The Best Parent Student Loans in 2024: How to Choose Among Parent PLUS and Private Options

Federal Parent PLUS Loans are often the best starting point for parents, offering fixed rates, flexible repayment options, and federal protections. However, for those with strong credit, private parent loans may provide lower interest rates and no origination fees, making them a cost-effective alternative.

Comparing federal and private options can help you find the ideal balance between affordability, flexibility, and support for your child’s education.

Lender	Best for	LendEDU rating
Dept. of Education	Federal parent loans	Not rated
College Ave	Private parent loans	5/5
Earnest	Large loans	4.7/5
SoFi	Member benefits	4.7/5

Federal Parent PLUS Loan

For parents who want to keep their child’s financial burden low or have already maxed out their child’s federal loan options, a Parent PLUS Loan can be an excellent option to cover remaining educational costs.

Parent PLUS Loans often make a good first choice due to federal protections and flexible repayment options, though they come with a higher interest rate and an origination fee compared to many private loans.

Term	Details
Rates	Fixed at 9.08%
Origination fee	4.228%
Credit check?	✔️
Loan limits	100% of cost of attendance, less other financial aid
Terms	10 – 25 years
In-school repayment options	Partial, full, or deferred
Grace period	6 months after the child leaves school

To qualify for a Parent Plus Loan, your child must attend school at least half-time. The loans don’t require a specific credit score. Instead, eligibility hinges on a review of your credit history for “adverse credit events.” The Department of Education defines “adverse credit history” as:

A debt that’s 90 days or more delinquent with a balance over $2,085
A bankruptcy, foreclosure, repossession, tax lien, wage garnishment, or default determination within the last five years

If you have adverse credit, you may still be able to qualify by either:

Getting an endorser: Similar to a cosigner, this individual agrees to repay the loan if you can’t. However, your child cannot serve as an endorser.
Appealing your credit decision: You can appeal if you can provide documentation of extenuating circumstances. Note that if you go this route, you’ll need to complete PLUS Credit Counseling as well.

For further details on options for parents with credit challenges, see our student loans guide for parents with poor credit.

Parent PLUS Loans offer key federal protections that can make repayment easier if finances are tight. These benefits include:

Income-Contingent Repayment (ICR): By consolidating your loan, you can qualify for ICR, which adjusts monthly payments based on your income.
Deferment and forbearance: Temporarily pause payments if you face financial hardship, unemployment, or other qualifying situations.
Public Service Loan Forgiveness (PSLF): If you consolidate and work for a qualifying employer, you could be eligible for loan forgiveness after meeting PSLF requirements.

These protections can make Parent PLUS Loans a flexible, secure choice for many families.

Tip

Before applying for a Parent PLUS Loan, your child should fill out the FAFSA and wait to receive their financial aid award letter to see what other aid they can get.

Best private parent student loans

When choosing between federal and private loans, federal Parent PLUS Loans are often a first stop, thanks to their federal protections, fixed interest rate, and repayment flexibility. However, private parent loans can be a strong choice in situations where:

Interest rates: Private loans may offer lower rates for parents with strong credit, which can reduce overall borrowing costs.
No federal limits: If you’ve hit federal borrowing caps, private loans can help fill the gap.
Fee savings: Many private loans come with no origination fees, unlike Parent PLUS Loans, which charge a 4.228% fee.

While private parent loans lack federal deferment options, income-driven repayment, and forgiveness programs, they can provide interest rate and fee advantages that make them appealing in certain situations. Below, we’ve identified some of the top private student loans for parents.

College Ave

Best Overall

5.0 _/5

LendEDU Rating

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Why it’s one of the best

College Ave offers student loans, including parent loans, and you don’t need to be a parent to qualify. You can take out a College Ave parent loan on behalf of your grandchildren, nieces or nephews, or a student for whom you have legal guardianship.

With three repayment options over five to 15 years, College Ave loans can work for almost every budget. But College Ave doesn’t provide a grace period. You must pay at least your monthly interest charges while your child is in school.

Flexible repayment plans and terms
No application, origination, or prepayment fees
3-minute application

Loan details

Rates (APR)	4.22% – 17.99%
Loan amounts	$1,000 – 100% of certified costs
Repayment terms	5 – 15 years

Eligibility requirements

Must be a U.S. citizen or permanent resident
Must pass credit history and income review
Student must attend an eligible institution
Student must meet the school’s satisfactory academic progress (SAP) guidelines

Earnest

Best for Large Loans

4.7 _/5

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Why it’s one of the best

Earnest lets parent borrowers defer payments while their children are in college. Then when your child leaves school, you’ll enjoy a nine-month grace period before any payments are due. You can use that time to pay down your principal, but you’re not required to pay anything.

Earnest matches competitors’ rates and offers a 0.25% autopay discount, ensuring you get the best rate possible. To qualify for an Earnest parent loan, you’ll need a minimum 650 credit score, $35,000 or higher annual income, and no bankruptcies or accounts in collections.

