What to Do if Your Parent Plus Loan is Denied

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The high cost of college can be overwhelming for students and their parents — especially if you’re unable to qualify for a Parent PLUS Loan to help cover your child’s college expenses.

But even if your application for a Parent PLUS Loan is denied, you and your child aren’t out of options for this particular type of loan (or other ways to pay for college). In fact, your child may even be eligible for additional unsubsidized federal student loans.

Here’s what you need to know if you’ve been denied a Parent PLUS Loan:

Options after a Parent PLUS Loan is denied

If you were denied a Parent PLUS Loan because you have an adverse credit history, you can still qualify for a Parent PLUS Loan in two other ways:

  1. Get an endorser. An endorser is like a cosigner on a private loan. An endorser can’t have an adverse credit history and must also agree to repay the Parent PLUS Loan if you don’t. The endorser can’t be the student whose education you’re taking the loan for.
  2. Provide proof of extenuating circumstances. If you can prove to the U.S. Department of Education that the adverse credit history is either based on incorrect information or that there were extenuating circumstances relating to the adverse event, then you can potentially qualify for a Parent PLUS Loan.
Keep in mind: Offering documentation of the extenuating circumstances doesn’t guarantee that your loan will be approved. Additionally, both these options require you to complete credit counseling for Parent PLUS borrowers.

In addition to these approval avenues, here are some other ways to get the funding you need for your child’s education:

  • Improve your credit. Work toward making your delinquent accounts current before you apply for a loan for your child’s education.
  • Have your student apply for a private loan with a cosigner. Your child may be able to qualify for a relatively low-cost private loan if they apply with a cosigner with a robust credit history.
  • Have your student apply for additional unsubsidized federal loans. Students whose parents are denied for Parent PLUS Loans may be eligible for additional unsubsidized federal loans. In fact, students may be able to borrow more money than they normally would if their parent’s PLUS loan application is denied. However, with unsubsidized loans, the interest will accrue while the student is in school, unless they choose to make interest payments, so it’s prudent to only borrow what you need. You will need to contact the financial aid office at your child’s school for more information.

Check out: 5 Steps to Take If You Can’t Afford College

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Parent PLUS Loan requirements

With a Parent PLUS Loan, an eligible parent can borrow up to the cost of their child’s attendance, minus any other financial assistance the student receives. Eligibility requirements include:

  • You must be the biological or adoptive parent (or in some cases the stepparent) of a dependent student enrolled at least half-time in an undergraduate program.
  • You must meet the general eligibility requirements for federal student aid, which include being a U.S. citizen or eligible noncitizen and having financial need.
  • You must not have an adverse credit history.

While the Department of Education doesn’t have a specific credit score requirement for Parent PLUS borrowers, you can’t qualify for a loan if you have an adverse credit history. Specifically, you’re considered to have an adverse credit history if any of the following issues are on your credit report:

  • You’re delinquent by 90 days or more on an outstanding balance greater than $2,085 on one or more debts at the time of the credit check.
  • Your outstanding debts with a balance greater than $2,085 were placed in collection or charged off in the two years before the credit check.
  • In the five years before the credit check, you were subject to any of the following: default determination, discharge of debts in bankruptcy, foreclosure, repossession, tax lien, wage garnishment, write-off of a federal student aid debt
Good to know: If you have a low credit score but don’t meet any of the above criteria for an adverse credit history, then you may still be approved for a Parent PLUS Loan.

Read more: 2 Student Loan Options For Parents With Bad Credit

Compare private parent student loans to fill the gaps

If you need to take out private parent student loans to fill in the funding gaps for your child’s education, make sure you compare lenders to find the best option for your financial situation. Since each lender has its own eligibility requirements, loan amounts, interest rates, repayment terms, and fee schedule, the only way to know you’ve found the right loan is to compare as many as possible.

