If you’re parents are having trouble making payments on their Direct PLUS Loan, they should contact Federal Student Loan Servicing as soon as possible. They will help your parents choose the best course of action to take. Some options include:
- Change repayment plans.
- Apply for a deferment, if qualified. (see Student Loan Deferment and Cancellation Summaries page)
- Request a forbearance, if they don’t meet the eligibility requirements for a deferment.
- Refinance the debt through loan consolidation.
If your parents stop making payments and don’t get a deferment or forbearance, their loan account could become delinquent and then go into default, which has serious consequences.
If your parents default on their PLUS Loan:
- The entire unpaid balance on the loan could become due immediately.
- They could be sued, have their federal and state tax refunds seized, and their wages garnished to collect the unpaid balance.
- They would have to pay collection fees, court costs and attorney fees.
- The default will be reported to national consumer reporting agencies resulting in a damaged credit rating.
