Are Parents Responsible For Student Loans

Q: Are parents responsible for student loans of their children? I see that FAFSA requires information from the parents, does this leave the parents liable or responsible for their child’s student loans if they go unpaid?

A: For most Federal Student Loan Programs (applied to via FAFSA), the parent(s) cannot be held responsible for their child’s student loans. The only exception to this would be for Federal Parent PLUS loans. Federal Parent PLUS loans can be borrowed by the parent(s) of an undergraduate student to help pay for the student’s education and related costs. With a Federal Parent PLUS loan, the parent(s) is completely responsible for the loan and not the student, however there is no obligation for parents to take out a Federal Parent PLUS loan; it is simply an additional option in the Federal Student Loan Program offerings.

As for FAFSA, the information required of the parents for dependent students helps to determine the students financial need (federal student loans are based upon a students financial need) for federal student loans such as the Perkins loan and Stafford loan. Parents are not held responsible for repaying any of these federal student loans, only the student is. Parents are also not required or allowed to cosign on federal student loans for their child. Parents ARE allowed to cosign on a private student loan for their child, in the case of private student loans that a parent cosigns for their child, the parents can be held responsible for those loans should the student default.