This kind of comparison is easy with Credible. The companies in the table below are Credible’s approved partner lenders. Whether you’re the borrower or cosigner, Credible makes it easy to compare rates from multiple private student loan providers without affecting your credit score.

Lender Fixed Rates From (APR) Variable Rates From (APR)

Credible Rating

Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.
3.15%+ 0.98%+
  • Fixed APR: 3.15%+
  • Variable APR: 0.98%+
  • Min. credit score: 540
  • Loan amount: $2,001 to $200,000
  • Loan terms (years): 5, 7, 10, 12, 15, 20
  • Repayment options: Full deferral, fixed/flat repayment, interest only, academic deferment, military deferment, forbearance, loans discharged upon death or disability
  • Fees: None
  • Discounts: 0.25% to 1.00% automatic payment discount, 1% cash back graduation reward
  • Eligibility: Must be a U.S. citizen or permanent resident or DACA student enrolled at least half-time in a degree-seeking program
  • Customer service: Email, phone
  • Soft credit check: Yes
  • Cosigner release: After 24 months
  • Loan servicer: Launch Servicing, LLC

Credible Rating

Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.
3.72%+1 1.86%+
  • Fixed APR: 3.72%+1
  • Variable APR: 1.86%+
  • Min. credit score: 720
  • Loan amount: $1,000 to $350,000
  • Loan terms (years): 5, 10, 15
  • Loan types: Any private or federal student loan
  • Repayment options: Full deferral, full monthly payment, interest only, immediate repayment, academic deferment, military deferment, forbearance, loans discharged upon death or disability
  • Fees: Late fee
  • Discounts: Autopay, loyalty
  • Eligibility: Available in all 50 states (international students can apply with a creditworthy U.S. citizen or permanent resident cosigner)
  • Customer service: Email, phone, chat
  • Soft credit check: Yes
  • Cosigner release: After 36 months
  • Loan servicer: Firstmark Services

Credible Rating

Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.
3.22%+2,3 0.94%+2,3
  • Fixed APR: 3.22%+2,3
  • Variable APR: 0.94%+2,3
  • Min. credit score: Does not disclose
  • Loan amount: $1,000 up to cost of attendance
  • Loan terms (years): 5, 8, 10, 15, 20
  • Repayment options: Full deferral, full monthly payment, fixed/flat repayment, interest only, immediate repayment, academic deferment, forbearance, loans discharged upon death or disability
  • Fees: Late fee
  • Discounts: Autopay
  • Eligibility: Must be a U.S. citizen or permanent resident and be making satisfactory academic progress.
  • Customer service: Email, phone
  • Soft credit check: Yes
  • Cosigner release: After 24 months
  • Loan servicer: College Ave Servicing LLC

Credible Rating

Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.
3.2%+ 2.0%+
  • Fixed APR: 3.2%+
  • Variable APR: 2.0%+
  • Min. credit score: Does not disclose
  • Loan amount: $1,000 to $99,999 annually ($180,000 aggregate limit)
  • Loan terms (years): 7, 10, 15
  • Repayment options: Full deferral, immediate repayment, interest-only repayment, flat/full repayment, academic deferment, military deferment, forbearance, loans discharged upon death or disability
  • Fees: None
  • Discounts: Autopay
  • Eligibility: Not available to residents of AZ, IA, or WI
  • Customer service: Phone, email
  • Soft credit check: Yes
  • Cosigner release: After 36 months
  • Loan servicer: American Education Services
  • Min. income: Does not disclose

Credible Rating

Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.
4.52%+7 3.37%+7
  • Fixed APR: 4.52%+7
  • Variable APR: 3.37%+7
  • Min. credit score: 750
  • Loan amount: $1,000 to $200,000
  • Loan terms (years): 7, 10, 15
  • Repayment options: Full deferral, full monthly payment, interest only, immediate repayment, academic deferment, loans discharged upon death or disability
  • Fees: Late fee
  • Discounts: Autopay
  • Eligibility: Must be a U.S. citizen or permanent resident and have a minimum income of $30,000.
  • Customer service: Email, phone
  • Soft credit check: Yes
  • Cosigner release: After 36 months
  • Loan servicer: Granite State Management & Resources (GSM&R)

