Parent PLUS loan consolidation impact on forgiveness eligibility - need advice
I just had a weird conversation with my loan servicer about my Parent PLUS loans for my daughter and I'm not sure what to make of it. I have 4 separate Parent PLUS loans totaling about $56,000 that I've been paying on for 3 years. I called FedLoan yesterday to request another hardship deferment (got approved through September), but the rep suddenly suggested I should consolidate these loans to 'remove them from Parent PLUS status' which would supposedly make me eligible for loan forgiveness programs. She mentioned something about converting them to Direct Consolidation Loans? This seems too good to be true - can Parent PLUS loans really be transformed into something eligible for forgiveness? Has anyone done this consolidation process? What are the potential downsides I should watch out for? I'm worried about losing my deferment options or somehow making things worse. Any experiences or advice would be SUPER appreciated!
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Lydia Santiago
becareful with this!!!! i did something similar with my sons loans and the interest rate went UP not down. They told me id get forgiveness but then when I applied they said no because of some technicality about when I took out the loans (2017). Make sure u get EVERYTHING in writing.
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Melissa Lin
•Oh no, that's exactly what I'm afraid of! Did they explain why your loans from 2017 weren't eligible? Mine are from 2019-2021.
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Romeo Quest
Yes, it's possible to consolidate Parent PLUS loans into a Direct Consolidation Loan, which can then make you eligible for Income-Contingent Repayment (ICR) - this is the ONLY income-driven plan available for former Parent PLUS loans. The key benefits: 1. Potential forgiveness after 20-25 years of payments 2. Payments based on your income rather than standard 10-year plan 3. Can help establish eligibility for Public Service Loan Forgiveness if you work for government/non-profit But there are important downsides: 1. Your interest rate will be rounded up to the nearest 1/8th percent 2. You may lose certain deferment options specific to Parent PLUS loans 3. The repayment term extension means paying more interest over time 4. Any unpaid interest will capitalize when you consolidate I recommend looking at the StudentAid.gov loan simulator before deciding - it can show you exactly how the numbers work out in your situation.
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Melissa Lin
•Thank you for this detailed breakdown! I didn't realize ICR was the only plan I could use. Do you know if the deferment options are significantly different? That's been our lifeline during tough times.
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Val Rossi
Done this 4 years ago and my monthly payment dropped from $780 to $412 on ICR plan but you have to recertify income EVERY year or they put u back on standard plan which is WAY higher. The servicers are terrible about reminding u btw
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Melissa Lin
•That's a huge payment difference! Did you have to provide any financial info for your child or just your own income/family size?
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Val Rossi
•just my income and family size - they dont care about the kid's income at all. One weird thing is they counted my spouse's income even tho the loans are just in my name
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Eve Freeman
I tried calling the federal student aid number directly for weeks to ask these exact same questions and kept getting disconnected or stuck on hold forever. So frustrating!!! Does anyone know if there's a way to actually get through to a human who can explain how this works?
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Clarissa Flair
•I was in the same boat - calling for hours with no luck. Finally tried Claimyr.com which got me through to an actual FAFSA rep in about 20 minutes. It connects you directly to their phone system but skips the wait. They have a video showing how it works: https://youtu.be/TbC8dZQWYNQ. Once I got through, they explained all the Parent PLUS consolidation options clearly. Super helpful when you need actual answers from official sources!
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Eve Freeman
•omg thank you!! I'll check this out. I'm desperate to talk to someone who actually knows the rules.
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Caden Turner
Financial aid advisor here - I want to clarify something important about Parent PLUS consolidation. When the rep said it would "remove them from Parent PLUS status," that's somewhat misleading terminology. What happens is you're creating a new Federal Direct Consolidation Loan that replaces your original Parent PLUS loans. This new consolidated loan is still technically derived from Parent PLUS loans, which means: 1. You can ONLY access the Income-Contingent Repayment plan (not PAYE, REPAYE, or IBR which have better terms) 2. The forgiveness timeline is typically 25 years of payments 3. You must consolidate to get ANY income-driven option (unlike other federal loans) Parent PLUS borrowers often get incomplete information from servicers. The smartest approach is to run your specific numbers through the loan simulator on StudentAid.gov before making any decisions.
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Melissa Lin
•Thank you for this clarification! Is there any risk of the consolidation being rejected for some reason? And would I lose my current deferment during the consolidation process?
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Caden Turner
•Consolidation applications are rarely rejected if all loans are federal. The process typically takes 30-60 days, and your loans remain in their current status until consolidation completes. Once consolidated, you'd need to apply for ICR separately - it's not automatic. Your existing deferment won't transfer, but you can apply for economic hardship deferment on the new loan if you qualify.
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McKenzie Shade
DONT DO IT!!!! The government is trying to trick parents into giving up our rights!!! My cousin consolidated her Parent PLUS loans and now they're garnishing her wages because the new loan didn't have the same protections!!! They're all LIARS
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Romeo Quest
•This information is incorrect. Federal Direct Consolidation Loans have the same wage garnishment policies as Parent PLUS loans - both require you to default first, and both offer rehabilitation options. Your cousin likely defaulted on the loan for other reasons. Consolidation doesn't remove protections against wage garnishment.
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Melissa Lin
I just wanted to update everyone - I did more research and spoke with a financial aid counselor at my daughter's university. I've decided to go ahead with the consolidation for these reasons: 1. The payment under ICR will be about $320 lower than my standard repayment plan 2. I'm planning to retire in 12 years, and ICR will adjust to my lower retirement income 3. The slight interest rate increase (0.125%) is worth it for the payment flexibility The application was pretty straightforward on StudentAid.gov. They said it will take about 45 days to process. I'll update again once it goes through! Thanks everyone for your help!
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Lydia Santiago
•good luck!! hope it works out better for u than it did for me!!
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Romeo Quest
•Smart decision! One thing to remember: set a calendar reminder for your annual income recertification. If you miss it, you'll automatically go back to the standard plan, which causes payment shock for many borrowers.
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Natasha Petrova
•Thanks for sharing your decision process! As someone new to this community and dealing with similar Parent PLUS loan questions, this is really helpful. Can I ask - did the university financial aid counselor have any insights about how the retirement income adjustment works with ICR? I'm also wondering about retirement planning with these loans and whether there are any tax implications when the remaining balance gets forgiven after 25 years.
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