Deferred payments while the student is in school
9-month grace period
Not available in Nevada

Loan details

Rates (APR)	As low as 4.17%
Loan amounts	$1,000 – 100% of certified costs
Repayment terms	5, 7, 10, 12, or 15 years

Eligibility requirements

Must be the age of majority in state of residence
U.S. citizen, permanent resident, DACA recipient, or asylee.
Minimum of three-year credit history
Student must enroll at least half-time
Only bachelor’s degree programs and higher
Student must attend a Title IV-qualified, not-for-profit, 4-year institution

SoFi

Best for Member Benefits

4.7 _/5

LendEDU Rating

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Why it’s one of the best

SoFi parent loans are built for borrowers from the bottom up. You won’t pay origination or late fees when borrowing from SoFi. Plus, take advantage of exclusive members-only benefits, including financial planning and rate discounts if you take out another SoFi loan.

SoFi doesn’t defer payments, so be prepared for immediate repayment. You’re only required to pay interest while your child is in school. Plus, you can use the points you earn through the SoFi Member Rewards Program to pay down your loan faster.

No fees
Multiple rate discount options
Earn points with SoFi Member Rewards

Loan details

Fixed Rates (APR)	6.07% – 15.86%
Loan amounts	$1,000 – 100% of certified costs
Repayment terms	5, 7, 10, or 15 years

Eligibility requirements

U.S. citizen, permanent resident, or non-permanent resident alien
Only bachelor’s degree programs and higher
Student must enroll at least half-time
Student must attend an eligible institution

What is a parent student loan?

A parent student loan is a loan taken out by parents or other supportive adults, like grandparents or guardians, to help cover a student’s education expenses. Unlike student loans in the student’s name, parent loans place full responsibility for repayment on the adult borrower, giving the student a debt-free start after graduation.

Here’s how parent loans and student loans compare:

Eligibility: Parent loans are available to parents and supportive adults, while only students can apply for student loans directly.
Credit requirements: Parent loans generally require a credit check, whether federal Parent PLUS Loans or private options. In contrast, federal student loans don’t require a credit check, making them more accessible for students with limited credit history.
Loan limits: Parent loans often offer higher borrowing limits—up to the full cost of attendance (COA) minus other aid—while student loans have annual and lifetime caps.
Interest rates: Federal Parent PLUS Loans have a fixed rate, while private parent loans may offer either fixed or variable rates, sometimes at lower rates for those with excellent credit. Federal student loans generally have fixed rates, but private student loans can vary.
Repayment responsibility: With parent loans, the adult borrower is responsible for repayment, though the student can help voluntarily. Student loans, on the other hand, are solely the student’s responsibility after graduation.
Repayment options: Federal Parent PLUS Loans offer income-driven repayment (through consolidation) and deferment, along with eligibility for PSLF. Private parent loans may have limited repayment flexibility. Federal student loans also come with income-driven repayment options, deferment, and certain forgiveness options.
Fees: Federal Parent PLUS Loans charge a 4.228% origination fee, while private parent loans may have no fees. For student loans, fees vary by loan type for federal options, and private student loans have varied fee structures.
In-school deferment: Federal parent loans offer deferment until after the student graduates or leaves school, plus a six-month grace period. Many private parent loans also allow deferment, though some may require at least interest-only payments during this time.

These differences make parent loans a practical choice for those looking to support a student’s education without adding to their debt load directly. For families needing flexibility, the federal Parent PLUS Loan offers several protections, while private options can provide lower rates and fees for those with strong credit.

Best private student loans

Pros and cons of parent student loans for college

Deciding whether to apply for federal or private parent student loans isn’t always a no-brainer. Here are some pros and cons to help decide:

Pros and cons of Parent PLUS Loans

Pros

Not income-dependent

Income level doesn’t impact loan approval amounts.
Fixed rates

Fixed rates mean consistent monthly payments.
Deferred payments

Delay payment until your student graduates, drops below half-time, or withdraws.
Payment plan

Enroll in an income-contingent repayment plan to suit your budget.
100% costs covered

Borrow as much as your student needs, minus financial aid.
Long terms

Federal loans may allow borrowers up to 25 years to repay.
Potential loan forgiveness

“Forgiven” aren’t required to pay back the loan balance.

Cons

Need-based

You’ll need to prove financial need.
Fewer term options

There isn’t much flexibility for borrowers planning for fast repayment.
Credit history requirement

Parent borrowers with turbulent credit history, such as bankruptcies, may have difficulty getting approved.
No automatic deferment

Unless you request deferred payments, repayment automatically starts upon loan disbursement.
Loan fees

There’s currently a 4.228% loan fee in addition to interest.

Pros and cons of private parent student loans

Pros

Not need-based

Potential borrowers aren’t required to demonstrate financial need.
100% costs covered

Many private lenders offer 100% COA, minus financial aid.
Competitive rates

Starting fixed and variable interest rates are often lower than federal loans.
No fees

Many private lenders charge no loan origination, application, or hidden fees.
Wide range of potential borrowers

Stepparents, legal guardians, other relatives, and even family friends may also apply.

Cons

Income and credit requirements

If you’re approved with poor credit or low income, you might pay way more over the life of the loan.
Limited borrower assistance

Assistance, such as loan forgiveness and repayment plans, are scarce.
Variable rates

Even low variable rates can create unpredictable and potentially high monthly payments.

