Key insights
- The article discusses the impact of Parent PLUS loans on parents' credit scores, noting that missed payments can negatively affect creditworthiness and access to other loans. Upcoming restrictions on borrowing amounts in 2026-27 may slightly reduce future debt burdens. The relatively small number of Parent PLUS borrowers compared to undergraduate borrowers suggests a limited, slightly negative impact on overall consumer credit and spending.
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Parents of dependent undergraduate college students can take out a Parent PLUS loan to help pay for their child's tuition and fees. Any missed payments are on them and their credit.
The loans are their legal responsibility and can't be transferred to the student, even after graduation.
Applying for a Parent PLUS loan triggers a hard inquiry on a credit report. Parents with an adverse credit history can be denied unless they have an endorser or can document extenuating circumstances.
A hit to your credit from missed Parent PLUS loan payments can make it harder to take out other types of loans and likely increase the interest rate you'll pay.
Not all families borrow through the Parent PLUS program. About 550,000 parents took out Parent PLUS loans in 2024-25, compared with 5.1 million undergraduates who borrowed, according to the College Board's most recent report.
Parents who borrow typically take on more debt than their children. During the 2019-20 academic year, Parent PLUS borrowers took out an average of $16,273, according to the most recent data available from the National Postsecondary Student Aid Study. That compares with the $4,090 in student loans that an average undergraduate student borrowed the same year, according to the College Board.
Starting in the 2026-27 academic year, Parent PLUS loans will be more restricted. Previously, parents could borrow up to the full cost of attendance; the new rules cap borrowing below that.
Repayments start soon after a PLUS loan is disbursed, unlike student loan payments, which don't begin until after graduation.
A parent becomes delinquent after one missed payment, but servicers don't report it to credit bureaus until payments are 90 days past due.
Missed Parent PLUS payments can stay on your credit report for up to seven years.
If a borrower continues to skip payments for more than 270 days, they are considered in default and risk having their wages or federal benefits garnished. After default collections were paused during the COVID-19 pandemic, student loan garnishments have yet to fully resume.
The only income-driven repayment plan available to Parent PLUS borrowers is the Income-Contingent Repayment (ICR) plan, which lowers monthly payments based on income.
Parent PLUS borrowers must consolidate their loans now to be eligible for an income-driven repayment plan after July 1, 2026. In addition, parents who borrow PLUS loans after that date can only use a standard repayment plan.
Current borrowers can also choose extended or graduated repayment plans, which prolong the term and lower monthly payments without factoring in income.
Parents can also request forbearance or deferment from their loan servicer, including requesting a deferment while their child is still in school.