Parent Plus Loan (PPL) payment options during school years & current interest rates?

Yes, you can definitely make payments during school! We've been doing this with my son's PPL for the past 2 years. You're not required to, but there's no prepayment penalty. Just call your loan servicer after the first disbursement and let them know you want to make payments. The current interest rate for 2023-2024 PPLs is 8.05%, which honestly isn't great compared to historic rates, but still better than most private loans I've seen. Remember though, interest starts accruing immediately upon disbursement.

just FYI the interest rate changes EVERY YEAR so what ur paying now might not be what it is next year. my parents got 7.54% last year for my brother but now its over 8% like the other person said. kinda ridiculous tbh

I work in financial aid and can clarify a few things: 1. PPL interest rate for 2023-2024 is indeed 8.05%. For 2024-2025, rates will be announced in May. 2. Once you take out a PPL, that specific loan's rate is fixed for the life of the loan. But new loans each year will have whatever the new rate is. 3. You have several repayment options: - Standard repayment (starts after disbursement) - Deferred (no payments until 6 months after graduation) - Interest-only during school - Graduated repayment - Income-contingent (if consolidated) 4. There's also a 4.228% origination fee on PPLs that gets deducted from the disbursement amount. 5. Payments typically apply to interest first, then principal. I recommend contacting your loan servicer directly to set up the payment plan that works best for your family.

We've been paying on my daughter's PPL since her freshman year (she's a junior now) and it's made a HUGE difference!! The loan servicer website made it really easy to set up autopay, which gives a small interest rate reduction too (0.25% I think). Definitely recommend starting payments early if you can!

Be VERY CAREFUL with parent plus loans!!!! The government doesn't care if you can actually afford them - they'll approve almost anyone without major adverse credit history. We took out $25k/year thinking we could handle it and now we're DROWNING in debt. My daughter graduated 2 years ago and we owe over $120k with that crazy interest. Private loans might actually be better if you have good credit!!

has anyone tried contacting FSA directly about repayment plans? i spent 3 hours on hold last week trying to get answers about my parent's PPL and never got through. this whole system is a joke.

To answer your original question more directly: 1. YES, you can absolutely make payments during enrollment periods. It's actually a smart financial strategy. 2. The current Parent PLUS loan interest rate (8.05% for 2023-24) is fixed for the life of that specific loan. 3. Payment allocation: Payments first go to any accrued interest, then to principal. 4. You can pay any amount over the minimum without penalty. Many families make interest-only payments during school to prevent negative amortization. 5. Consider consolidation after graduation if you want access to income-contingent repayment plans. Your loan servicer (not FSA directly) handles all repayment arrangements. Once the first disbursement happens, you'll receive information about creating an account with the servicer.

My sister works in financial aid and she says Parent PLUS loans are actually TERRIBLE deals right now with the high interest rates. She helped me find scholarships and grants instead. Have you exhausted all those options first?

To address your follow-up questions: 1. Yes, after covering accrued interest, you can request that extra payments be applied to principal. You typically need to specify this with each extra payment (either through the servicer's website or by including instructions with manual payments). 2. @profile9 raises a good point about exploring all options. Before committing to the full PPL amount, consider: - Additional scholarship searches (many smaller local scholarships go unclaimed) - Payment plans offered directly by the school (often interest-free) - Work-study if your student qualifies - Minimal federal direct student loans (which have lower interest rates than PPL) 3. You might also want to calculate the total cost of loan repayment using different payment strategies. The loan simulator at studentaid.gov is helpful for this.

As someone who's been through this process, I'd add a few practical tips: 1) Set up automatic payments as soon as your first disbursement hits - the 0.25% interest rate reduction really adds up over time, 2) Consider making payments slightly above the interest-only amount during school years so you're chipping away at principal too, and 3) Keep detailed records of all payments for tax purposes. Also, don't forget that you can deduct up to $2,500 in student loan interest on your taxes each year (income limits apply). The PPL system isn't perfect, but with careful planning it can be manageable. Good luck with your daughter's education!