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How to Lower Lifetime Parent PLUS Loan Interest

Kathryn Morstad

Parent PLUS Loans are a great way to provide supplemental student financing after the limits are reached on traditional federal student loans. Many parents have used this option as a way to support their child in their educational goals by bridging the shortfall between scholarships, grants, federal student loans, and the full cost of their education.

Once the child graduates, parents often feel stuck with and hindered by their debt. Makes sense since Parent PLUS Loans are more expensive than other federal student loans. They have higher interest rates and higher loan fees that add up over time.  Collectively, borrowers owe $89 billion in Parent PLUS Loans not counting loans from private lenders.

If you feel like your future financial goals are being hurt by Parent PLUS Loan debt and interest costs, here are some solutions that will give you flexibility.

Why does getting a lower Parent PLUS Loan rate matter?

Set by Congress each year, federal student loan interest rates and origination fees are non-negotiable, and a higher credit score will not buy you a lower interest rate.

Parent PLUS Loans are more expensive than federal direct student loans.  For example, the interest rate was 7.08% for the academic year 2019-2020, while the origination fee was 4.236%.  Looking back over the last eight academic seasons, the average rate was 6.71%.

Once a child graduates and embarks on their new career, parents who have accumulated Parent PLUS Loan debt often begin to look at how they can improve their repayment terms to focus on building retirement income, financing a mortgage, or creating education opportunities costs for their other children.

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How to decrease your Parent PLUS Loan interest

If you are at a place in your life where you are looking for solutions to debt reduction, Parent PLUS Loans can be refinanced without penalties and offer a variety of options that can be tailored to your needs and financial goals.  And unlike federal loans, working with private lenders means that your hard-earned financial stewardship can be rewarded.

Significantly better rates may be available for people that have an overall strong credit history, solid income, and a good debt-to-income ratio.  Having each of those components, it may be worth your time to pursue a refinanced loan with more appealing interest costs and repayment terms — you have earned it.

Student loan refinancing and its benefits for parents

So let’s get into the specifics — what can be gained by refinancing your Parent PLUS Loans into one manageable program.  Let’s take a look at ways you can gain some freedom through refinancing:

  • Save big on interest costs with a better rate — When you refinance your Parent PLUS Loans, you are taking out a loan with a private lender that rewards good credit and stable employment. With interest rates at historic lows, now is a terrific time to reduce your interest rate and the overall cost of the loan.
  • Speed up repayment — Structure your new loan with a shorter term and save even more on total interest.  By increasing your monthly portion paid to principal, you will pay less in interest over the life of the loan and have the loan paid off more quickly. 
  • Get a lower monthly payment with an extended term — On the flip side, you might obtain a loan with an extended term should your finances benefit from a longer repayment period.  This not only spreads out the life of the loan, it also gives you the freedom of additional payment options. For instance, when your finances allow, you can double up on payments without being locked into the larger payment each month.
  • Transfer your Parent PLUS debt into your child’s name — When your child is ready with a solid credit history and stable employment, refinancing can allow you to transfer the debt into your child’s name.  This allows you to offload the debt entirely while giving your child the opportunity to take responsibility for their education and build their own credit history.

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How to compare Parent PLUS Loan refinance rates

Comparing the lenders offering refinancing for Parent PLUS Loans can be overwhelming.  While the internet makes things easier, Purefy has gone a step further by developing a Rate Comparison Tool.  Our tool uses a couple of pieces of your information to provide you with a set of offers from our experienced and highly vetted lender team.

With a choice between premier refinancing lenders, you can compare interest rates and terms, along with other items, and select the lender that offers you the best package. And with our lenders, there are no upfront loan fees and no penalties for prepayment.

Whether you want to transfer Parent PLUS Loans to your student or refinance the debt to create a more manageable budget, Purefy’s rate comparison tool gives you a buffet of options with any lenders that you prequalify with and who are eager to provide you with a solid refi loan. With absolute transparency, you can make an informed choice that will improve your financial situation or help you meet your financial goals.

See How Much You Can Save

Parent PLUS Loan Refinance Calculator

View Details


Parent PLUS Loan rates are often the highest of any federal student loan. Calculate your savings with lower rate and see the impact of paying off PLUS loans faster.

Step 1: Enter Current Loan Information

Loan Balance
Your remaining student loan debt to be repaid.
Interest Rate
The amount that the lender charges in interest, expressed as a percentage.
Current Monthly Payment
The total amount of your monthly student loan bill.
Add Multiple Loans to Calculate

Step 2: Enter New Loan Information

New Interest Rate
Your updated interest rate after refinancing student loans.
The length of time you have to repay your student loan debt in full.

Add Multiple Loans

Insert additional loan

Step 3: See How Much You Can Save


Lifetime Interest


New Monthly



Current Loan New Loan Savings
Rate 6.7% 4.2% 2.5%
Lifetime Interest $37,520 $22,210 $15,310
Monthly Payment $1,146 $1,018 $128

Like what you see? Check your actual prequalified rates from the industry’s top lenders in just 2 minutes or less.

