Parent PLUS Loan Forgiveness and Repayment Options in 2025
What Are Parent PLUS Loans?
Parent PLUS Loans are federal student loans that parents can use to help pay for their child’s college. These loans come from the U.S. Department of Education.
They are not based on income or financial need. Instead, they depend on your credit history. Parents can borrow up to the full cost of attendance minus any financial aid that the student receives.
These loans usually have higher interest rates and fewer repayment choices than student loans for students.
Important update for 2025: A Senate bill proposes capping new Parent PLUS Loans at $20,000 per year, with an overall maximum of $65,000, starting in July 2026. This could dramatically limit how much parents can borrow moving forward.
Can Parent PLUS Loans Be Forgiven?
Yes, but forgiveness options are more limited than for other federal student loans. Still, there are four main paths to forgiveness in 2025:
- Public Service Loan Forgiveness (PSLF)
- Income-Contingent Repayment (ICR) Forgiveness
- Total and Permanent Disability (TPD) Discharge
- Borrower Defense to Repayment & Closed School Discharge
Let’s break each one down.
1. Public Service Loan Forgiveness (PSLF)
If you work full-time for a government or nonprofit employer, you may qualify for PSLF. This program forgives your remaining loan balance after 120 qualifying monthly payments (about 10 years).
To qualify with a Parent PLUS Loan:
- You must consolidate your Parent PLUS Loan into a Direct Consolidation Loan
- You must repay it under the Income-Contingent Repayment (ICR) Plan
- You must work full-time (30 hours or more per week) at a qualifying public service job
Important: PSLF is only available to the parent who took out the loan, meaning your eligibility is determined by your employer, not your child’s. It doesn’t count if your child works in public service.
2. Income-Contingent Repayment (ICR) Forgiveness
Parent PLUS Loans don’t qualify for most income-driven repayment plans. But they can qualify for ICR after consolidation. (Psst! It’s possible to qualify for other income-driven plans by taking advantage of a little-known loophole. We’ll discuss this further on in our article.)
Here’s how it works:
- First, consolidate the Parent PLUS Loan into a Direct Consolidation Loan
- Apply for the ICR Plan
- Make your payments in full and on time every month for 25 years, making sure to recertify your plan with your servicer annually
Under ICR:
- Your payment is 20% of your discretionary income
- The repayment length is 25 years (think of it as 300 qualifying payments)
- Any remaining balance after 25 years is forgiven
While this plan doesn’t offer the lowest payments, it’s the only income-based option for Parent PLUS Loans. For many parents, it’s the only way to lower monthly payments.
Legislative watch: A new Senate bill may eliminate ICR for new borrowers and replace it with a stricter "RAP" plan. If you're considering consolidation, act before these changes take effect in July 2026.
3. Total and Permanent Disability (TPD) Discharge
If the parent borrower becomes totally and permanently disabled, the loan may be wiped out entirely.
To qualify:
- Show proof of disability from the VA, SSA, or a doctor
- Meet all paperwork requirements
This discharge clears the debt, and it is not taxed federally through 2025.
4. Borrower Defense to Repayment & Closed School Discharge
If your child’s school lied or misled you, you may qualify for Borrower Defense to Repayment.
This program is rare but can lead to full forgiveness. You must prove the school broke laws or gave false information (like job rates or accreditation).
On the other hand, if your child was unable to complete their education program because their school closed, you may qualify for a Closed School Discharge.
If your child’s school closes on or after July 1, 2023 and you meet the eligibility requirements, your loans may be automatically discharged by the Department of Education. All others will need to apply on their own.
You can apply for both discharge programs online at studentaid.gov.
Repayment Options for Parent PLUS Loans
Parent PLUS Loans have fewer repayment choices. But here are your options:
| Repayment Plan | Monthly Payment | Term | Forgiveness? |
|---|---|---|---|
| Standard | Fixed, higher payments | 10 years | No |
| Graduated | Starts low, rises every 2 years | 10 years | No |
| Extended | Fixed or rising payments | Up to 25 years | No |
| ICR (via consolidation) | 20% of discretionary income | 25 years | Yes, after 25 years |
| PSLF (via consolidation+ICR) | Based on income; $0 possible for some | 10 years | Yes, tax-free |
How to Lower Parent PLUS Payments
If your payments are too high, here are five smart steps:
1. Consolidate to a Direct Loan
Go to studentaid.gov and apply for a Direct Consolidation Loan.
2. Choose the ICR Plan
After consolidating, enroll in ICR. Payments depend on 20% of income.
3. Explore PSLF if you work in public service
Work for a qualified employer and submit the PSLF Certification form yearly.
4. Use deferment or forbearance sparingly
These options pause payments. But interest still adds up and these months generally do not count towards forgiveness.
5. Look into refinancing
Refinancing can lower your rate, but removes federal benefits.
Pros and Cons of Your Options
Pros:
- PSLF and ICR forgiveness are possible
- Consolidation opens the door to Income-Driven plans
- ICR can reduce payments as low as $0
- You have more flexibility with your repayment options
Cons:
- Consolidation is required, which can be timely
- ICR payments can still be high
- ICR takes 25 years to forgive
- No access to SAVE or other new plans
- Refinancing means no federal help
- ICR may go away in 2026
The Double Consolidation Loophole in 2025
A little-known secret that give Parent Plus an advantage is the Double Consolidation Loophole. Most parents consolidate all of their Parent Plus loans together, which allows them to be eligible for the ICR plan. But parents with multiple loans can process two separate consolidations, then perform a second consolidation that brings the two together.
What does this accomplish? Instead of being required to enroll in the ICR plan, double consolidating allows parents to choose from any of the three Income-Driven plan options available.
The Biden Administration set a July 1, 2025 deadline to complete a Double Consolidation, but some recent legal challenges have put that deadline on pause. You’ll want to act now before this changes again, and the experts at Docupop can help you get started.
Parent PLUS Loan Tips for 2025
- Keep your loan current: Default ends your forgiveness options
- Use the Loan Simulator at studentaid.gov to check plans and
- Avoid scams that promise fast forgiveness
- Send in forms every year for PSLF or ICR
- Watch your loan history and employment records
- Pay attention to new laws: Big changes could come in 2026
FAQs About Parent PLUS Loans
Q: Can my child make payments on my Parent PLUS Loan?
A: Yes, but you’re still legally responsible. Additionally, all Income-Driven payments are based on your income, not your child’s.
Q: Do I qualify for SAVE or PAYE plans?
A: No. Parent PLUS Loans can only use ICR after consolidation.
Q: Is forgiveness automatic?
A: No. You have to apply and meet the rules.
Q: Can I consolidate more than once?
A: Yes, if you meet certain requirements. But it might restart your forgiveness clock.
Q: Will forgiven debt be taxed?
A: Not federally through 2025, thanks to the American Rescue Plan Act of 2021. Check your state laws.
Final Thoughts: What Should You Do Now?
Parent PLUS Loans can be tough, but relief is possible. With the right steps, you can cut your payments or even get your debt forgiven.
Start by checking if you qualify for ICR or PSLF. Then, take action. Consolidate your loans, pick the right plan, and keep track of your progress.
If you're thinking of borrowing more, be aware of the new rules that could limit your options by 2026. The “Big Beautiful Bill” proposes eliminating the option for forgiveness for anyone who borrows a Parent Plus Loan after July 1, 2026.
Need Expert Guidance?
👉 Need expert guidance? At Docupop, we specialize in helping borrowers navigate the complexities of student loan repayment, so you don’t have to do it alone. Contact us today to get personalized support and ensure you’re on the right path to managing your student debt.
Don’t wait—take control of your student loans now!
