Guide to Applying for Parent-Student Loans: Essential Information
Learn the essential steps and eligibility criteria for applying for parent-student loans, including federal and private options. Understand the application process, key providers, and important considerations before borrowing. This guide helps parents make informed decisions about financing their child's education responsibly.
Guide to Applying for Parent-Student Loans: Essential Information
Securing a parent-student loan can be a vital step in financing your child's higher education. These loans are designed for parents to help cover college expenses when other financial aid isn't sufficient. Unlike standard student loans, parent-student loans are typically offered by federal agencies or private lenders, with specific eligibility criteria.
The process involves completing the FAFSA form and possibly applying through specific loan programs on official websites. It's essential to understand the implications of taking on such debt, including repayment obligations and timing, especially considering your retirement plans.
Eligibility Criteria for Parent-Student Loans
Federal parent-student loans require:
Completing the FAFSA application, which assesses your financial situation.
Maintaining a good credit history, as creditworthiness impacts approval.
Additional requirements include:
Having a parent-child relationship where the parent supports the dependent student.
The loan amount is based on the difference between the child's college costs and other aid received.
Important Considerations Before Borrowing
This is a debt obligation that impacts your financial future.
Review your remaining working years and retirement plans before taking such a loan.
Understand the differences, pros, and cons of federal versus private parent-student loans.
Application Process for Parent-Student Loans
Complete the FAFSA form online.
For federal loans, visit studentloans.gov and select the 'Request a PLUS Loan' option.
Only one parent can apply, and must sign the Master Promissory Note with the Department of Education.
Application forms are available on the official websites and typically take about 20 minutes to complete.
Leading Providers of Parent-Student Loans
Citizens Bank
College Ave
LendKey
Connext
Sallie Mae
Research each provider’s terms carefully, weighing the advantages and disadvantages of federal and private options before borrowing.
