How To Cut Your Parent Plus Loan Payment in Half
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- Опубліковано 13 жов 2024
- Christie discusses method to reduce your Parent Plus Loan payment in half.
𝗙𝗼𝗿 𝗮 One-on-one 𝗖𝗼𝗻𝘀𝘂𝗹𝘁𝗮𝘁𝗶𝗼𝗻:
𝗖𝗮𝗹𝗹: (𝟴𝟭𝟯) 𝟮𝟱𝟴-𝟮𝟴𝟬𝟴 or
Email: info@christiearkovich.com
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Our two attorneys, Christie Arkovich and Barbara Leon, help to reduce student loan debt, file bankruptcy, avoid garnishment and foreclosure and other problems that too much debt can create.
Barbara Leon is a Florida licensed attorney for nearly 20 years in the areas of bankruptcy, foreclosure and student loans. Her practice and experience is well diversified, having gained experience through an internship with the U.S. Attorney’s office, a clerkship with a Federal Magistrate Judge, and both creditor and debtor private practice. This insight helps her to see all sides and find a solution quickly that works for everyone.
As founder of the firm, Christie Arkovich has practiced law for over 25 years. She is a frequent speaker at various consumer-oriented continuing legal education seminars for other attorneys before the American Bankruptcy Institute, the National Association of Consumer Advocates and the Tampa Bay Bankruptcy Bar Association. The firm maintains an AV Preeminent rating and enjoys excellent client reviews and we welcome you to see what we can do for you!
Our channel Student Loan Sidebar is a continuation of a quarterly column that we write for our local bankruptcy attorney bar organization helping people get a handle on their student loan debt. Whenever possible, Christie shares her knowledge about student loans gained working as trial counsel for Sallie Mae, ECMC, and other student loan servicers or guarantors, and her current law practice of over 25 years.
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𝗖𝗮𝗹𝗹: (𝟴𝟭𝟯) 𝟮𝟱𝟴-𝟮𝟴𝟬𝟴 or
Email: info@christiearkovich.com
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I have 3 Parent plus loans. What is the process for 3? So glad to watch your helpful video. Thank you!
I have 3 too. I think I'm going to consolidate 2 then consolidate that one with the other one .
Our process has changed a bit. Since Aidvantage is doing all consolidations now for all federal loan servicers, we do half with Aidvantage and once that's done in 45 days, we do the other half with Aidvantage. All by paper applications as the online system is halted now. Then when the second half is done, we recombine all in a final consolidation paper app with Aidvantage. The reason we do half at a time, is so that Aidvantage doesn't put them altogether. I don't know of any way to separate them if that accidently or purposely happens so we want to avoid the possibility. We like Nelent, but I don't believe they are processing any consolidations now and we don't want to wait.
I have one Parent Plus Loan- do I follow the same procedure you explained for five loans but with just one?
Hi Christie, If a parent PLUS loan borrower does and double consolidation and then selects REPAYE as their payment plan, will they be able to get their consolidation loan discharged after 20 years of eligible payments? The reason I ask is because the law, 34 CFR § 685.209(c)(5)(ii)(A), says "A borrower whose loans being repaid under the REPAYE plan include only loans the borrower received as an undergraduate student may qualify for forgiveness after 20 years". My concern is that the consolidation loan being repaid under the REPAYE plan is only for loans the . The parent borrower was not the undergraduate student who received the loans; It was the parent's son or daughter. Thus, ED might say the borrower (i.e. the parent) is not eligible for loan forgiveness after 20 years. What is your opinion on this issue.
Christie, I'm new & late to this Direct Parent Plus three consolidation process. Is it now too late to start & complete this two paper application & one online application consolidation process before the current deadline for non-ICR repayment? I have multiple loans for my son that go into repayment starting this month of June 2024..
So, as I watch this again on Oct 30, 2023, there was put into place an “indicator” on Parent Plus Loans, removing the loophole for any benefit from loan consolidation?
So, what is there to do at this point? Should I consolidate the 4 loans now or just leave them? Does it hurt to consolidate?
