I’m trying to figure out if I’m making a mistake with how I’m handling my student loans.
I have about $86K in Parent PLUS loans (in my parents’ name):
– ~$26K @ 7.08%
– ~$25K @ 5.30%
– ~$26K @ 6.28%
– ~$9K @ 7.54%
Right now I’m paying about $3,000/month toward them, with $2,000 going to the highest interest loan and the rest covering minimums.
The part I’m struggling with is that my parents aren’t contributing toward the loans, even though they are in their name. Early on, I also thought money had been paid toward the balance, but it turned out that was from refund checks tied to the loans, not separate payments.
At this point I’m trying to balance:
– Paying these down aggressively
– Saving money each month
– Planning for future financial goals
I don’t mind contributing, but I’m starting to question whether it makes sense to be paying this much toward loans that aren’t legally mine while also trying to move forward financially.
Would it be smarter to:
– Keep aggressively paying them down
– Scale back payments and focus more on saving/investing
– Or try to restructure how these are being handled with my parents
Just looking for some outside perspective on what a reasonable approach would be.
Paying $3,000/month on Parent PLUS loans while my parents pay nothing , not sure if I’m handling this right
byu/GringoTigre inStudentLoans
Posted by GringoTigre
9 Comments
They took out loans for you to go to college, no? Although “legally” they’re not in your name, if it’s for your education you should be 100% paying these off. They took out a loan, putting their name and credit on the line, and you want to essentially stab them in the back?
Unless there’s just some misunderstanding and your parents are willing to pay back this loan, you are the biggest scum bag ever to try and throw this loan in your parent’s face. They were doing you a favor.
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Legally, you can stop paying and have your parents deal with it.
Morally? Depends if they forced you to go to college, if you would have gotten a free ride at a different college instead, and if the college loans were taken out for your benefit or for their bragging rights.
Depends on what you agreed to when they took out the loans.
Please elaborate on “refund checks.” The only time I got refund checks is if my student loans were more than needed for classes and dorm. I’m pretty sure that i sent that money back to the lender or asked my school to send it back to the lender if they offered me a refund of the surplus.
If your parents’ Plus Loan records have “refunds listed”, what does that mean?
* Did the loan have surplus funds returned to it?
* Did your parents receive the refunded surplus funds?
I tend to agree with the spirit of the student repaying Parent Plus loans, if they can afford to, but if your parents received cash that didn’t go to your education, either tuition or dorms, then that changes the equation quite a bit.
I would say that all of you should get together and discuss the situation. Obviously, it’s wonderful that your parents took a parent plus lunch to support your education. Many families can’t afford college at all and if you’re not wealthy parent plus loans were the way to do it. Yes usually you will get access back if you have less cost than the loan. Then again your parents are probably struggling to balance all their finances as well. I would say you should work out a plan where split the payment with them
This isn’t really a question of what makes the most financial sense, it’s a relationship question. You need to sit down with your parents and discuss it. Even if they still want you to fully pay the loans, what you decide to do is going to impact their financial situation, too. You could decide to just stop paying and they’d be the ones hit with the credit issues and financial problems. Did you and your parents agree to anything in terms of repayment setup when the loans were taken out?
If you agreed to pay when your parents got the loans, then you should morally keep paying.
If you are only supposed to be helping, then I would be less aggressive.
>(in my parents’ name)
You don’t have to pay a dime in this situation. It’s in your parents’ interest to negotiate with you because you hold the cards. They are on the hook for the loans, and the loans die with them.