This is a question I hear from parents all the time, and the short answer is: not usually. The FAFSA does ask for parent financial information, but that doesn’t automatically make a parent financially responsible for their child’s student loans. The key is understanding what type of loan your student is taking out and whether a parent signs or borrows anything in their own name. Once you break the loans into categories, the rules become much easier to understand.
For most federal student loans, parents are not responsible for repayment. When your student fills out the FAFSA and qualifies for federal loans—such as Direct Subsidized or Direct Unsubsidized Loans—those loans are in the student’s name only. The student is the borrower, and they’re the one legally responsible for repayment.
The FAFSA asks parents to provide financial information, but that’s only used to calculate the student’s eligibility for aid. It helps schools determine how much need-based aid the student may qualify for, but it does not put parents on the hook for the loan payments. This is a point many families misunderstand: providing financial details on the FAFSA does not create any financial liability.
Direct Subsidized and Unsubsidized Loans—formerly known as Stafford Loans—as well as the now-discontinued Perkins Loan program, are all student-held loans. They don’t require a parent to sign or guarantee anything. Once the student graduates, leaves school, or drops below half-time enrollment, they are the one who enters repayment.If you are a parent preparing a child for college, you can find everything you need by visiting our comprehensive section on College Planning for Parents.
Subsidized loans give students an extra advantage because the government covers the interest while the student is in school. Unsubsidized loans begin accruing interest right away. Perkins Loans (for students who still have them from older years) were low-interest, need-based loans issued through the school, but no new Perkins Loans have been issued since 2017.
In all of these cases, if the student misses payments or defaults, it affects the student’s credit—not the parent’s. Parents only become responsible if they take out or sign for a loan in their own name.
Parent PLUS Loans are the one major federal loan type where parents are responsible. This loan is taken out by the parent—not the student—to help cover the cost of attendance. Because the loan is issued to the parent, the parent is the borrower and fully responsible for repayment, regardless of whether the student graduates or helps with payments.
Parents must pass a credit check to qualify. They can borrow up to the full cost of attendance minus any other aid. Parent PLUS Loans also have deferment and forbearance options, and parents may access income-driven repayment by consolidating the PLUS Loan into a Direct Consolidation Loan. However, PLUS Loans still do not have the same broad protections and affordable IDR terms available to student-held federal loans. Families should think carefully about the long-term impact before taking on this level of debt.
Private student loans are where many parents unknowingly take on liability. Most students don’t have enough credit history or income to qualify for private loans on their own, so lenders often require a parent to cosign. When a parent cosigns, they become equally responsible for the loan. If the student misses payments, the lender can pursue the parent for the balance.
Cosigning can help a student access better rates, but it comes with real risks. A default can damage the parent’s credit, limit their ability to borrow for other needs, and trigger collection activity. Unlike federal loans, private loans generally offer fewer repayment protections and limited opportunities to adjust terms if the borrower experiences hardship.
Default has serious consequences regardless of loan type. For federal student loans in the student’s name, default can lead to wage garnishment, tax refund seizure, and loss of federal aid eligibility. Students also lose access to programs like income-driven repayment until the loan is brought back into good standing.
If a parent defaults on a Parent PLUS Loan, the consequences are similar: wage garnishment, damaged credit, and collection activity. And for private loans, both the student and the cosigner may face legal action, damaged credit, and aggressive collection efforts. Private lenders have more latitude in how they pursue repayment, and options for relief are limited.
In most situations, parents are not responsible for federal student loans taken out by their child. The major exceptions are:
Outside of those cases, the financial responsibility stays with the student. Before taking out any loan—federal or private—it’s important for both students and parents to understand who the borrower is, what repayment options exist, and how missed payments will affect the family financially. When in doubt, ask questions early. A clear understanding upfront helps avoid unpleasant surprises later.
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