Affordable PLUS Repayment Options for Parents Act of 2025
Affordable PLUS Repayment Options for Parents Act of 2025 would change who can use income-driven repayment options for certain federal loans. Specifically, it would allow borrowers of Federal Direct PLUS loans made on behalf of dependent students (and loans under section 428B used for the same purpose, including corresponding Consolidation Loans) to repay those loans under an Income-Contingent Repayment (ICR) plan or an Income-Based Repayment (IBR) plan. The bill removes current limitations that barred PLUS loan borrowers from these income-driven programs and clarifies that PLUS-derived loans can qualify for ICR/IBR, including loans that were used to discharge PLUS debt through consolidation. The changes would take effect upon enactment and apply to borrowers who, on or after that date, have an outstanding PLUS (or 428B) balance and are repaying under ICR or IBR or would switch to these plans. In short, the bill expands access to income-driven repayment for parents who took PLUS loans for dependent students, potentially lowering monthly payments and providing long-term forgiveness options similar to other federal student loans.
Key Points
- 1The bill expands eligibility to repay Federal Direct PLUS loans made for dependent students (and 428B loans used for that purpose, including Consolidation Loans discharging such debt) under income-driven repayment plans (ICR and IBR).
- 2It explicitly removes the current prohibition that prevents PLUS borrowers from being eligible for ICR.
- 3It clarifies and broadens the availability of IBR to PLUS-related loans and consolidations used to discharge PLUS debt.
- 4It redefines “partial financial hardship” for IBR to align with an income-based standard based on discretionary income (adjusted gross income minus 150% of the poverty line, with a 15% threshold for required payments).
- 5The act takes effect on enactment and applies to borrowers with an outstanding PLUS (or 428B) balance on or after enactment who are repaying under ICR or IBR or would be eligible to do so.