Follow-up question: I see that there are companies like SoFi, Laurel Road, and Common Bond that you can transfer the Parent Plus Direct loan to the student after graduation?

[HGrace]

Follow-up to my loan question: i see that there are companies that you can transfer Parent Plus Direct loans to your child’s name after college graduation, such as the ones I listed above. I read that one disadvantage is you lose the federal benefits such as adjusting the loan payment amounts to match your income, but we really can’t worry about that; we’d be in retirement and need to move the Parent Plus loan to her responsibility, with our names off of it.

Is anyone familiar with these type of companies? Pros/cons? Is it hard to refinance the loan in your child’s name once they graduate college? Our daughter is going into nursing, so she’d have a good income, and we want to move the loans over to her asap.

Thanks so much

 

[JanetC]

Those aren't federal PLUS loans. They're private loans.

Yes, it's hard to change the loans to just the student's name. The student will have to establish an income and credit history before the loan company would consider loaning to the student only.

The number of payments that must be made on a private student loan before the cosigner can apply to be released is listed on this table 

http://privatestudentloans.guru/private-student-loans.html

Another site to read up on student loans is nerdwallet.

[HGrace]

I know they’re private loans but it specifically says you can transfer the Parent Plus loan to the student after graduation from college, even with just a job offer that a job will start in six months. Is it hard for a new nurse out of school to take out a loan?

I’m asking because we don’t want to commit to it unless we can turn it over to her pretty quickly.

[JanetC]

I don't think there's way to know. She can't be solely responsible now. She might qualify for a loan after graduation. You can look at the current offers to guess, but the loan terms and/or the underwriting standards could change while she is in school.

[katilac]

Never, ever take out a loan or co-sign for one unless you can afford, and are willing to, to pay off that loan yourself. 

[Ravin]

On 4/26/2018 at 11:20 AM, HGrace said:

Follow-up to my loan question: i see that there are companies that you can transfer Parent Plus Direct loans to your child’s name after college graduation, such as the ones I listed above. I read that one disadvantage is you lose the federal benefits such as adjusting the loan payment amounts to match your income, but we really can’t worry about that; we’d be in retirement and need to move the Parent Plus loan to her responsibility, with our names off of it.

Is anyone familiar with these type of companies? Pros/cons? Is it hard to refinance the loan in your child’s name once they graduate college? Our daughter is going into nursing, so she’d have a good income, and we want to move the loans over to her asap.

Thanks so much

 

This sounds like a good way to screw over your child and ruin their credit. Taking federal loans private is not a good idea.

[Lang Syne Boardie]

Whoa...never mind, I read too quickly. I missed the amount, which is way too much for a parent plus loan, or for a college student who is going to have a middle class income.

[teachermom2834]

I am not anti-student loan debt. I think taking modest federal loans can be a good investment. Our kids are taking the federal loans and I would not be opposed to taking a small PLUS loan at some point to get them graduated if they had a shortfall late in their college career. Or taking a small personal loan through a bank to clear the final hurdles and get done if something unexpected came up at the end and they needed a little extra. All that to say I am not opposed to some education debt.

But what you are suggesting is really extreme. I understand wanting to let your dd have the college experience she desires. Really, I do. I cannot, however, see how this is at all a good idea even if you can transfer this all to your dd. Yes, nurses make good money. Nurses do not make enough money for an 80,000 debt to be easily absorbed. And what if through some unforseen circumstance she does not work as a nurse? What if she has a health crisis or hates nursing or has a baby or becomes disabled or any number of things? Plans change.

Nursing degrees do not need to cost that much.

I cannot imagine a child at age 25 looking down at that loan debt and being grateful to their parents for getting the PLUS loans to sign over to her. I think a child would have more resentment for her parents endorsing that position than for parents that said "no". 

Your posts come off with a tone that suggests you don't really think that debt will be a big deal for her. It will be. At best it will be a large burden. At worst a disaster. 

[Corraleno]

Add my vote to those who think saddling a young adult with $107,000 in debt ($27K student's Stafford loans + $80K transferred parent loans) is a terrible no good very bad idea. That is a HUGE amount of debt, which will financially handicap her for a decade or more — for the sake of a nursing degree she could easily get for much less. And there's no guarantee you can transfer the parent loans after she graduates, so you could get stuck with those yourself. I would work with her to find a more affordable solution that does not involve any debt beyond the maximum amount of Stafford loans ($27K).