March 15, 2021
If you’ve read your college financial aid award letter and still have expenses that aren’t covered by scholarships, grants or work-study programs, you may have reached the conclusion that you will need student loans to attend college. The decision, however, doesn’t end there, as there are multiple choices to choose from.
If you determine you need to borrow to pay for college, we recommend maxing out the federal Direct Student loans before considering other options. However, those Federal Direct Loans have loan limits that don’t always cover the Cost of Attendance. That might still leave unmet need that you or your family will need to finance. There are options!
One such option is a parent loan. Basically a parent loan, whether made by a private lender or the Federal Government (Federal Parent PLUS Loan), is a loan that a parent takes out, in their name, to finance the education of their child or dependent. The loan is not in the name of the child/student. It can be a valuable tool if you are experiencing difficulties covering the cost of education, and have a parent willing to foot the bill. It is, generally, used by parents who are concerned with their child having a large amount of debt at graduation. But it is important that students and parents fully understand what it means to take out a parent loan before you go down that road. Here are some things to consider:
If you decide a parent loan is the right option for you, you will have to decide what parent loan to use. There is a Federal Direct PLUS Loan, made by the federal government, as well as parent loans offered by private lenders, such as Brazos. You are encouraged to shop around and compare the rates and terms of private parent loans with the Federal Direct PLUS Loans, and compare the rates and terms of all private lenders to find the best product for your needs.
Brazos provides competitive private parent loan options that we’d love for you to compare to other lenders or Direct Parent PLUS Loan rates. See our full comparison of the Brazos Student loan and the Federal Direct Parent Loan.
Brazos is part of a group of Texas nonprofit companies dedicated to college affordability. In fact, we’re one of the best kept secrets in Texas! We’ve been helping students and parents finance their college education since 1975, and our companies together are the largest nonprofit student loan group in the country! Helping make college affordable has been our mission for over 40 years!