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Best Parent Loans for College

Earnest offers the best loans for parents funding their children’s education
By
Rebecca Safier
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Full Bio
Rebecca has been writing about personal finance for more than seven years. Her work has been published in MarketWatch, U.S. News & World Report, and other publications, and she has contributed expert commentary to Fortune, Money, NBC, and more. 
Learn about our editorial policies
Updated March 04, 2024
Fact checked by
Hans Daniel Jasperson
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Fact checked by Hans Daniel Jasperson
Full Bio
Hans Daniel Jasperson has over a decade of experience in public policy research, with an emphasis on workforce development, education, and economic justice. His research has been shared with members of the U.S. Congress, federal agencies, and policymakers in several states.
Learn about our editorial policies
With the cost of attending college so high, many parents are stepping in to help foot the bill. There are a variety of private lenders offering parent loans for college with flexible terms and competitive rates. You don’t necessarily need to be a parent to borrow, either—some lenders provide parent loans to grandparents or other adults offering financial assistance to undergraduate or graduate students.  To help you choose, we’ve ranked and reviewed the best parent loans for college based on interest rate, fees, repayment terms, and other loan features.

Best Parent Loans for College of 2024

It’s a good idea for your student to exhaust all of their federal student loan options before turning to private student loans. If the student needs additional funding, compare your options for a federal parent PLUS loan with private parent loans for college to determine which type of financing is best for you and your family.

Best Overall : Earnest

Investopedia's Rating
4.9
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Earnest
  • APR Range: 5.62% - 13.49% variable, 4.11% - 16.42% fixed 
  • Loan Amounts: $1,000 to cost of attendance 
  • Loan Terms: Varies
Pros & Cons
Pros
  • Adjustable repayment term 
  • 9-month grace period 
  • Option to skip a payment once per year 
  • Rate match guarantee 
Cons
  • Maximum APR can exceed 14% 
  • Not available in Nevada 
Why We Chose It
Earnest tops our list of the best parent loans for college thanks to its transparent borrowing process and flexible repayment terms. Earnest allows parent borrowers to choose a repayment term with a monthly payment that works for them. 

Plus, Earnest offers a rate match guarantee. If you find a better rate from another lender, Earnest will match it and give you a $100 Amazon gift card. 

Earnest also offers a lengthy grace period with the option to postpone payments or make partial payments while your child is in school and for nine months afterward. Qualifying borrowers can also skip a payment once per year (that payment will be tacked on to the end of your term). 

Earnest provides parent loans in 49 states and Washington, D.C., but it doesn’t lend in Nevada at this time. 

Repayment Options
  • Deferred: Parents have the option to defer payments while their child is in school and for nine months after they graduate. 
  • Interest-only: You can also pay off the interest that accrues on the loan while your child is in school and during the nine-month grace period. 
  • Partial payment: This option has you make monthly payments of $25 right away and continuing throughout the nine-month grace period. 
  • Full repayment: Finally, you can elect to make full principal and interest payments immediately. 
Eligibility Requirements

To borrow a parent loan from Earnest, you must meet the following eligibility requirements: 

  • Be the age of majority in your state 
  • Be a U.S. citizen or permanent resident 
  • Have a FICO score of 650 or higher 
  • Make an annual income of at least $35,000 
  • Borrow on behalf of a student attending an eligible school

Best for No Fees : SoFi

Investopedia's Rating
4.9
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SoFi
  • APR Range: 6.50% - 14.88% variable, 6.32% - 14.88% fixed
  • Loan Amounts: $1,000 to cost of attendance 
  • Loan Terms: 5, 7, 10, and 15 years
Pros & Cons
Pros
  • No fees 
  • Loan terms up to 15 years 
  • Member benefits 
Cons
  • No deferred payment option 
  • Undisclosed credit requirements 
Why We Chose It
SoFi lends parent loans in all 50 states and Washington, D.C. starting at $1,000 and going up to the school-certified cost of attendance. You don’t need to be a parent to borrow, as long as you’re borrowing on behalf of a student enrolled at least half-time in an eligible institution.  SoFi’s parent loans don’t come with origination, administrative, application, disbursement, or prepayment fees, so you only need to account for interest charges when paying back your loan. If you borrow from SoFi, you can access the lender’s member benefits, which include career coaching and estate planning.  While SoFi doesn’t disclose its credit requirements on its website, you’ll likely need strong credit to access its lowest rates. If you set up autopay, you can score a 0.25% discount on your interest rate. Previous SoFi borrowers will also get an additional 0.125% discount on their interest rate. 

