There are two main ways to get a PLUS parent loan forgiveness: through the public service loan forgiveness program and through the income-tested repayment plan.
Public service loan forgiveness involves a lot of paperwork, but it is the best option if you qualify. It takes a long time to cancel the refund based on income. Follow the standard ten-year plan for repay parent PLUS loans if you can afford it. It’s faster and will likely cost less overall.
If you want to request the cancellation of the PLUS parent loan, here’s how.
How to get Parental Forgiveness PLUS for Public Service Loan
Public service loan remission is available to all Federal Student Loan borrowers, including PLUS Parent Loan Holders, who make 120 qualifying payments while working full-time in a government position, or for a qualifying non-profit employer.
Only payments made on standard and income-based repayment plans are eligible for the PSLF. Since the standard plan repays the loan in 120 installments, parent PLUS borrowers seeking the PSLF should sign up for the income-based repayment plan (see below for how to do this).
You must complete a PSLF employment certificate form annually or whenever you change employer. Once all eligible loan payments are complete, you can submit a application. Once approved, the remainder of your PLUS parent loans will be tax exempt.
How to get loan forgiveness with income-based repayment
Reimbursement based on income, or ICR, is the only income-based repayment plan available for PLUS parent borrowers. This is the best option for Parent PLUS borrowers who cannot afford their long term payments.
ICR caps payments at 20% of your discretionary income or the amount of your fixed monthly payments over a 12-year loan term, whichever is lower. The ICR also extends the term of your loan from 10 years to 25 years.
To enroll, you must consolidate PLUS Parent Loans into a Federal Direct Consolidation Loan, then contact your loan officer to obtain an ICR plan. You have to recertify your financial information annually, which can affect your monthly payments.
After 25 years of repayment, any remaining balance is forfeited. But this amount is taxable income, which is added to your total bill. Use the government Loan simulator to calculate ICR payments and how much rebate you might receive; it may cost less to stick to the standard plan if you can afford the payments.
Other Ways Your Parent PLUS Loans Can Be Paid Up
There are a few other circumstances that could cause your parent PLUS loans to unload:
You die or the child you borrowed for dies.
You become totally and permanently disabled.
Your loan is discharged in the event of bankruptcy.
The student you borrowed from was unable to complete a degree because the school closed.
The school falsely certified your eligibility to receive the loan.
Identity theft cases in which your loan eligibility has been falsely certified.
The student you borrowed for withdrew from school, but the school failed to repay your loan money that it was legally required to repay.