Credible Rating

Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.
5.25%+8 2.92%+8
  • Fixed APR: 5.25%+8
  • Variable APR: 2.92%+8
  • Min. credit score: 670
  • Loan amount: $1,001 up to cost of attendance
  • Loan terms (years): 5, 10, 15
  • Repayment options: Full deferral, full monthly payment, interest only, immediate repayment, academic deferment, forbearance
  • Fees: Late fee
  • Discounts: Autopay, reward for on-time graduation
  • Eligibility: Must be an Indiana resident or a U.S. citizen attending an eligible Indiana school
  • Customer service: Email, phone, chat
  • Soft credit check: Yes
  • Cosigner release: After 48 months
  • Loan servicer: American Education Services

Credible Rating

Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.
4.89%+ N/A
  • Fixed APR: 4.89%+
  • Variable APR: N/A
  • Min. credit score: 670
  • Loan amount: $1,500 up to cost of attendance less aid
  • Loan terms (years): 10, 15
  • Repayment options: Full deferral, interest only, immediate repayment, academic deferral, forbearance
  • Fees: None
  • Discounts: None
  • Eligibility: Must be a U.S. citizen or permanent resident and be making satisfactory academic progress.
  • Customer service: Email, phone
  • Soft credit check: Yes
  • Cosigner release: After 48 months
  • Loan servicer: American Education Services (AES)

Credible Rating

Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.
3.75% – 13.72% APR9 2.0% – 12.35% APR9
  • Fixed APR: 3.75% – 13.72% APR9
  • Variable APR: 2.0% – 12.35% APR9
  • Min. credit score: Does not disclose
  • Loan amount: $1,000 up to cost of attendance
  • Loan terms (years): 10 to 15
  • Repayment options: Full deferral, fixed/flat repayment, interest only, academic deferment, forbearance, loans discharged upon death or disability
  • Fees: Late fee
  • Discounts: Autopay
  • Eligibility: Must be a U.S. citizen or permanent resident. Also available to non-U.S. citizen students (including DACA students) attending a school located in the U.S. who apply with a qualifying cosigner.
  • Customer service: Phone, chat
  • Soft credit check: Yes
  • Cosigner release: After 12 consecutive on-time payments
  • Loan servicer: Sallie Mae
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Lowest APRs reflect autopay, loyalty, and interest-only repayment discounts where available | 1Citizens Disclosures | 2,3College Ave Disclosures | 7EDvestinU Disclosures | 8INvestEd Disclosures | 9Sallie Mae Disclosures

Parent PLUS Loans vs. private parent loans and cosigned loans

You have a number of ways to fill in the funding gaps after your student has received their federal student aid package. With a Parent PLUS Loan or a private parent loan, you’ll be the borrower and are agreeing to repay the loan, while your child will be the borrower with a cosigned private student loan.

Understanding the potential fees, terms, rates, and conditions of each type of loan can help you and your student determine the best option for their educational funding. Here are some things you’ll need to keep in mind while comparing your options:

  Parent PLUS loans Private parent loans Cosigned loans
Fees Origination fee of 4.228% Varies by lender Varies by lender
Terms 10 years
(up to 25 or 30 years with other repayment plans or through consolidation)
5 to 15 years
(with Credible partner lenders)
5 to 20 years
(with Credible partner lenders)
Who’s responsible for monthly payment? Parent Parent Student (if student can’t make payments, cosigner is responsible)
Cosigner release offered? No Depends on the lender Depends on the lender
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About the author
Emily Guy Birken
Emily Guy Birken

Emily Guy Birken is a Credible authority on student loans and personal finance. Her work has been featured by Forbes, Kiplinger’s, Huffington Post, MSN Money, and The Washington Post online.

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