How Parents Can Love With Parent Plus Loan Consolidation
Parent plus loan consolidation
loans is the ultimate solution for parents who are knee-deep in
debt trying to get the children through college.
As parents in the United States would know, there
are Federal Parent PLUS Loans that enable them to pay for their
children's education. They can actually take out loans for each
child. Of course, in order to qualify, the child must be a dependent
of the parent who is taking out the loan and must enrolled in an
undergraduate university program.
The federal parent PLUS loans are guaranteed by
the federal government and they have are guaranteed to have low
interest rates. The main benefit of a federal PLUS loan is that
parents can borrow the total cost of their children's education,
including their tuition fees, board and lodging, laboratory expenses,
and travel expenses.
Checking for the eligibility of parent for a PLUS
Loan just depends on a modest checking on the parent's credit history;
the only red light sign on a PLUS loan is adverse credit history.
And when we say adverse credit history, we mean that a parent is
more than 90 days late on a debt payment within the past five years.
Parent PLUS Loans are definitely more advantageous
to parents because the interest rates were fixed at 8.5%, which
can be tax deductible. This type of loan also requires no collateral.
Parents who are above their heads in parent PLUS
loans can look forward to the benefits that parent PLUS loan consolidation
programs can offer. Their debts' accounts are simplified at the
very least since they only need to pay a single creditor. Of course,
if a parent took out federal loans and private loans, the said debts
cannot be mingled into one, and they would have to pay a consolidated
private loan and a consolidated federal loan.
In any case, with parent plus loan consolidations
parents can now take a breather in their debt payments. Not that
they do not anymore have to pay their debts, just that the debts
are now more manageable. Interest rates on parent plus loan consolidation
programs are calculated based on the weighted average of all previous
loans -making its interest rate lower.
In most cases, parents get an incentive, i.e.,
Interest rates are reduced, if they set up their payment system
on auto-debit. The prevailing interest rate on your parent plus
loan consolidation can be tax deductible. As of the moment, taxpayers
can get as much as $2,500 off on qualified education loans.
On top of these benefits, plus loan consolidation
programs can also improve credit scores. Outstanding debts, especially
if you default on them, can adversely affect your credit score.
With an improved credit score, children of loaning parents can qualify
for financial comforts beyond college, like having a place of their
own or having a brand new car.
The interest rates on parent plus loan consolidation
varies from lender to lender, but an interest rate would typically
include LIBOR plus a percentage rate on the total debt amount.