Starting next summer, approximately 3.5 million Parent PLUS loan borrowers risk losing access to income-driven repayment (IDR) and potential student loan forgiveness—unless they act quickly.
To lock in lower payments and maintain access to forgiveness options, borrowers must consolidate their loans before July 1, 2026. Missing this deadline means being stuck with the standard repayment plan, which can be harder to manage compared to income-driven plans.
The standard repayment plan is based on fixed monthly payments that cover the total amount owed, while income-driven repayment plans adjust payments based on income and family size. These IDR plans can also extend the repayment term and forgive any remaining debt after the term ends.
These changes in eligibility stem from former President Trump’s “one big, beautiful bill” that reshapes the federal student loan system. If you’re a Parent PLUS borrower, here’s everything you need to know to secure IDR and loan forgiveness benefits.
What’s Changing for Parent PLUS Loan Repayment?
Starting July 1, 2026, any new Parent PLUS loans will no longer be eligible for income-driven repayment. Borrowers will only be able to use the standard repayment plan.
However, existing Parent PLUS borrowers still have an opportunity to retain IDR eligibility, though the available plans are changing. Currently, these borrowers qualify for Income-Contingent Repayment (ICR), the least generous of the four IDR options. But by 2028, ICR will phase out, and borrowers will have the opportunity to move to Income-Based Repayment (IBR), a slightly more generous plan.
Check your potential payments for both ICR, IBR, and the standard plan using the U.S. Department of Education’s loan simulator.
Please note: Parent PLUS loans are not eligible for the new Repayment Assistance Plan (RAP) under the Education Department’s recent changes. For further details, visit their official website.
Why Should Parent PLUS Borrowers Choose Income-Driven Repayment Plans?
Public Service Loan Forgiveness (PSLF) Opportunity
Parent PLUS borrowers can qualify for Public Service Loan Forgiveness (PSLF) if they work in a qualifying government or nonprofit role. To take advantage of PSLF, parents generally need to consolidate their Parent PLUS loans and enroll in an income-driven repayment plan.
4 Essential Steps to Keep Your Parent PLUS Loans Eligible for IDR
If you’re a Parent PLUS borrower, it’s crucial to act before the deadlines to secure your IDR eligibility and possible forgiveness. Here’s a simple guide to help you stay on track:
1. Verify Your Loan Type
Start by logging into your studentaid.gov account. Review your loan details to confirm if you have Parent PLUS loans, whether they’re already consolidated, and what repayment plan you’re currently on.
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If you’re already enrolled in the ICR plan, you’ve already consolidated your Parent PLUS loans. You can skip ahead to step 4.
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If not, follow the next steps to consolidate and switch your plan.
2. Consolidate Your Parent PLUS Loans ASAP
To access income-driven repayment, you’ll need to consolidate your Parent PLUS loans through studentaid.gov. Consolidation merges one or more federal loans into a single loan, often with more favorable repayment options.
To qualify for IDR, complete consolidation by June 30, 2026. The consolidation process can take up to six weeks, so aim to submit your application by mid-May at the latest.
Consolidation is free, and the process is typically completed online in under 30 minutes. You’ll also have the option to select a new student loan servicer during the process.
3. Enroll in the ICR Plan Before July 2028
Once your loans are consolidated, you must enroll in the Income-Contingent Repayment (ICR) plan before it phases out. If you haven’t already selected ICR during the consolidation process, you’ll need to enroll by July 1, 2028.
ICR caps your payments at 20% of your discretionary income, with a repayment term of 25 years.
4. Make One ICR Payment, Then Switch to IBR Before July 2028
After enrolling in ICR, you must make at least one on-time payment to continue the process. Once you’ve made that payment, submit your application for Income-Based Repayment (IBR) via studentaid.gov/IDR.
IBR offers a more generous plan, capping payments at either 10% or 15% of your income (depending on when you borrowed), with repayment terms of 20 or 25 years.
Remember: You must complete your IBR enrollment by July 1, 2028.
Key Deadlines for Parent PLUS Loan IDR Eligibility
| Deadline | Action Required |
|---|---|
| July 1, 2026 | Complete the loan consolidation process. |
| Before July 1, 2028 | Enroll in the Income-Contingent Repayment Plan (ICR) and make at least one full payment. |
| July 1, 2028 | Enroll in the Income-Based Repayment (IBR) plan. |
Important Tip:
Don’t fall for companies charging fees to “help” with consolidation. Consolidation is a free process through studentaid.gov.
What Happens if You Take Out Parent PLUS Loans After July 2026?
Any Parent PLUS loan borrowed after July 1, 2026 will make all of your Parent PLUS loans ineligible for income-driven repayment options, even if you took out loans before that date. You’ll be forced to use the standard repayment plan for all your loans.
Additionally, borrowing limits for Parent PLUS loans will change after July 1, 2026:
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Up to $20,000 per year per student
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Up to $65,000 total per student
If you took out loans before this date, you can continue borrowing based on the full cost of attendance, for up to three years, or until your child finishes school, whichever comes first.
Need Help with Your Parent PLUS Loan?
Keeping accurate records of your loan applications, payments, and correspondence with your loan servicer is essential. If any issues arise, it’s helpful to have a paper trail of your interactions.
If the consolidation and repayment process feels overwhelming, don’t worry! You can get free assistance directly from your loan servicer. For additional guidance, check out the U.S. Department of Education’s resources, or reach out to trusted organizations that specialize in student loan repayment.
By acting before these crucial deadlines, you can secure a more manageable repayment plan and ensure you remain eligible for loan forgiveness options. Be sure to follow the steps outlined here to safeguard your financial future and protect your family’s investments in education.
For more updates and tools to manage your credit and student loans, visit Creditvana.com today!