You don’t have to feel stuck any longer

There are a lot of reasons why parents want to refinance (or transfer Parent PLUS Loans to students) from saving money on interest rates to reducing their monthly payments.  Use Purefy’s rate comparison tool to create a sortable list with the best offers and terms available from each lender.  You don’t even need to undergo a credit check for this initial comparison.

Once you have decided upon a lender, they will support you through the process as you secure your new refinanced loan replacing the Parent PLUS Loan(s).  From there, you are free to pursue your financial goals resting easy that you have received a competitive rate and optimal repayment terms for your lifestyle. Check out our rate comparison tool to get the best rates our lenders have to offer at Purefy.

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4 ELFI Rate Disclosure:

Education Loan Finance is a nationwide student loan debt consolidation and refinance program offered by Tennessee based SouthEast Bank. ELFI is designed to assist borrowers through consolidating and refinancing loans into one single loan that effectively lowers your cost of education debt and/or makes repayment very simple. Subject to credit approval. See Terms & Conditions. Interest rates current as of 11-21-2022. The interest rate and monthly payment for a variable rate loan may increase after closing, but will never exceed 9.95% APR. Interest rates may be different from the rates shown above and will be based on the term of your loan, your financial history, and other factors, including your cosigner’s (if any) financial history. For example, a 10-year loan with a fixed rate of 6% would have 120 payments of $11.00 per $1,000 borrowed. Rates are subject to change.

SoFi Rate Disclosure

3 SoFi Rate Disclosure:

Fixed rates range from 3.99% APR to 8.24% APR with a 0.25% autopay discount. Variable rates from 2.24% APR to 7.99% APR with a 0.25% autopay discount. Unless required to be lower to comply with applicable law, Variable Interest rates on 5-, 7-, and 10-year terms are capped at 8.95% APR; 15- and 20-year terms are capped at 9.95% APR. Your actual rate will be within the range of rates listed above and will depend on the term you select, evaluation of your creditworthiness, income, presence of a co-signer and a variety of other factors. Lowest rates reserved for the most creditworthy borrowers. For the SoFi variable-rate product, the variable interest rate for a given month is derived by adding a margin to the 30-day average SOFR index, published two business days preceding such calendar month, rounded up to the nearest one hundredth of one percent (0.01% or 0.0001). APRs for variable-rate loans may increase after origination if the SOFR index increases. The SoFi 0.25% autopay interest rate reduction requires you to agree to make monthly principal and interest payments by an automatic monthly deduction from a savings or checking account. This benefit will discontinue and be lost for periods in which you do not pay by automatic deduction from a savings or checking account. The benefit lowers your interest rate but does not change the amount of your monthly payment. This benefit is suspended during periods of deferment and forbearance. Autopay is not required to receive a loan from SoFi.

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Actual rate and available repayment terms will vary based on your income. Fixed rates range from 4.24% APR to 9.24% APR (excludes 0.25% Auto Pay discount). Variable rates range from 3.49% APR to 8.24% APR (excludes 0.25% Auto Pay discount). Earnest variable interest rate student loan refinance loans are based on a publicly available index, the 30-day Average Secured Overnight Financing Rate (SOFR) published by the Federal Reserve Bank of New York. The variable rate is based on the rate published on the 25th day, or the next business day, of the preceding calendar month, rounded to the nearest hundredth of a percent. The rate will not increase more than once per month. The maximum rate for your loan is 8.95% if your loan term is 10 years or less. For loan terms of more than 10 years to 15 years, the interest rate will never exceed 9.95%. For loan terms over 15 years, the interest rate will never exceed 11.95%. Please note, we are not able to offer variable rate loans in AK, IL, MN, NH, OH, TN, and TX. Our lowest rates are only available for our most credit qualified borrowers and contain our .25% auto pay discount from a checking or savings account.

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Fixed Rate Loan Terms: 5 years/60 monthly payments, 7 years/84 monthly payments, 10 years/120 monthly payments, 15 years/180 monthly payments, or 20 years/240 monthly payments. Annual Percentage Rate [APR] is the cost of credit calculating the interest rate, loan amount, repayment term and the timing of payments. This rate is expressed as an APR. Fixed APRs range from 3.94% to 8.48% APR [low to high range with 0.25% auto-debit rate reduction]. Rates are subject to change without notice. Fixed rates will not change during the term. Since there are no fees associated with this loan offer, the APR is the same percentage as the actual interest rate of the loan including a 0.25% auto-debit rate reduction. These rates are subject to additional terms and conditions, and rates are subject to change at any time without notice. All estimates are based on information provided by you and are for informational purposes only, accuracy is not guaranteed and may not reflect actual rates or savings and do not constitute an offer of credit. Your actual rate, payment and savings may be different based on credit history, actual interest rate, loan amount, and term, including your cosigner [if applicable]. If applying with a cosigner, we use the higher credit score between the borrower and the cosigner for approval purposes. All loans are subject to credit approval.

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