Exploring the Deferral Options for Parent PLUS Loans- What You Need to Know

Do parent plus loans get deferred? This is a common question among parents who are considering taking out a Parent PLUS loan to help finance their child’s education. Understanding the deferral options for these loans is crucial for making informed decisions about financial aid and repayment plans.

Parent PLUS loans are federal student loans available to parents of dependent undergraduate students. These loans can be used to cover educational expenses that are not covered by other financial aid, such as tuition, fees, room and board, and books. While Parent PLUS loans offer flexibility and can be a valuable resource for families, it’s important to know how these loans can be deferred and under what circumstances.

When Can Parent PLUS Loans Be Deferred?

Parent PLUS loans can be deferred under certain conditions. The primary circumstances that allow for deferral include:

1. Enrollment in School: If the parent borrower is enrolled at least half-time in a postsecondary educational program, they are eligible for a deferment. This applies to both undergraduate and graduate programs.

2. Unemployment: If the parent borrower is unemployed or experiencing economic hardship, they may qualify for a deferment. This option is subject to verification of unemployment status.

3. Disability: If the borrower becomes disabled and is unable to work, they can request a deferment. This requires documentation from a medical professional.

4. Military Service: Parent PLUS loans can be deferred for borrowers who are serving on active duty in the military, including the National Guard and Reserves.

5. Rehabilitation Training: Borrowers who are participating in a rehabilitation training program for individuals with disabilities may also qualify for a deferment.

How to Request a Deferment

To request a deferment for a Parent PLUS loan, the borrower must complete a Deferment Request Form and submit it to the loan servicer. It’s important to note that deferments are not automatic and must be requested by the borrower. Additionally, interest will continue to accrue on the loan during the deferment period, unless the borrower chooses to pay the interest while the loan is deferred.

Alternatives to Deferment

If a deferment is not an option or if the borrower prefers not to defer the loan, there are other alternatives to consider:

1. Income-Driven Repayment Plans: These plans base the monthly payment on the borrower’s income and family size. Some plans may even allow the borrower to pay nothing if their income is low enough.

2. Forbearance: Borrowers can request a forbearance, which allows them to stop making payments on their loans for a set period. Interest will continue to accrue during this time.

3. Consolidation: Consolidating Parent PLUS loans into a Direct Consolidation Loan can provide borrowers with a new repayment plan and potentially lower monthly payments.

Conclusion

Understanding whether Parent PLUS loans can be deferred is essential for parents who are considering this type of loan to finance their child’s education. While deferment is available under certain conditions, it’s important to be aware of the potential impact on interest accrual and to explore other repayment options that may be more suitable for individual circumstances. By making informed decisions, parents can ensure that they are managing their Parent PLUS loans effectively and responsibly.