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I’m paying my own and my mom’s student loans to the tune of $ 80K. Can you help?

Some private lenders may allow you to take over a Parent PLUS loan through refinance, but private lenders typically don’t offer income-based repayment, and you’d lose other benefits that come with government loans – like, for example, the current interest -free payment pause on federal loans and eligibility for federal programs that involve loan forgiveness.

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Question: Is there any way to consolidate Parent PLUS Loans with my regular student loans? Not only are the Parent PLUS loans higher interest than my own loans, they don’t currently count towards seeking an income-based repayment plan because they are under my mother’s name, even though I have been the one paying them. Combining them would put me at over $ 80K in student loan debt and income-based repayment would then actually help.

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Answer: The short answer is no: Parent Plus Loans cannot be directly consolidated with a student’s federal student loans. This means you can only qualify for income-based repayment (IBR) through the amount of your own loans.

Some private lenders may allow you to take over a Parent PLUS loan through refinance, and you could qualify for lower rates. But private lenders typically don’t offer income-based repayment, and you’d lose other benefits that come with government loans – like, for example, the current interest-free payment pause on federal loans and eligibility for federal programs that involve loan forgiveness .

That said, Cecilia Clark, student loan expert at NerdWallet, proposes that after the payment pause is over (payments on federal student loans are now paused through May 1, 2022), refinancing through a private lender may be worth considering if you have stable income and can qualify for a lower interest rate and lower payment. However, look carefully at what rates and terms you’re offering on a refund: “The interest rate you might get approved for might be the same or substantially higher than the rate you’re currently paying on the Parent PLUS loans. This will depend on the current interest rate environment and your personal financial profile, including your credit history and income, ”says Akeiva M. Ellis, a certified financial planner.

If the terms you’re offered on the refi aren’t great, you might want to consider having your mother co-sign the loan, adds Andrew Pentis, certified student loan counselor and education finance expert at Student Loan Hero. But do your homework whatever you decide: “Refinancing isn’t for everyone and it would irreversibly strip the federal loan of its government exclusive protections,” he adds.

If refinancing isn’t right for you, consider switching the parent loan to an income-contingent repayment plan (ICR) that could cap monthly dues at a percentage of your discretionary income, says Pentis. ICR is the only income-driven repayment plan available to Parent PLUS borrowers, and the program caps payments at 20% of your discretionary income or the amount of your fixed monthly payments on a 12-year loan term if that’s lower. With this plan, forgiveness is awarded after 25 years of payments and your mother would have to swap the PLUS loan for a direct consolidation loan to become eligible for ICR. The loan would still be in your mom’s name, but at least the monthly payment would very likely be lower.

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