Even though the Indicator is there, we are hearing that you can still get into SAVE by double consolidating and then calling your servicer to be placed into SAVE at the end. Please contact us for a strategy session if questions on how to do. 813-258-2808 or info@christiearkovich.com.
im in a process of this double consolidation. i already consolidated my daughters last year with Aidavantage and found out the double consolidation this year. im waiting for the sons consolidated loan to be done and i have chosen the edFinancial. my question is. for the 3rd/last consolidation. which do you recommend for the servicer. I am not a public servant. and its always a struggle for me to choose between those servicers.
If I already consolidated my son’s PP loans with my own loans into one Direct loan, in one step, I didn’t get two direct consolidation loans, is there a way to undo this since it’s now one loan? Is there a way around this unfortunate error on my part.
There is supposed to be no way around it. But please reach out to us for a strategy session, I'd suggest an ombudsman review as your circumstances fit the July 2023 rule and comments perfectly. I'd try to get you into SAVE for all using that. SAVE is often hundreds or even thousands less per month than ICR. (813) 258-2808 or info@christiearkovich.com
Hi. I’ve read that some final consolidation requests are being rejected since a consolidation had already been processed. What steps can I take to avoid this? All loans for my two kids are currently with Nelnet.
Using more than one servicer helps get past this. Consol half with one servicer, the other half with another, then recombine with your favorite servicer. Mohela for public service. Only do one online, the other two on paper by mail. You can only do one consolidation online every six months. Hope this makes sense.
Hi. This is great information. I wish I saw this before I consolidated all of my parent plus loans with mohela😢 Is there anything else i can do? I make 63k a year and can't afford the $300 plus a month payment. I have my own student loan😢
Wait, so you have a pile of parent plus loans in one consolidation and then you have your own federal loan? That works!! Perhaps talk with us, but I’m thinking you can do another consolidation to combine them and get all into SAVE. Plus redating then all back. 813-258-2808 if you’d like to set a strategy session.
I have numerous Plus loans. I just consolidated part of them online, unfortunately. Would double consolidation work if I submitted a paper application for the rest of the Plus loans or am I out of luck. Also, do you have to request an IRC repayment plan?
We really should speak. I have a Sidebar that I'd like you to read, and we have some specific guidance for those with Parent Plus loans. (813) 258-2808. Info@christiearkovich. Want to discuss the July Rule, the new Indicator and our no harm no foul approach with the Ombudsman office.
We had 3 children go to college. I took out Parent Plus loans for 2 a”children and my wife you out PP loans for one child. Last week, I consolidated my loans and then went into my wife account and consolidated her PP loans. Can I then consolidate both as a double consolidation? What are the correct steps for the double consolidation? Thanks!!!!
I really would suggest a strategy session for you. You have to consolidate your loans in a particular order so that each of you complete a double consolidation of your Parent Plus loans. For this purpose, you would not do just one consolidation of all of your loans - that would put you into ICR, not SAVE. You have to take half and consolidate them, then consolidate the other half. Then the double is completed when you recombine them and then ask for SAVE. There's a particular way to do it using paper applications, and different servicers to prevent them from all being combined together too early.
I already did one online with Mohela because I’m a nurse, and my daughter went to nursing school, should I with drawl it? And do paper first or does it not matter which order? I only have one loan…
If you only have one loan, you cannot do a double consolidation. You have to have at least two to split them into two consolidations, and then recombine them.
If I have two loans I took out for my kids both have since graduated. It appears as now one payment for both loans. Do I just request one consolidation? How do I ask for a second consolidation for the same loan? Do I need to find a loan company or is a new one automatically assigned after each consolidation. I really need to get this Parent plus loan taken down to a regular federal loan to get the same advantages for lower monthly rates as the student loans. Is there website free assistance to help parents process this.
Please see our double consolidation video - this process is presently available but ED could close the window at any time. We use more than one servicer when doing a double consolidation. As you know the difference between ICR for Parent Plus loans and the new Repaye for regular federal loans is night and day. Our consult fee is $295 - I think it's well worth having a law firm like us review your situation and explain how to put your loans on the best path -- you can still do the consolidations yourself to save money! Info@christiearkovich.com. Studentaid.gov is the free gov't website with many FAQs also.
i heard they are closing that window within a year. is there still time for this? or is it too late.
how can I complete this process with my pp loans if I already consolidated? I just saw this video after consolidating! Please help!
I don't know of any way to undo a consolidation - there is a brief time to cancel it while it's being processed is all. If you had another Direct loan, it may be possible to combine it in another consolidation - then the PP loans would undergo a "double". It would need to be a degree seeking course for that other loan I've heard.