Keep in mind that SoFi’s parent loans don’t let you postpone payments completely while your child is in school. You’ll need to cover at least the interest while the student is enrolled. Alternatively, you can choose to start making full payments on your loan principal and interest right away after the loan is disbursed. 

Repayment Options
  • Interest-only payments: Pay only the interest that accrues while the student is in school. 
  • Immediate repayment: Make full and interest payments right away after the loan is disbursed. 
Eligibility Requirements
Here are the requirements to qualify for a SoFi parent loan:
  • Be the age of majority in your state 
  • Be a U.S. citizen, permanent resident, or non-permanent resident alien
  • Borrow on behalf of a student enrolled at least half-time in a degree- or graduate certificate-granting program at an eligible school 
  • Meet SoFi’s underwriting requirements for credit and income 

Note that you don’t have to be the parent or legal guardian of the student to borrow a SoFi parent loan on their behalf. 

Student Loan Marketplace : Credible

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Credible logo.
  • APR Range: Varies by lender, but variable and fixed rates start at around 8.05% 
  • Loan Amounts: Varies by lender, but typically $1,000 to cost of attendance 
  • Loan Terms: 5 to 20 years, depending on lender
Pros & Cons
Pros
  • Access multiple lenders at once
  • Prequalify with no impact on your credit score 
  • Flexible loan terms 
Cons
  • Loan offers limited to Credible’s partners 
  • Offer qualification isn’t guaranteed
  • Additional lender research required
Why We Chose It
Credible is an online loan marketplace that can connect you with multiple lenders at once. All you need to do is enter a few basic personal details, and Credible will show you if you qualify for any loan offers.  This pre-qualification won’t impact your credit, and it doesn’t obligate you to get a loan. By checking your rates with Credible, you can easily compare offers from more than one lender at the same time.  However, your offers will be limited to Credible’s partner lenders, so it may be worth exploring other options as you shop for a loan. What’s more, you may need to visit each lender’s website for additional information about its repayment options and other loan features. 
Repayment Options
Your repayment options will vary by lender, but you may encounter the following options: 
  • Deferred payment: You may have the option to postpone payments while the student is in school and during a grace period after they graduate. 
  • Interest-only payments: Some lenders let you pay only interest while the student is in school.
  • Partial payments: You may be able to make small payments of $25 per month while the student is in school. 
  • Immediate repayment: Immediate payments are full monthly payments (principal and interest) that start soon after the loan is disbursed. 
Eligibility Requirements

Eligibility requirements will vary by lender, but most will want to see that you: 

  • Are a U.S. citizen or permanent resident 
  • Meet credit and income requirements 
  • Are borrowing on behalf of a student who’s enrolled at least half-time in a degree-granting program at an eligible institution 

Best for Low Interest Rates : Iowa Student Loan (ISL) Education Lending

Investopedia's Rating
4.4
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Iowa Student Loan (ISL) Education Lending
  • APR Range: 3.95% - 11.08% fixed 
  • Loan Amounts: Up to school’s cost of attendance 
  • Loan Terms: 10 or 15 years 
Pros & Cons
Pros
  • Option to defer payments 
  • Transparent lending requirements 
  • Option to pre-qualify online 
Cons
  • Only two loan term options 
  • No partial payment plan 
  • Not available in Maine 
Why We Chose It

Despite having Iowa in its name, ISL Education Lending provides parent loans in every state but Maine with fixed rates starting at 3.95%. This lender has clear eligibility requirements for its College Family Loan, sharing that it looks for a minimum FICO score of 660 and debt-to-income ratio under 40%. 

