Millions of parents take out student loans to help their children pay for college. Parent PLUS Loans and private parent loans can cover education costs while taking away the debt burden from the student.
But who counts as a parent for student loan purposes? Who can take out a loan depends on your relationship to the student, your marital status, the student’s enrollment status, and their year in school.
Here’s what you need to know about parent student loans:
Who Can Take Out Federal Parent PLUS Loans?
Federal Parent PLUS Loans are a popular option for parents of undergraduate students. Currently, parents can borrow up to 100% of the total cost of attendance for their child. But, the loans are solely in the parent borrower’s name, not the student’s, and they tend to have the highest interest rate of any federal student loan
[Important: For loans disbursed on or after July 1, 2026, new annual and aggregate limits will apply to Parent PLUS Loans.]
Parent PLUS Loan Eligibility Requirements
To take out a federal Parent PLUS Loan, you must meet the following eligibility requirements:
- Relationship to student: Only biological or adoptive parents of a dependent undergraduate student are eligible for Parent PLUS Loans. However, there are some cases where a stepparent may be eligible.
- Student status: Students must be dependent undergraduate students enrolled at least half-time at a qualifying school.
- Citizenship: Parent borrowers must be U.S. citizens or eligible noncitizens.
- Credit: Unlike other federal student loans, Parent PLUS Loan applicants must undergo a credit check. If you have an adverse credit history, such as having a recent foreclosure on your credit report, you may need to add an endorser or guarantor to your application and complete credit counseling.
- Loan status: If you have other federal loans in your name, none of the loans can be in default. If you’re behind on your payments, you’re ineligible for additional loans, including Parent PLUS Loans.
Note, only adoptive or biological parents are eligible for Parent PLUS Loans. Grandparents, aunts, uncles, or siblings are not eligible (even if they are the legal guardians of the student) unless they have completed the adoption process.
FAQs About Parent PLUS Loans
Can a grandparent take out Parent PLUS Loans?
No, grandparents are not eligible for federal Parent PLUS Loans. The only exception is if the grandparent legally adopted the student.
Grandparents can qualify for private parent loans, as long as the student is a dependent student living with the grandparent.
Can divorced parents each take out a Parent PLUS Loan?
Yes, both the custodial parent and non-custodial parent can apply for Parent PLUS Loans. However, the borrower who takes out the loan is responsible for its repayment, regardless of any divorce decree.
Can parents of graduate students take out Parent PLUS Loans?
No, Parent PLUS Loans are only available to parents of undergraduate students. If you’re a parent of a student enrolling in graduate school, you may need to take out a private parent loan instead.
Who Can Take Out Private Parent Loans?
Private parent loans come from banks, credit unions, or online lenders. Specific borrowing limits, rates, and repayment terms vary by lender, but you can generally borrow up to the total cost of attendance. And, unlike Parent PLUS Loans, you can use private parent loans to help a student pay for their master’s or doctoral programs.
With private student loans, the eligibility requirements for parent loans are quite different from the requirements for federal Parent PLUS Loans. Each lender sets its own criteria, but generally, more people can qualify for parent loans than just the biological or adoptive parent.
Private Parent Loan Eligibility Requirements
If you need to take out a private parent loan, you’ll have to meet these requirements for an ELFI parent student loan:
- Relationship to student: Grandparents, aunts, uncles, cousins, siblings, or legal guardians can take out a parent loan if they meet the following criteria:
- The dependent student shared a home with the borrower for at least half of tax year
- The dependent student is younger than the borrower and between the ages of 18 and 24
- The dependent student hasn’t provided more than half of their own support during the calendar year
- The dependent student is a U.S. citizen or eligible noncitizen
- Student status: The student must be enrolled in a qualifying undergraduate or graduate program.
- Citizenship: Borrowers must be U.S. citizens or eligible noncitizens.
- Credit: ELFI requires a credit score of 680 or better.
- Income: You must earn at least $35,000 in income.
Planning for College
Parent student loans can be an important resource as you plan ahead for your child’s education costs. Parent PLUS Loans have historically been a popular financing option. But, with the latest changes to the federal student loan program, new caps will apply to these loans, and families may need to consider other options.
Private parent loans can help cover your remaining expenses (without your child having to shoulder the debt). And, with ELFI’s prequalification tool, you can view your loan options and potential rates without affecting your credit score.