Great info I am seriously looking for options.
Glad to hear this has been helpful. If you'd like a 1 on 1 consult, just reach out to us at info@christiearkovich.com or call 813-258-2808.
My parents’ Parent Plus loan is on the graduates extended program will the amount never change until the loan is paid off or discharged? The payment is $447/month. We’ve been paying for 10 years (I am solely paying back for them now). I am trying to figure out if I should consolidate them or keep it how it is. I believe their payment on graduated extended is lower than what is would be if it was going based off my dads income right now but my parents are old and about to retire and only be on social security. Do I need to get them into ICR to lower the payments once on social security? And I am also looking into the double consolidation but I am worried that it will change the way the loan is? I hate thinking about this but… Would it still be discharged due to disability/death? Or would I (the student) have to take over the debt responsibility? If anyone can help I would really appreciate it! Hope this can help someone else too.
I did online with Mohela (before i knew of this) and just submitted a second consolidation with NelNet. Still waiting. I am also public service. What are my options for the final consolidation and still qualify for PSLF?
You have to have a loan that wasn't consolidated, or a separate consolidation of something to combine with Nelnet. If you consolidated all together with Mohela, you wouldn't have one to do another consolidation with Nelnet. Please call us for a strategy session on this or other options, and PSLF. (813) 258-2808.
What if my parent only has one Parent Plus Loan and two personal loans? Is this double consolidation still possible?
So Christie - in your case study you indicated the client had already paid off their own loans and had not paid off their parent plus loans but would still get forgiveness immediately for them. Since they already have paid off their own loans how are you able to get those repayment counts to go towards the parent plus loans that are still in existence? Did they recently pay off their own loans and can get some of the payments back for Covid payments - or is there another loophole I am unaware of? Thanks...
I'm not sure which case study w/o re-watching this, but I can say that any loan put into a prior or new consolidation will be used to determine the earliest repayment date. So if a loan was repaid through a prior consolidation it would count. If it was just repaid, it wouldn't help to reset the count.
• ED will conduct a one-time account adjustment to borrower accounts that will count time toward IDR forgiveness, including
o any time in repayment on earlier loans prior to consolidation of those loans into a consolidation loan.
When I get a chance, I'll go back and watch this video and comment further if I can.
Can I do a double consolidation now for my daughters loans that are due now, and than in february for my son when he graduates? I dont want to wait any longer and slip through the loophole!
What was your final decision? I have a son doing online for his master. his loans are deferred. I'm thinking to include his loans with the double consolidation to take advantage of the loophole..........
Yes, it appears that you can do a double consolidation now. Then if you have at least one loan for your son, you can combine them all yet again, or you can do a double with just his if you have two loans for your son. You have until July 1, 2025 to do this, so you should be within the window.
I did do a "short" video update where it appears that double consolidation is still working, despite the indicator that now shows any parent plus loans within a consolidation. It definitely won't work after July 1, 2025 per the newest Rule.
Isn't the forgiven balance after the 20 or 25 years considered as income and therefore taxed?
Depends, if forgiven before 12/31/25 it is not taxed. If after that date, Congress would have to change the law or the borrower would need to make arrangements to be insolvent for instance to avoid the federal taxable event.
My father has one (1) parent plus loan through Great Lakes and was recently redirected to Nelnet. Would he still be able to make these changes given his situation?
If one loan, he could at least consider consolidating to Direct so he would qualify for ICR. A strategy session may be best to see if he has other options (older folks often do), or could do something such as double consolidation to attempt to have the Parent Plus designation removed. No guarantees as the software or servicer could pick up on the Parent Plus aspect and still require ICR rather than the more beneficial SAVE. Under some situations though, ICR could be better, although more rare.
I have 2 parent plus loans for my daughter still in college with Nelnet. Can i due this process?
Yes, you can call your servicer and ask that the In School Deferment be removed. Then do the double consolidation procedure as noted, and then send in a paper IDR application and ask to be enrolled in SAVE.
Where do we find the paper application for consolidation? I have 4 parent plus loans, my husband is retired and im 63. ICR estimates our payment $800 -$900 which is very tough for us. I'm looking for a way to lower this given ill be retired and both in fixed income soon.