If you borrow from ISL, you have the option of deferring payments while the student is in school. Alternatively, you can elect to make interest-only or full payments right away. ISL Education Lending offers two loan terms—10 or 15 years—though you can choose to pay your loan off faster without penalty. 

Repayment Options
  • Deferred payments: Postpone payments while the student is in school. 
  • Interest-only payments: Pay off the interest that’s accrued right away, then switch to full payments once the student graduates. 
  • Immediate repayment: Start making full principal and interest payments on your parent loan right away. 
Eligibility Requirements
Here are the requirements you need to meet to borrow a parent loan from ISL Education Lending: 
  • Be a U.S. citizen or permanent resident (not available to Maine residents) 
  • Borrow on behalf of a student who’s attending an eligible school at least half-time 
  • No history of student loan default or an active bankruptcy case 
  • FICO score of at least 660 
  • Debt-to-income ratio 40% or lower, including mortgage or rent; without rent or mortgage, the ratio can’t exceed 25%
  • Two years of continuous employment

ISL Education Lending also reviews your credit report to make sure there aren’t recent delinquencies, repossessions, or other negative marks.

Best for Income-Based Repayment : Rhode Island Student Loan Authority

Investopedia's Rating
4.1
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 Rhode Island Student Loan Authority
  • APR Range: 4.45% fixed 
  • Loan Amounts: $1,500 to $45,000 per year 
  • Loan Terms: 10 years
Pros & Cons
Pros
  • Income-based repayment option 
  • Forbearance in the event of financial hardship 
Cons
  • Only one repayment term 
  • Annual loan cap of $45,000
  • Must make immediate payments 
Why We Chose It
Lending in all 50 states and Washington, D.C., RISLA provides parent loans with a fixed APR of 4.45% and a maximum loan of $45,000 per year or the school-certified cost of attendance, whichever is lower.  RISLA offers a single repayment term of 10 years, but you can request income-based repayment if you need to adjust your student loan payments along with your income. This option is rare among private lenders.

RISLA also lets you pause payments through forbearance if you run into financial hardship. Plus, it offers multi-year approval, meaning you can submit a full application once and have a quicker application process in subsequent school years. 

Repayment Options
  • Immediate repayment: Parents must start paying back the loan right away. Partial and interest-only payments are only allowed on student loans with a cosigner. 
Eligibility Requirements
To borrow a RISLA loan, you must meet several requirements:
  • Be a U.S. citizen or permanent resident
  • Borrow on behalf of a student who’s attending an eligible school
  • Meet debt-to-income and liquidity requirements and make a minimum annual income of $40,000

Best for Multi-Year Approval : Citizens Bank

Investopedia's Rating
4.4
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Citizens Bank logo.
  • APR Range: 7.20% - 9.56% variable, 6.49% - 9.56% fixed 
  • Loan Amounts: $1,000 to cost of attendance, up to these aggregate limits: $150,000 for undergraduate degree, $150,000 for graduate degrees, $225,000 for MBA and law, $180,000 or $350,000 for health care, depending on degree
  • Loan Terms: 5 or 10 years 
Pros & Cons
Pros
  • Multi-year approval
  • No origination, application, disbursement, or prepayment fees 
Cons
  • Aggregate loan limits 
  • Only two loan term options 
Why We Chose It
Citizens provides parent loans for college in all 50 states, Washington, D.C., and U.S. Territories. You can borrow up to the school’s cost of attendance as long as you haven’t exceeded the bank’s aggregate loan limits, which vary by type of degree. 

You can choose loan terms of five or 10 years and select deferred repayment, interest-only payments, or immediate repayment. Citizens offers multi-year approval, making the borrowing process easier in subsequent years. 

Multi-year approval lets you submit a full application when the student starts school. In later years, you can go through a more streamlined process if you want to borrow additional money. 

