Are FAFSA college monthly payment plans excessive compared to Parent PLUS loans?

The monthly payment plans through schools aren't typically "high" in terms of interest - they usually have modest administrative fees instead of actual interest. The monthly amount feels high because you're compressing a semester's cost into just 4 months rather than spreading it across a longer period like a loan would. For your $8,300 per semester, that's why it's $2,075/month. With Parent PLUS loans, the current interest rate is 6.28% (though that can change for 2025-26), PLUS there's a ~4% origination fee taken out upfront. You'll pay less per month initially, but significantly more over time. If you can afford those monthly payments, the school payment plan will almost always be cheaper in total cost than Parent PLUS loans.

my family did the monthly payment plan for my first yr and then switched to parent plus bc the monthly payments were 2 difficult... we couldnt keep up with them cuz they were due during the semester while my dad was paying for my brothers tuition 2. parent plus sucks but at least the payments r spread out longer

The payment plans aren't high in terms of interest - they usually just have a small administrative fee ($50-100 per semester typically). They feel expensive because you're paying the full amount in a compressed timeframe. Here's how to compare your options: 1. Payment Plan: $8,300 + modest fee (maybe $75) = ~$8,375 total cost - Divided into 4 payments = ~$2,094/month - Paid off in 4 months - No long-term debt 2. Parent PLUS Loan: $8,300 with 6.28% interest + 4.228% origination fee - Loan amount after fee: ~$7,949 (they take fee from principal) - 10-year standard repayment: ~$89/month - Total paid over 10 years: ~$10,680 So you save about $2,300 with the payment plan, but it requires much higher monthly payments in the short term. Have you looked into whether your daughter qualifies for additional scholarships? Or possibly a part-time campus job through Federal Work-Study to reduce the amount needed?

The monthly payments ARE high but thats because your paying it off quick. My daughter's school offered 5 month plans which helped a bit. What we did was use the payment plan for half the amount and took a small parent plus loan for the rest. kind of a middle ground approach that worked for us.

Has anyone else spent HOURS trying to reach someone at Federal Student Aid to discuss loan options?? I wanted to ask about Parent Plus vs private loans but I literally can't get through to a human being. SO FRUSTRATING!!!!!

One option you haven't mentioned - have you checked with your employer about tuition benefits? Some companies offer assistance even for employees' children. Also, some colleges will adjust their aid packages if you explain financial hardship - it's called a Professional Judgment review. You'd need to contact the financial aid office directly and explain why the FAFSA-generated SAI doesn't accurately reflect your ability to pay.

Don't overlook community college for the first two years!! My daughter did her gen eds at community college while living at home, then transferred to her dream school for junior/senior years. Saved us over $40,000 and she's graduating with the EXACT SAME DEGREE as her friends who went there all four years. The payment plan was actually manageable for community college because the base cost was so much lower.

After reviewing your situation more carefully, here's what I would recommend: 1. First, check if your school offers an extended payment plan option. Some schools have 5 or 6-month plans that can lower the monthly amount. 2. Consider the hybrid approach someone mentioned - perhaps $1,000/month on the payment plan and a smaller Parent PLUS loan for the remainder. 3. Make sure your daughter has maximized her Direct Subsidized/Unsubsidized loan eligibility before you take on any Parent PLUS debt. 4. Remember that Parent PLUS interest begins accruing immediately after disbursement, not after graduation like some student loans. 5. If you do choose the Parent PLUS route, consider making interest-only payments while your daughter is in school to prevent the balance from growing. The most cost-effective approach is usually the payment plan, but it has to be realistically affordable for your monthly budget. No point in committing to payments you can't make.