Mark your calendars! The Parent Plus student loans will undergo changes on July 1, 2026. https://www.ppsl.org/ outlines the changes for you, so you can be ready to be ready.
What’s Changing?
New Borrowing Limits Starting on July 1, 2026:
- Parents can borrow up to $20,000 per year for each child enrolled in college
- There is a lifetime limit of $65,000 per child
Loss of Access to Some Affordable Repayment Plans, also starting on July 1, 2026
- Parents who do not consolidate their Parent PLUS loans by this date will no longer be able to use Income-Driven Repayment (IDR) for those loans.
- Income-Driven Repayment (IDR) allows borrowers to set their monthly payment based on their income, which can lower (or zero out) a borrower’s monthly payment. IDR also offers loan forgiveness after 20-25 in repayment and can help borrowers in public service qualify for Public Service Loan Forgiveness (PSLF) after just 10 years.
- Parents who take out any new federal loans will also lose access to IDR for their Parent PLUS loan. This will apply to all a borrower’s Parent PLUS loans, including loans borrowed (or consolidated) before July 1, 2026.
Image by Gerd Altmann from Pixabay
What Can You Do?
If You Already Have a Parent Plus Loan and Don’t Need to Borrow More
You can keep your eligibility for income-driven repayment (IDR) only if you consolidate your Parent PLUS loans by July 1, 2026. You will then need to enroll in IDR and make one full payment before July 1, 2028. The Department of Education recommends applying for consolidation no later than April 1, 2026 to ensure your application is processed in time. The time to consider your options is now.
While consolidating your loans and applying for IDR can lower your payments, borrowers should carefully review their options. Parent PLUS borrowers should consult the following resources:
- The Department of Education provides information on loan consolidation and Income-Driven Repayment (IDR) on its website. You can use those links to review information and to apply for consolidation.
- You can also contact your loan servicer with questions about consolidation and IDR. If you do not know your loan servicer, you can find their information here.
- You can also find information on the National Consumer Law Center (NCLC)’s Student Borrower Assistance Project here. You can review their guidance on Parent PLUS changes here.
If You Do Not Have a Parent Plus Loan and Plan To Borrow in the Future
Know that any Parent PLUS loans you take out after July 1, 2026:
- Cannot be repaid using IDR, or qualify for loan forgiveness via IDR or Public Service Loan Forgiveness (PSLF)
- Must be repaid via a fixed, monthly payment that requires you to repay the loan in full over 10 to 25 years.
Families without access to enough funding through grants, scholarships, and federal student loans to cover the cost of tuition may consider borrowing private student loans, but beware—private loans are usually more expensive and always less flexible than federal loans (including Parent PLUS loans). Make sure that you review and understand the written terms of your private loan, such as interest rate, monthly payments, and total cost of your private loans before you sign for them. You can learn more about private student loans here.
If You Already Have a Parent Plus Loan and Plan to Borrow in the Future
You can preserve your eligibility for income-driven repayment (IDR), but you must stop all borrowing by July 1, 2026. You must also consolidate your Parent PLUS loans by July 1, 2026, and make one IDR payment by July 1, 2028. To ensure your application is processed before this legal cutoff, the Department of Education recommends applying by April 1, 2026.
While consolidating your loans and applying for IDR can lower your payments, borrowers should carefully review their options. Borrowers can consult the following resources or reach out to PPSL with questions:
- The Department of Education provides information on loan consolidation and Income-Driven Repayment (IDR) on its website. You can use those links to review information and to apply for consolidation.
- You can also contact your loan servicer with questions about consolidation and IDR. If you do not know your loan servicer, you can find their information here.
- You can also find information on the National Consumer Law Center (NCLC)’s Student Borrower Assistance Project here. You can review their guidance on Parent PLUS changes here.
Families without access to enough funding through grants, scholarships, and federal student loans to cover the cost of tuition may consider borrowing private student loans, but beware—private loans are usually more expensive and less flexible than federal loans (including Parent PLUS loans). Make sure that you review and understand the written terms of your private loan, such as interest rate, monthly payments, and total cost of your private loans before you sign for them. You can learn more about private student loans here.
Key Changes Effective July 1, 2026
Here is a recap that will be implemented in the Parent PLUS loan program on July 1st:
New Borrowing Limits
- Annual Limit: Parents can borrow up to $20,000 per year for each child enrolled in college.
- Lifetime Limit: There is a cap of $65,000 per child for the total amount borrowed.
Loss of Income-Driven Repayment Access
- Parents will lose access to Income-Driven Repayment (IDR) plans unless they consolidate their Parent PLUS loans by July 1, 2026.
- IDR plans allow borrowers to set monthly payments based on income, potentially lowering payments or qualifying for loan forgiveness after 20-25 years.
Consolidation Deadline
- To maintain eligibility for IDR, parents must consolidate their Parent PLUS loans by July 1, 2026.
- It is recommended to apply for consolidation by April 1, 2026, to ensure timely processing.
Implications for Future Borrowers
- Any new Parent PLUS loans taken out after July 1, 2026, will not qualify for IDR or Public Service Loan Forgiveness (PSLF).
- New loans must be repaid through fixed monthly payments over a period of 10 to 25 years.
These changes are part of broader reforms aimed at restructuring federal student loan programs, impacting how families finance higher education.
Image by GO Educational Tours from Pixabay
Legislative Changes Impact ALL Planning
Planning is a funny thing. The saying “the best laid plans of mice and men” is another way of saying that no matter how well you try to prepare for something, something could still occur, leading to a shift in plans.
We’ve experienced several legislative changes over the years. Laws around finances, investing, estates, benefits, loans, and healthcare directives shift more often than most people realize. These changes are a reminder to review your plans often. “Once and done” is not recommended!
If you’d like help planning or talk through your specifics, please click Book a Time with Lynn for a complimentary 30-minute Zoom with me. OR, send me a note via Email. Check out what I offer @ The Living Planner.
Summer is a great time to read! For pre-planners, my book is an easy read with short chapters that highlight specific topics to help you prepare. The 2026 edition of Living Planner What to Prepare Now While You Are Living © has been printed! Check it out HERE.
Quote of the week: “The best laid plans of mice and men can still go wrong,” by Scottish poet Robert Burns, written in 1785.
The little things matter – Lynn
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