Repayment Options
  • Interest-only repayment: Pay off the interest that’s accrued while the student is in school and during the six-month grace period.  
  • Immediate repayment: Make full payments on the parent loan immediately after it’s disbursed. 
Eligibility Requirements

To borrow a parent loan from Citizens, you must: 

  • Be a U.S. citizen or permanent resident 
  • Borrow on behalf of a student who’s enrolled at least half-time in a degree-granting program at an eligible institution
  • Have good credit 
  • Not have a history of student loan default

Best for Flexible Repayment Terms : College Ave

Investopedia's Rating
4.3
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College Ave
  • APR Range: 5.59% - 16.69% variable, 4.07% - 15.44% fixed 
  • Loan Amounts: Up to the school’s cost of attendance 
  • Loan Terms: 5 to 15 years
Pros & Cons
Pros
  • 11 different loan term options
  • No fees 
Cons
  • Can’t defer payments 
  • Doesn’t disclose minimum credit score requirement 
Why We Chose It
College Ave funds parent loans in all 50 states and Washington, D.C. It offers rates starting at 4.07% and 11 different loan term options between five and 15 years. This lender doesn’t charge any fees, and you can borrow up to your school’s cost of attendance.  As with most other lenders, College Ave will send your loan proceeds directly to your financial aid office, which will apply it toward tuition and fees before sending any remaining funds to you. However, you can request that College Ave disburses $2,500 to you directly, so your student can have that money sooner to use on books, supplies, and living expenses. 

College Ave doesn’t give the option of deferring payments completely while your student is in school. You’ll have to at least pay the interest that accrues on your loan after it’s disbursed. You can make full or partial payments on top of your interest payments. 

Repayment Options
  • Interest-only repayment: Pay off the interest that’s accrued while the student is in school.
  • Interest plus payments: Pay the interest plus an additional amount of your choosing while the student is enrolled. 
  • Immediate repayment: Make full payments on the parent loan immediately after the loan is disbursed. 
Eligibility Requirements

College Ave lends in all 50 states and Washington, D.C. To qualify, you must: 

  • Be a U.S. citizen or permanent resident 
  • Borrow on behalf of a student enrolled in an eligible school who’s making satisfactory academic progress 
  • Meet College Ave’s requirements for credit and income 

Final Verdict

Earnest provides some of the best private parent loans for college, as it offers flexible loan amounts and terms, a streamlined application process, and transparent requirements. However, it’s always worth shopping around to find the best loan offer.  Citizens, for instance, may be a better option if multi-year approval is a priority. SoFi is another top pick for competitive rates and no fees. And Credible makes it easy to check your rates with multiple lenders at once.  By taking the time to compare options from multiple lenders, you can find the right parent loan to help fund your student’s education. 

How to Choose the Best Parent Loans for College

Parent loans provide funding for your child’s college or graduate school costs. You can use the loan on qualified education costs and pay it back over time, with interest. With parent loans, the parent is the primary holder of the loan and is responsible for paying it back. This is different from co-signing a student loan, where the student is the primary borrower and the co-signer only becomes responsible for repayment in the event the student falls behind on payments. 

If you don't have immediate need for a loan, take some time to improve your credit before you apply. Steps like reducing your credit utilization ratio, paying down debt, and disputing errors on your credit report can all improve your credit and help you access better interest rates on a loan.

Factors to Consider for Parents Taking a Loan for College

When taking out a parent loan on behalf of a student, here are some factors to consider before you borrow: 
  • Interest rates: One of your top priorities should be finding a loan with the lowest interest rate so you can keep your costs of borrowing down. 
  • Fees: Along similar lines, keep an eye out for fees that could make your loan more expensive, such as origination, disbursement, or application fees. 
  • Repayment term: Find out how long you have to pay back the loan, as your loan term will directly impact how much you pay each month. 
  • In-school repayment options: Consider whether the lender lets you defer payments while the student is in school or requires you to make payments right away. Even if immediate payments aren’t required, it could be a good idea to start paying the loan back as soon as you can to cut down on interest charges. 
  • Monthly payments: When comparing your loan options, make sure to choose one that has a monthly payment you can afford. 
  • Credit requirements: Find out what the lender’s borrowing requirements are, whenever possible, to ensure you can meet qualifications. 
  • Borrower protections: Some lenders let you postpone payments in the event of financial hardship, which could be helpful if you’re worried about job loss. 
  • Customer support: Finally, make sure to choose a lender with helpful and accessible customer support, whether through phone, email, or web chat. 

