Hello, I’m trying to help my parents figure out how to handle parent plus loans they’ve taken out for my siblings and me. All the loans are in my mom’s name and she is working towards PSLF.
The loans have been consolidated and placed on ICR (and will be on IBR soon once a payment is made). We know she can’t take out any more student loans after July to maintain this status. My question is about two separate loans not a part of the consolidation.
She has a smaller parent plus loan that is not a part of the consolidation. After the sunset period it seems this loan will lose eligibility for all income based repayment. I read about a rule that all loans must be on the same payment plan. Does this apply even if all loans are legacy (taken out before July)? Or only for new borrowers?
She also has a federal loan for her personal schooling. If this loan is placed on IBR can it exist in conjunction with the ppl consolidation on IBR as well? This seems to abide by the aforementioned singe plan rule….
Please any advice is greatly appreciated. It seems you basically need to be a lawyer to understand everything going on and I’m worried my parents don’t know the ins and outs.
Consolidated PPL with additional loans?
byu/Good_Artichoke_9467 inStudentLoans
Posted by Good_Artichoke_9467
3 Comments
The single payment plan rule is pretty confusing but from what I understand it only applies to new borrowers after the changes take effect. Your mom should be fine keeping different legacy loans in separate plans since they were all taken before July cutoff
For the unconsolidated parent plus loan – yeah that one is going to lose IBR eligibility which sucks. She might want to consider adding it to existing consolidation before deadline if that makes sense financially. The personal federal loan should be able to stay in IBR alongside the consolidated PPL as long as both are legacy loans
PSLF tracking can get messy with multiple loans so definitely keep good records of all payments. Maybe worth talking to loan servicer directly about this since rules are still being clarified and they should know current guidance
Suggest visiting r/PSLF, too.
There’s an exception for the single plan rule specifically for the situation you describe. With that said she can do a 180 day add on to get that straggler into the consolidation