- Danet Henry, a single mother of two, is $49,000 in debt after funding a child’s college education.
- She estimated that the balance would double when her youngest daughter graduated from college.
- She told Insider that she knew the debts needed to be paid off, but she wanted relief for the parents to be on the table.
When Danet Henry’s two daughters were born, she didn’t think she would fund their education alone.
But after a divorce, and what she said was an unexpected lack of child support, Henry had to decide between delaying college for her kids and going into debt herself. She chose the latter.
“College is what they always wanted,” Henry, 53, told Insider. “Especially my oldest. She knew she was going straight to college. And when my youngest said she was going, I wasn’t going to stop her.”
To ensure his children could achieve their college aspirations, Henry turned to Parent PLUS Loans – a type of federal loan for parents that covers the full cost of attendance minus any financial aid that the child has already received.
Henry withdrew the maximum amount for his eldest daughter, who graduated in three and a half years from a public college in 2021 on a partial scholarship and about $8,000 in student loans per semester under her own name as well. Henry now has nearly $49,000 in student debt which she says will double once her youngest daughter graduates from college in 2025, given that lenders typically don’t start collecting payments until six months after the end. of a student’s studies.
While PLUS loans provide a financial reprieve for parents who cannot afford to pay for their children’s college experiences out of pocket after graduation, debt on these loans can pile up faster than expected. . PLUS loans have the highest interest rate of all federal loan options – 6.28% – and since the federal lender does not assess a relative’s income when the loans are disbursed, it is easy for a parent to withdraw more than they can afford to repay. Although President Joe Biden has given targeted student loan forgiveness to certain groups, parents are unlikely to be one of them.
Henry said she was aware that since she had taken out loans, it was her obligation to repay them. But with the number of loan repayment and forgiveness schemes, she wished parents like her could be included in some form of assistance or relief, rather than paying the cost of sending their children to college for most of the rest of the year. their lives.
“I’m the only provider, and it’s the only way for my kids to get an education and succeed,” Henry said, referring to taking out PLUS loans. “It would be a huge relief to be included in some form of forgiveness program.”
“I certainly will not be able to make these payments”
Before the pandemic, Henry had a telecommunications job in Texas with an income that kept her family “financially afloat,” she said. But after a layoff, Henry’s income took a hit, and she now earns a five-figure salary with a security job.
She said she didn’t know what her monthly payments would look like after the payment break expired, but she knew paying them would be a challenge. Payments are expected to resume on May 1.
“I definitely won’t be able to make those payments,” Henry said.
It’s not that Henry didn’t do his research before taking out loans. She said she had a financial aid representative explain her options to her, and while she determined PLUS loans were her best bet for sending her children to school, she said that the loan companies were “really trying to make it a one-stop shop”. easily take out loans.
This is a key feature of PLUS Loans that a number of parents have noticed. Insider previously spoke with Jeff O’Kelley, who has $104,000 in student debt for his son’s education through a process he described as “extraordinarily simple.” Robert Pemberton — a dad with $265,000 in student debt for his two children — told Insider the loan process seemed to be “on autopilot” and all he had to do was “sign a paper “.
“Loan forgiveness for parents would be such a relief”
During his campaign, Biden pledged to approve $10,000 in student loan forgiveness for each federal borrower. But the parents didn’t seem to be included in that plan, and Henry said she wished they weren’t.
“I know there are other forgiveness programs out there right now, but I don’t meet any other criteria,” Henry said. “Loan forgiveness for parents would be such a relief.”
At this point, however, it is unclear whether a borrower will soon receive student loan relief. While Biden has extended the pause on student loan payments three times during his presidency, payments are expected to resume on May 1. And even as lawmakers and lawyers have pushed for another extension of that pause or cancellation of the student loan, Biden and his administration have expressed reluctance to do so, placing the matter in the hands of Congress to the place.
Henry said she was glad targeted borrowing groups had already had some debts forgiven, such as those defrauded by for-profit schools, but she wanted parents to be relieved as well.
“There are already forgiveness initiatives” of $10,000 and $20,000, Henry said. She added: “But that’s only for certain groups, and we’re not one of them. It puts a lot of pressure on a parent.”
Do you have a story to share on student debt? Contact Ayelet Sheffey at asheffey@insider.com.
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