Steps to apply for a parent student loan

Taking out a parent student loan is a process best handled with forethought and patience.

The right parent loan for you starts with your creditworthiness. If you have poor credit, I will typically recommend the Parent PLUS Loan over a private lender. Even though there is a credit check, you will typically get more favorable options with the PLUS Loan. If you have great credit, a private student loan tends to be the better option due to lower rates and no origination fees.
Crystal Rau, CFP®

Give yourself time to explore your options, and follow these steps to ensure you’re getting the best loan for you and your family:

Compare rates. Research each private lender’s rates and compare them to the rate you’d get with a federal parent loan. Note the four or five lowest possible rates.
Prequalify. Check your personal rates with the lenders you prioritized in step one. Once you know what rates you’ll qualify for with each lender, it’s time to evaluate your potential loan terms.
Weigh your repayment obligations. Decide what monthly payment you can afford and whether in-school or deferred payments are better for your budget. While making payments right away can help save money, some parents might not be able to afford it immediately.
Consider standout features. You may find that your options are similar across lenders. If so, note what each lender offers that the others don’t. Of those features, which ones will make a substantial difference in your borrowing experience?

Tip

If you are unsure what type of parent loan to take out, check out our Parent PLUS Loan vs. private student loan guide to help you choose the best option.

Once you select a company to borrow from, gather all the necessary information to apply. This information may include:

Personal information: Driver’s license or other government-issued photo ID and Social Security number
Financial information: Pay stubs, tax returns, and 1099 statements
Education information: Your child’s school, any additional aid they’ll receive, and their COA

To help save time, gather this information before you start prequalifying with different lenders. That way, when you find a loan offer you like, you can jump right into the application without missing a beat.

How to repay student loans as a parent

Parents have various repayment options with the federal Parent PLUS Loan and private parent student loans. Your lender may let you defer payments while your child is in school, but that might not be the best option for your financial situation.

Here’s a quick look at the differences between in-school repayment and deferred to help you decide:

	In-school repayment	Deferred repayment
Payments begin …	30 – 45 days after loan is disbursed	6 – 9 months after student leaves school
Pay toward …	Interest only or interest + principal	Interest + principal
Interest still accrues?	Yes	Yes
Key advantage	Pay down loan faster	More affordable in the short term
Key disadvantage	May not be budget-friendly	Pay more in interest

Note that deferring payments on federal parent loans delays your eligibility for federal student loan forgiveness.

If you hope to take advantage of this, your loan servicer can help you find ways to keep your monthly payments at reasonable levels while allowing you to make progress toward forgiveness.

In addition to comparing the benefits and drawbacks of in-school and deferred payments, you’ll also want to consider:

The length of your repayment period
Whether you can afford to pay extra toward your principal
The potential impact of each repayment method on your future financial goals

After your child graduates, you may be able to refinance Parent PLUS Loans in their name. But this will only work if your child agrees and can qualify for a loan independently.

Refinancing won’t make sense in all situations, but it’s an option you and your child can explore together. Whether you and your child decide to refinance, you will have protected their health while funding their education—and that’s something to be proud of.

FAQ

Can I qualify for parent student loans with bad credit?

Yes, you can still qualify for parent student loans with bad credit. You’re more likely to get approved for a federal parent student loan as long as you don’t have previous loans with late payments or bankruptcies. But if you do, you may still be eligible if you meet other qualifiers.

With private parent student loans, your path may be more difficult. Many lenders choose to keep their credit requirements close to the vest, but they tend to take a holistic approach, where your income and other factors come into play. You may get approved at a higher rate.

Can parent student loans be deferred?

Yes, with federal and most private parent student loans, you can defer payments, typically up to several months after your student graduates.

You may defer a Parent PLUS Loan for six months after your student graduates or until s/he leaves the program or drops below half-time status. Typically, you may defer a private loan for six to nine months, but some lenders require you to at least pay the interest during attendance.

Can a parent student loan be transferred to the student?

No. Technically speaking, a federal Parent PLUS Loan cannot be transferred to a student. However, your student can refinance it by opening a private refinance student loan and using his/her new loan to pay off your current federal loan. You can also use this process to transfer a private parent student loan.

Are there any tax benefits for parent student loans?

Yes, you can deduct as much as $2,500 from your taxes for the interest you paid on any federal and private student loan, including parent student loans, as long as the loan was for you, a spouse, or a dependent.

How we picked the best parent student loans

LendEDU evaluates student loan lenders to help readers find the best student loans. Our latest analysis reviewed 725 data points from 25 lenders and financial institutions, with 29 data points collected from each. This information is gathered from company websites, online applications, public disclosures, customer reviews, and direct communication with company representatives.

These star ratings help us determine which companies are best for different situations. We don’t believe two companies can be the best for the same purpose, so we only show each best-for designation once.

Recap of the best parent student loans

Lender	Best for	LendEDU rating
Dept. of Education	Federal parent loans	Not rated
College Ave	Private parent loans	5/5
Earnest	Large loans	4.7/5
SoFi	Member benefits	4.7/5