Private Parent Loans vs. Federal Parent PLUS Loans

There are two loan options for parents: private parent loans and federal parent PLUS loans. Private parent loans come from private lenders, such as banks and credit unions. Federal PLUS loans come from the federal Department of Education. 

To borrow a private parent loan, you must meet a lender’s underwriting requirements for credit and income. Federal parent PLUS loans may be easier to qualify for, as the government simply requires that you don’t have adverse credit. If you do have adverse credit, you can still qualify by applying with a creditworthy endorser. 

Private parent loan interest rates can vary and may be fixed or variable. PLUS loans, on the other hand, have a fixed interest rate. PLUS loans currently have an interest rate of 7.54% and an origination fee of 4.228%. 

PLUS loans, like most federal student loans, are eligible for a variety of repayment plans, including the standard 10-year plan, an extended plan (up to 25 years), and Income-Contingent Repayment (if you consolidate them first). They can also qualify for federal protections, such as deferment, forbearance, and forgiveness programs. 

Private parent loans have various terms, typically between five and 15 years, depending on the lender. They’re not eligible for federal forgiveness plans. 

Frequently Asked Questions

  • How Are Parent Loan Interest Rates Determined?

    Lenders offer a range of interest rates based on a market index, such as the Secured Overnight Financing Rate (SOFR), which is based on transactions in the Treasury repurchase market. Private parent loan rates may be fixed or variable. 

    Lenders offer the most competitive rates to borrowers with the strongest financial credentials—a borrower with excellent credit, steady income, and a low debt-to-income ratio. Borrowers with weaker credit will get assigned a rate on the higher end of the lender’s range (or not qualify for the loan at all). 

  • Can a Parent Loan Be Transferred to the Student?

    It may be possible to transfer a parent loan to the student if the student refinances the loan in their own name. In this case, the student would have to qualify for student loan refinancing on their own and meet a lender’s underwriting requirements for credit and income.

  • How Does Parent Loan Repayment Work?

    Parent loan repayment options will vary by lender. Some lenders let parents defer payments while the student is in school and for a six- or nine-month grace period after they graduate. Others require that you make interest-only or full payments right away after the loan is disbursed. 

    When you borrow, you may have a choice of loan terms, which typically span anywhere from five to 15 years. As you pay off the parent loan, a portion of your payment will go toward interest charges and the rest will go toward the principal balance.

  • What If the Parent Loan Holder Passes Away?

    There’s no standard rule for what happens to a private student loan when the primary loan holder dies. In some cases, the loan may become part of the estate. In others, the lender will discharge the loan. Read over your loan agreement to find out what happens to the loan in the event of death or disability.

Methodology

Investopedia is dedicated to providing consumers with unbiased, comprehensive reviews of student loan lenders. We collected thousands of data points across 30 lenders—including loan types, interest rates, fees, loan amounts, and repayment terms—to ensure that we help readers make the right borrowing decision for their education needs.
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Article Sources
Investopedia requires writers to use primary sources to support their work. These include white papers, government data, original reporting, and interviews with industry experts. We also reference original research from other reputable publishers where appropriate. You can learn more about the standards we follow in producing accurate, unbiased content in our editorial policy.
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  6. SoFi. "," Select "Private Student Loans—Parent Loans."
  7. SoFi. "."
  8. Credible. "."
  9. Credible. "."
  10. Credible. "."
  11. ISL Education Lending. "."
  12. ISL Education Lending. "," Select "What Are the Credit and Underwriting Requirements to Qualify for a College Family Loan?"
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  14. ISL Education Lending. "," Select "Am I eligible for a College Family Loan?"
  15. RISLA. "."
  16. Citizens. "."
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  21. Federal Student Aid. "."
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  24. Federal Student Aid. "."
  25. Federal Student Aid. ""
  26. Federal Reserve Bank of New York. "."
  27. Student Loan Borrower Assistance. ""
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