. They are the responsibility of the parent who signed for them. One option is his parent can consolidate the loans into a new Direct Consolidation Loan and then opt to repay them via an Income-Contingent Repayment plan. See https://studentaid.ed.gov/sa/repay-loans/understand/plans/income-driven
So if his parent explored the income-driven repayment option, could qualify for a lower payment, and was aware of the consequences of such a plan then there are options. See https://stever39.sg-host.com/85779/income-based-student-loan-payments-can-terrible-trap
The parent can get an idea of what the new loan payment would be at https://studentloans.gov/myDirectLoan/mobile/repayment/repaymentEstimator.action
Asked Parent Plus question.