Refinancing your Parent’s loan is the best way to help them out. You can either refinance their current Parent PLUS loan, or you can get a new one. The process is easy and takes less than 10 minutes to complete.
Filling out the Refinance Application
Filling out the application is a crucial step to ensure you receive the best rate possible. Following the tips below will help you complete your refinance application:
- Be honest and accurate. Make sure that all of your information is correct and up-to-date, including contact information, employment status, monthly income, assets and liabilities. Misrepresenting any information could result in denial or increase the potential for fraud penalties.
- Don’t include unnecessary documents with your application package. You can upload essential documents such as tax returns & W-2 forms directly into the system.
Documents required for refinancing
When refinancing your Parent’s loan, you will need to provide us with the following documents:
- A copy of your parents’ most recent tax return.
- Proof of income.
- Proof of citizenship or residency in the U.S., if applicable (this can be a Social Security card).
- Proof of identity for all borrowers; this should include copies of driver’s licenses or passports for each borrower, as well as birth certificates for any children listed on the application who are under 18 years old.
How to Refinance your Parent PLUS Loans?
So, you want to refinance your Parent plus loans? That’s great! But before you start the process, it’s important to understand what refinancing is and how it works.
Refinancing your Parent’s PLUS loans means that you are transferring the balance of those loans into a new loan with a private lender. The goal of this is to lower your monthly payments by extending out their term with lower interest rates on top of better repayment options (such as variable or fixed). This can be beneficial if:
- Your parents have built up extra cash since they last took out their initial loan.
- You’ve been working full-time for over two years and want relief from high monthly payments.
Understanding the Parent PLUS loan refinance process
- The first step is to understand what a parent PLUS loan is. This type of loan is an extension of the federal student loans your parents take out in order to pay for your college costs, but they don’t have to be approved by you.
- Next, determine if refinancing your Parent’s loan will be helpful to them. If it helps them with their financial situation and they are able to pay off the loan early without penalty, then this may be a good option for them. However, if they need help making payments each month or can’t afford the monthly payments after refinancing their loan and it’s affecting their ability to live comfortably, refinancing may not be beneficial.
- Finally, contact several lenders who offer loans for parents so that you can compare rates and find one that best meets your and their needs!
SoFi experts state, “You could save hundreds or more and pay off your Parent PLUS loans faster.”
Refinancing your Parent’s loan is a simple task. You just need to follow some basic steps and then you can refinance it quickly. Refinancing a Parent Loan can help you save on interest rates, repay faster and even have access to more money.
