What happens to student loan debt if the borrower dies?
I had four life changing events happen over a lifetime which kept me either deferred or paying minimum payments. I have paid $30k on a$18 k loan and still owe $5k. I am 63 years old. I have a grand total of $44k saved — $5k in a roth and 39k in an ira. I am deferred yet again. I am NOT going to pay another dime… but am told I will have my wages garnished. What is crazy is this debt isn’t even mine. It is a parent plus. What are they going to do follow me to the graveyard and demand payment from my heirs?
Paddy Hirsch May 19, 2013 Senior Editor, Marketplace
Hi there, I’m sorry to hear about your complicated situation with this loan! The answer to your question is quite simple, however. The lenders will not follow you to your grave — or at least they won’t go after your heirs: ParentPLUS loans are discharged if the borrower dies. Click here for more: http://www.parentplusloan.com/repayment/forgiveness.php
Marketplace is on a mission.
We believe Main Street matters as much as Wall Street, economic news is made relevant and real through human stories, and a touch of humor helps enliven topics you might typically find…well, dull.
Through the signature style that only Marketplace can deliver, we’re on a mission to raise the economic intelligence of the country—but we don’t do it alone. We count on listeners and readers like you to keep this public service free and accessible to all. Will you become a partner in our mission today?