Heather - I heard you speak at the Allstate Foundation event in Chicago and I have been carrying around your materials ever since.  I took out several Parent Plus Loans to pay for my daughter’s college.  I have worked non-profit for the past 20 years.  Can I apply any of that work to these loans? 

Also, is there a cost to consult you?

Many thanks.

Hi, Carol!  Thanks for your service!  PSLF is earned by making the right kind of payments, on the right kind of loan, while in the right kind of job.  So maybe or maybe not will some of the nonprofit work qualify.

Parent PLUS loans are technically eligible for PSLF, but a borrower can NOT choose IBR or ICR for a Parent PLUS loan, nor can they choose IBR for a consolidation loan that includes a parent PLUS loan, BUT they can choose ICR for a consolidation loan that includes a parent PLUS loan.  So, typically it will be the case that a parent borrower can only start making payments that count toward forgiveness after consolidating and choosing ICR.

Thanks

I researched it for ourselves a while back and, while we await Heather, it appears from my own research that my wife’s income would have to be included if we consolidated.

100k and 0 income. 

Has he consulted a bankruptcy attorney?  I know it can’t normally be set aside in bankruptcy but our attorney helped us see what is really a problem and what isn’t.  What really helped us was to see what could really happen in the worst case scenario where I would basically tell them to pound sand, I’m not paying, put me in default and do your worst to me. 

Some of the questions that came up for us, and I guess Heather would ask the same and more, are . . .

How old is your father?
How’s his health?
Does he expect to have income later?
Is he the only one to sign for these PLUS loans?
Does he think he’ll ever need to borrow money again?
What assets are there?
Who is the actual owner?
Is there any debt on the assets, such as a mortgage or auto loan?
What is the wife’s income?  It could be that consolidating and going ICR means a a real small or no payment, anyway.
Has he thought about going to or back to college at least half time?
Has he thought about deferring for a while longer?
Who actually went to school on that $100k?

Thanks Mere Nick!  Indeed a borrower cannot separate his income from his spouse for ICR payment calculation.  And yes, there are all sorts of potential angles for dealing with this debt.  If you want to look for a consumer lawyer in your area, I recommend the National Association of Consumer Advocates at http://naca.net

Please see second page in this doc item (i).  It states this “(i) Adjusted gross income (AGI) means the borrower’s adjusted gross income as reported to the
Internal Revenue Service. For a married borrower filing jointly, AGI includes both the borrower’s and
spouse’s income. For a married borrower filing separately, AGI includes only the borrower’s income.”

Has this changed recently?  Also on the NeltNet ICR calculator on their website it seems that repaying under ICR would not require spousal income in the calculation if married and filing separately.

Thanks

Left the link out

http://c.ymcdn.com/sites/www.ncher.us/resource/collection/2C0E5EC8-C31A-4DC2-B736-AA6D58D8C351/1-ICR_Changes_Contextual_CONSENSUS_FINAL_03302012.pdf