Parent Plus Loans
Terry,
So I heard your segment this past Wednesday on Parent Plus loans. I almost took your advice and consolidated them as instructed on your website. This would have totally screwed me over. BIG TIME!!!
I heard that voice in my head to call student aid.gov to see if this was a good idea. Eventually they transferred me to my provider Mohela and the woman on the phone immediately said I was too late to consolidate my PPLs by July 1 and that had I done that my
personal student loans would have lost all their IDR benefits, which is a substantial lower payment, based on my income, due to the new rules July 1.
The main benefit of loans being dropped after the 20-25 year mark.
I was like a second away from pressing the consolidation button on my PPLs. This would have been devastating.
I guess what I’m trying to say is are you aware how long it takes for the PPL consolidation to go through?? They told me yesterday it wouldn’t hit by July 1st and that ALL MY LOANS would no longer be allowed for IDR benefits … they would be subject to the new guidelines
I’m just seeing if you’ve heard of this and trying to find answers.
Thank you for your time,
David C
My daughter and I are surviving but will not be able to pay under the new rules. Very scary time right now. She did advise us there are ways to delay payments up to 9 years, but interest accrues and after that there are no IDR benefits at that time, unless a new administration does something else ???
She mentioned a lot of people she helps are going to be in trouble with these new guidelines. NOT GOOD as we are trying but haven’t been able to get a well off paying job unfortunately.
Terry Says
First of all, there was no reason to contact your loan servicer — who has a vested interest in collecting high payments from you!
This online loan consolidation I wrote about is done at StudentAid.gov, only, and is facilitated by
Aidvantage, which processes all consolidations. It has nothing to do with your current loan servicer, or your other non-PLUS loans.
This advice was about consolidating Parent PLUS loans ONLY! When following instructions in the column, just click on the ParentPLUS loans as the one you want to consolidate.
If you have other student loans (your own) they will not be consolidated, and not impacted by any action you take on your own PLUS loans.
TIMING: if you consolidate online, it SHOULD get done within two weeks.
If you don’t consolidate, your PLUS loan payments will jump dramatically on July 1, as the standard 10-year repayment schedule goes into effect.
IF your consolidation has been accomplished, then your payments won’t jump.
And if there’s a crunch, and you start the consolidation now, and it doesn’t get done in time — you’re no worse off than if you hadn’t tried — AND, your loan payments will still jump.
