Big changes have arrived for the federal student loan system, and Parent PLUS Loans are no exception. Following congressional bills and departmental regulation changes, nearly every aspect of student borrowing and repayment has been impacted. Changes to payment plans are one of the most significant changes, as they will ultimately impact almost every single borrower. In addition, borrowers who take out loans starting July 1, 2026 will be subject to borrowing limits. Parent borrowers will still be able to take out PLUS Loans to help their kids pay for college, but will be limited to $20,000 per year, per child. They will also have a lifetime limit to how much they can borrow at $65,000 per child.
Parent borrowers in repayment will now have different options depending on when they took out their loans and whether they consolidated them. New borrowers with Parent PLUS Loans taken out after July 1, 2026 are restricted to the Tiered Standard Plan; there is no other repayment option, regardless of whether or not they try to consolidate. Those who borrowed prior to July 1, 2026 will also have to use the Tiered Standard Plan unless they consolidated prior to that date. If they were successful in consolidating, applied for an Income-Driven Repayment (IDR) plan and made at least one payment prior to July 1, 2026, then they can stay on that plan (the Income-Contingent Plan was the only plan available for Parent PLUS borrowers who consolidated), or they can switch to the Income-Based Repayment plan. ICR will be phased out in 2028, and Parent PLUS borrowers will want to switch over to IBR before then.
If you or your parents (or your friends’ parents!) have Parent PLUS Loans, give us a call. We can help you know what options are available for your repayment, make a plan for potential future borrowing, or just give you peace of mind that you’re on track.
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