Parent PLUS Loan Rates for 2026: What Parents Need to Know

Parent PLUS Loan Rates Change
Brazos Staff

Last Updated: June 29, 2026

BIG Ideas:

  • Parent PLUS Loans are federal loans offered by the Department of Education that let parents of undergraduate students borrow to help pay for college.
  • The interest rate on Parent PLUS Loans disbursed between July 1, 2026 – June 30, 2027, is 9.07%, up from 8.94% the previous year. 
  • Parent PLUS Loans have some drawbacks, including higher interest rates, fees, limited repayment options, and upcoming borrowing limits for new loans first disbursed on or after July 1, 2026.

As a parent, one of your most important roles is supporting your child through life’s major milestones, including college. But with the rising cost of higher education, finding ways to help pay for school can be challenging.

The good news is that parents have options. One option is a Parent PLUS Loan, a federal loan offered through the Direct Loan program by the Department of Education that allows parents of dependent undergraduate students to borrow up to the cost of attendance minus other financial aid offered.

If you’re considering a Parent PLUS Loan, there are a few things to know. One of the most important factors to understand is the interest rate. Parent PLUS Loans typically carry higher interest rates than other federal loans, and rates are subject to annual adjustment based on the rates for the 10-year Treasury. In fact, the new rate for Parent PLUS Loans disbursed between July 1, 2026 – June 30, 2027, has been set to 9.07%.

Drawbacks of PLUS Loans

While Parent PLUS Loans can help bridge funding gaps, there are several factors to consider before borrowing.  

Loan Fees

In addition to interest charges, Parent PLUS Loans include a loan fee. For loans first disbursed on or after October 1, 2020, the fee is 4.228% of the loan amount. The fee is deducted from each loan disbursement, meaning you’ll receive less than the amount borrowed while still being responsible for repaying the full loan balance plus interest. 

Higher Debt Burden 

Beginning July 1, 2026, new Parent PLUS Loans are generally subject to a $20,000 annual borrowing limit and a $65,000 lifetime limit per student. While these limits may help some families avoid overborrowing, Parent PLUS Loans can still add significant debt to a parent’s financial obligations. 

Limited Exception to New Borrowing Limits 

Some families may qualify for an exception to the new borrowing limits. If a student remains enrolled in the same program at the same institution they attended as of June 30, 2026, and either the parent or student borrowed a federal Direct Loan for that program before July 1, 2026, the parent may continue borrowing under the previous rules for up to three additional academic years. 

Parents Are Responsible for Repayment 

Unlike some private loan arrangements, Parent PLUS Loans cannot be transferred to your child. Even if your student agrees to make payments after graduation, the legal responsibility for repaying the loan remains with you. 

Limited Repayment Options 

Parent PLUS Loans offer fewer repayment options than federal student loans borrowed by students. Beginning July 1, 2026, new Parent PLUS Loans are generally eligible only for the standard repayment plan and are no longer eligible for income-driven repayment plans. 

Public Service Loan Forgiveness Limitations 

Parents seeking Public Service Loan Forgiveness (PSLF) may qualify only after consolidating their Parent PLUS Loan into a Direct Consolidation Loan and repaying it under the Income-Contingent Repayment (ICR) plan, if eligible. Additionally, only payments made after consolidation count toward PSLF eligibility, and qualifying employment must be based on the parent’s employer – not the students. 

Alternatives to PLUS Loans

Before applying for a Parent PLUS Loan, make sure you’ve maximized all available financial aid opportunities.

Your student should complete the FAFSA and apply for scholarships and grants, which can help reduce college costs without creating repayment obligations.

After federal aid has been exhausted, families may also consider private student loans. Private student loans are credit- and income-based loans offered by banks, credit unions, and non-profits like Brazos.

With a private student loan, you can borrow up to the cost of attendance minus financial aid to help cover college-related expenses such as tuition, room and board, fees, books, and supplies. Depending on your credit profile, a private loan may offer a lower interest rate than a Parent PLUS Loan. Learn more about private loans vs. federal loans.

Brazos is Here to Help You Pay for College

For more than 40 years, Brazos Higher Education has helped make higher education more affordable. As a Texas non-profit, we offer competitive rates and no fees to help families finance college costs. 

Whether you’re comparing Parent PLUS Loans and private student loans or exploring your financing options, we’re here to help. Contact us today to learn more.