Best Parent Student Loans

With tuition and school fees continuing to climb, many parents want to do their part to keep their children from paying for their entire education out of pocket.

If your kids are heading to college, parent student loans can be used to cover those educational expenses. These loans are taken out in your name instead of your child’s and require good credit. Here are the best federal and private parent student loans.

Lender	Our rating
Dept. of Education	Not rated
College Ave	5/5
Earnest	4.7/5
SoFi	4.7/5

Federal Parent PLUS Loan

If your child has already met federal loan limits or you simply don’t want your child to have student loans in their name, you have the option of taking out a Parent PLUS Loan. Learn more about these loans in the table below:

Key information
Rates	Fixed at 8.05%
Origination fee	4.228%
Credit check?	☑️
Loan limits	100% of COA, less other financial aid
Terms	10 – 25 years
In-school repayment options	Partial, full, or deferred
Grace period	6 months after child leaves school

To be eligible for a Parent PLUS Loan, you must meet credit requirements, and your child must attend school at least half-time. If you have an adverse credit history—such as a foreclosure or bankruptcy discharge within the last five years—you may still qualify for federal parent loans in one of two ways:

1. Get an endorser who, much like a cosigner, will repay the loans if you can’t. Note that your endorser can’t be your child.
2. Appeal your credit decision and provide proof of extenuating circumstances.

If you opt for the latter, you’ll also need to complete PLUS Credit Counseling before you qualify for a Parent PLUS Loan. You can also see our student loans guide for parents with poor credit to get a more in-depth rundown of your options.

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 student loans for parents

Parents can also apply for private student loans. These loans are issued by private lenders and aren’t affiliated with any federal government education loan program. 

As such, private student loans for parents don’t offer the same protections or forgiveness options as federal PLUS Loans. Still, when you’ve exhausted your federal loan options, private student loans can help ease the tuition burden. We researched the best private student loans to determine which offer the best terms for parents.

Best overall – College Ave parent student loan

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LendEDU rating: 5 out of 5

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

College Ave offers different types of 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 spread out over five to 15 years, College Ave loans can work for almost every budget. But College Ave doesn’t provide a grace period. You’ll need to pay at least your monthly interest charges while your child is in school.

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Best for no fees – Earnest

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LendEDU rating: 4.7 out of 5

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

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 also 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.

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Best for member benefits – SoFi

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LendEDU rating: 4.7 out of 5

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

SoFi parent loans are built for borrowers from the bottom up. You won’t pay origination or late fees when borrowing from SoFi. Plus, you’ll enjoy exclusive members-only perks, 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. 

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What is a parent student loan?

A parent student loan is a loan that a parent or guardian can get to pay for education costs on behalf of an eligible student. Repayment of parent student loans is the responsibility of the borrower, not the student.

Students can agree to make payments toward parent loans, but they’re not required to do so. The amount you can borrow with a parent loan depends on whether you’re seeking federal or private funding, the cost of attendance (COA) at the student’s school, and other amounts of financial aid received.

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Best private student loans

Steps to take before you apply for a parent student loan

Taking out a parent student loan—or any loan, for that matter—is a process best handled with forethought and patience.

Our expert weighs in: Private parent loans vs. federal Parent PLUS Loans

Crystal Rau

CFP®

If somebody has poor credit, I will typically recommend the Parent PLUS Loan over a private lender. Even though there is a credit check, they will typically get more favorable options with the PLUS Loan. If somebody has great credit, a private student loan tends to be the better option due to lower rates and no origination fees. So it really starts with one’s creditworthiness.

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

1. 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.
2. 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.
3. 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.
4. Consider standout features. You may find that your options are similar across lenders. If so, make note of what each lender offers that the others don’t. Of those features, which ones will make a substantial difference in your borrowing experience? 

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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 which one may be best for you.

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Once you select a company to borrow from, you’ll need to 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.

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Types of student loans

How to repay student loans as a parent

Parents have a variety of 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?	☑️	☑️
Key advantage	Pay down loan faster	More affordable in the short term
Key disadvantage	May not be budget-friendly	Pay more in interest

Note, too, 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 to it and can qualify for a loan on their own. 

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.

Recap of the best parent student loans

Lender	Our rating
Dept. of Education	Not rated
College Ave	5/5
Earnest	4.7/5
SoFi	4.7/5