Parent Plus Loans - News

If you have Parent PLUS loans, you must consolidate them no later than June 30, 2026 to maintain eligibility for all Income‑Driven Repayment (IDR) plans. If you miss this deadline, you will permanently lose access to IDR options.

Additionally, any new federal loans borrowed on or after July 2026 will also result in a permanent loss of IDR eligibility.

This creates a serious issue for many Parent PLUS borrowers who still have children in school. While they are allowed to continue borrowing for their dependents, any new borrowing after July 2026 will immediately forfeit all access to IDR, even if they were previously eligible.

This flaw in the OBBB Act could lead to widespread financial hardship, and likely cause a surge in defaults among Parent PLUS borrowers in the coming years.

The Department of Education has indicated that the consolidation process may take up to three months to complete. This effectively means that Parent PLUS borrowers who need to consolidate in order to keep access to IDR plans should aim to begin the process by early April, ensuring everything is finalized before the official June 30, 2026 deadline.

If you have already consolidated all of your Parent PLUS loans — whether through a single consolidation or a double consolidation — you are in the clear for now and should retain access to IDR under the current rules.

The Department of Education has stated that anyone who has ever held a Parent PLUS loan must make at least one payment under the ICR plan before switching to IBR. The good news is that this required ICR payment can be made anytime after July 2026 and up through mid‑2028, so borrowers have flexibility on timing.

The real deadline is tied to consolidation:

To keep access to IDR plans, Parent PLUS loans must be consolidated before July 2026. That is the part of the process with the firm cutoff date.

However, requiring borrowers who are already enrolled in IBR—and who have already consolidated their Parent PLUS loans—to temporarily move back to ICR just to switch back to IBR again creates unnecessary complications. This extra step would increase processing times, overload loan servicers with additional applications, and contribute to even more confusion in the student loan system.

It’s unclear why this requirement is being considered, but ideally it will be removed before it causes additional disruption for borrowers.

Will look into best practice by March or April if this rule is not repeal.