They just added a Parent Plus Consolidation Indicator to the National Report and I fear that the window for taking advantage of a double consolidation to remove that indicator has closed. Please see our blog this week: www.tampabankruptcylawyerblog.com/vote-of-no-confidence-for-double-consolidation/. It may be best to lower your AGI to lower your payments through Traditional IRAs etc., or talk to us about a TPD discharge since you are retired. That would be 100% discharge if eligible. Older clients have cognitive issues that prevent their normal full time work and may help for a TPD. I'll do a new TPD video soon, but there's one on here in the playlist already I believe.
Who can I consolidate my loans? With any available lender?
Is it possible to combine the two parent Plus loans my husband has with the one I have? Together, we have three prent plus loans, two under his name, one under my name.
A husband and wife can no longer join their loans. It was a really bad idea and ended in failure for many. Please watch our newest video out today about the new Parent Plus indicator and a possible way around it using the July 2023 rule. We'll know in a couple months whether the ombudsman will approve or reject SAVE using this process.
@@ArkovichLaw Thank you very much!
Hi- can the loophole work if you have 3 PPL's?
It should. You can consolidate just one with servicer A. Consolidate the other two with servicer B. Then do another consolidation of them all together with the servicer you'd like to remain with.
@@ArkovichLaw thank you!
Do I use the same process if I only have one Parent PLUS Loan
You can’t double consolidate with only one loan unfortunately.
Where do you find the addresses to mail these consolidation applications?
What are the different addresses for the different loan providers?
Here's the most common: www.tampabankruptcylawyerblog.com/mailing-addresses-for-consolidation-applications/
@@ArkovichLaw Thank you! I see that MOHELA, Aidvantage, and EdFinancial all use Aidvantage, does this affect the paper applications? If I were to send one to MOHELA, and the other application to aidvantage would they combine them? What would you recommend? I don't want them to combine the consolidations and ruin the chances for a double consolidation. Would greatly appreciate your feedback!
@@nassimagahrules I have this same question. I mailed two separate envelopes, one to EdFinancial and one to Aidvantage but they both have the exact same address? I wonder how this will effect everyone. I have seen this question also on other loophole videos and no one is answering this particular question. @ArkovichLaw this channel has great content, I wonder if you have had any confirmation from others that same address is ok to send to? Thanks Happy Friday!
I consolidate parent loan one time … so I need to do it again with one of my direct loan and then I would be able to select another IDR other then ICR
Basically yes. It's unknown for sure whether the Department will continue to allow this loophole to exist, but I believe the recent rule change offers sort of a safe harbor for those who do it now and an absolute point where they will stop allowing this July 1, 2025. See § 685.209(c)(5)(iii) which now provides that a Direct Consolidation loan made on or after July 1, 2025, that repaid a parent PLUS loan or repaid a consolidation loan that at any point paid off a parent PLUS loan is not eligible for any IDR plan except ICR.
Is there anything that can be done with Sallie Mae parent plus loans
Please watch our double consolidation videos. You can also set a strategy session with us to help with that. Our phone is 813-258-2808 or email to info@christiearkovich.com.
What is a good loan company to consolidate parent plus loans to be eligible for the $10000 loan forgiveness
Why would you need to consolidate?
What happens when you only have one servicer for your parents plus loan. Are you still able to utilize this method?
If one Parent Plus loan, no. If more than one loan, you could do two consolidations with separate servicers, and then re-combine them in a third consolidation if the disbursement date is different. This is called a double consolidation and while no guaranty, it may be used to avoid an ICR payment later. ICR can be several hundreds of dollars higher than Repaye.
so there's no guarantee meaning it sometimes doesn't work? is there any detrimental thing that could happen if it doesn't work? like would you be in a worse place
How do I know if I have more than one loan?
Check your loans on studentaid.gov. It will list federal loans. There is no database for private loans though - calls, letters or credit reports to find those.
How to reduce parent loan payments
See above -- do a double consolidation as noted - then apply for SAVE by a paper application. That will normally reduce a payment drastically b/c under SAVE the payment is 10% of discretionary income rather than 20% under ICR. Also the calculations are more favorable to exclude a higher portion of income (225% of poverty level rather than 100% under ICR). So your SAVE payment should be much less than half!
Are u representing Florida only or nationwide?
Nationwide for federal programs - otherwise for state court we're limited to Florida.