Hi, writing this on behalf of my parents who aren't great with computers. Would love some advice as the new laws have changed slightly, so I want to make sure I'm understanding correctly.
When my sibling and I enrolled in college, my parents took out Parent Plus loans for both of us. We have always known that we would be repaying our own individual loans, and do not expect our parents to contribute. I went to 4 years of college, my sibling has a master's degree and 8 years of college.
We would like to consolidate our PP loans into 2 separate ICR loans, so that we can lump all of my loans together into 1 loan, and so my sibling can lump all of their loans together in 1 loan.
Questions:
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With the new OBBB, I believe it is no longer necessary to do a "double consolidation" to access ICR plans, is that correct?
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I have tried to look this up and couldn't find clear info, but is it actually possible to split up Parent Plus loans into 2 different loans so that they can be separated by each child?
We want to do this so that we can clearly track our individual loan progress more accurately. The problem we're dealing with now is that our total loan amounts / interest amounts are enmeshed, and it's becoming difficult for us to fairly split our loans. For example, my loans are less because I attended less years of college, so I would be finished paying "my" portion of the loan off earlier, but the matter of all the combined total interest is a little tricky.
- After consolidating into the two separate ICR loans, is it correct that the next step would be paying 1 payment minimum and then consolidating again into an IBR plan? It's my understanding that the ICR plan is going away and we need to have already consolidated onto this plan to be eligible for IBR.
Sorry for all the questions, this is a complicated situation to navigate! To be totally frank, my parents are pretty financially illiterate and are terrible with computers. I'm getting all of this info to help with this process because I don't think they would be able to do all of this by themselves. So any and all input is sincerely appreciated, thank you!
Parent Plus Loans for 2 children – Consolidating to ICR
byu/asking-questions29 inStudentLoans
Posted by asking-questions29
2 Comments
Thank you in advance for any help!!! I know we’re a little late to the suggested consolidation timeline of April 1st, I am stressing out lol ðŸ˜ðŸ˜‚
Double consolidation is unnecessary and you absolutely don’t have time to so so.
And unfortunately you only possibly have time to use the online consolidation application (not the paper application) once. So your parent would have to consolidate all of their parent plus loans (taken out for both you and your sibling) to create a new direct consolidation loan eligible for ICR and then IBR.
And to hopefully get it finished before the deadline, they really need to start the process right now. Hopefully it would be done in time but there is a chance that it won’t be.
You would have to decide with your sibling and your parent how you want to split the payments between you. The interest will be capitalized when consolidating everything (become part of the new principal). So you can add your individual principal and interest amounts together now to understand what you and your sibling’s share of the total debt is.