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Federal Direct Parent PLUS Loan

The Parent Loan for Undergraduate Students (PLUS) is an unsubsidized federal loan for the parents of dependent students. Learn more about the PLUS Loan and other federal aid programs on the U.S. Department of Education's Federal Student Aid website.

Beginning July 1, 2026, federal law (One Big Beautiful Bill Act) introduces major changes to the Parent PLUS Loan program, including new borrowing limits and repayment restrictions. These changes will impact both new Parent PLUS borrowers and some existing borrowers who take out additional loans after this date. Major changes and considerations include: 

  • New Parent PLUS borrowing will now be capped at $20,000 annually and $65,000 total
  • Some continuing students may qualify for temporary legacy borrowing limits
  • Families may need strategic borrowing plans to maintain access across four years
  • Repayment flexibility is significantly reduced
  • Borrowing after July 1, 2026 may eliminate income-driven repayment and PSLF eligibility

New Borrowing Limits

Beginning July 1, 2026, Parent PLUS Loans will be subject to new statutory borrowing limits:

  • Annual Limit: $20,000 per dependent student per year
  • Aggregate Limit: $65,000 total per dependent student

This will primarily impact brand new students who matriculate in Fall of 2026 or current students who have never used a Parent PLUS loan. If a parent borrows the maximum $20,000 annually, they will reach the $65,000 aggregate limit before a typical four-year program is complete. To ensure even eligibility across four years, families should consider borrowing smaller annual amounts (approximately $16,250 per year over four years).

Legacy Borrowing Provisions

Some families may continue borrowing under pre-July 1, 2026 limits if specific conditions are met. Students cannot opt out of legacy provisions if they qualify. 

A parent may qualify for legacy borrowing if:

  • The student was enrolled in the program on or before June 30, 2026
  • A Direct Unsubsidized, Subsidized, or Parent PLUS Loan was disbursed before July 1, 2026
  • The student remains enrolled in the same program of study at the same institution

Legacy eligibility lasts for three years or until the end of the student's undergraduate program, whichever comes first. 

Students remain eligible under legacy limits if they:

  • Change majors within the same degree type (e.g., BA → BA or BA → BS)

Students lose legacy eligibility if they:

  • Transfer to another institution
  • Change degree type (e.g., certificate → associate or associate → bachelor’s)
  • Withdraw or cease enrollment in the program

Repayment Plans

Beginning July 1, 2026, Parent PLUS Loans borrowed on or after this date will only be eligible for the new Tiered Standard Repayment Plan, which is not eligible for Public Service Loan Forgiveness (PSLF) and does not provide access to income-driven repayment plans.

Parents who take out a new Parent PLUS Loan on or after July 1, 2026 will therefore lose access to income-driven repayment options and PSLF, even if they previously had Parent PLUS Loans in repayment under other plans, because all Parent PLUS Loans must then be repaid under the new Tiered Standard Plan.

Parents who do not borrow additional Parent PLUS Loans after July 1, 2026 may continue repaying their existing loans under current repayment options, including the 10-year Standard, Extended, Graduated, or Income-Contingent Repayment (ICR) plans. However, ICR for Parent PLUS consolidation loans is expected to sunset on June 30, 2028, after which affected borrowers will transition to the Income-Based Repayment (IBR) plan.

General Parent PLUS Loan Information

  • Who Can Borrow: Parents (U.S. citizens or eligible noncitizens) of dependent students with satisfactory credit history.
  • Lender: Department of Education
  • Loan Amount: New borrowers may borrow $20,000 per year. Legacy borrowers may borrow up to the cost of attendance, minus any other aid the student has received.  
  • Interest Rate: 8.94% for 2025-26. The interest rates for 2026-2027 have not yet been announced. Interest is charged from the date of the first disbursement until the loan is paid in full.
  • Fees:  A 4.228% origination fee will be deducted from each loan disbursement for loans where the first disbursement is made on or after October 1, 2020 and before October 1, 2026. Use our online federal loan fee calculator to determine the impact of fees on your loan.
  • Repayment Terms: Repayment of the principal begins within 60 days of the final disbursement of funds for the academic year. A minimum payment of $600 per year is required, and the borrower has a maximum of 10 years to repay the loan.
  • Deferment: Parents may choose to defer payments on a PLUS Loan until six months after the student ceases to be enrolled at least half-time. Accruing interest can either be paid by the parent borrower monthly or quarterly, or capitalized quarterly (indicated on your PLUS Request and to be paid to the servicer). To assist with planning, the Department of Education provides very helpful budget and repayment calculators.
  • Application Instructions: Families need to complete a FAFSA (see Apply for Aid for more information) for the appropriate academic year. Parents should also complete the PLUS Loan Request as well as a Parent PLUS Master Promissory Note, found by logging onto www.studentaid.gov with your Federal Student Aid (FSA) ID. A credit check is required. Families should not apply for a PLUS Loan earlier than mid-June for an upcoming academic year since it requires a credit approval that is only valid for 180 days.