Parent PLUS Loans: goodbye to the Double Consolidation Loophole

Today’s blog is about a unique topic that has recently received a lot of attention recently: the double consolidation loophole.

This once formerly little-known loophole became broadcasted *so loudly* on social media as of late, that even the US Department of Education heard about it – and subsequently issued new legislation that will prevent it from happening in July of 2025. 

Yes, you read that right: the US Department of Education is closing the double consolidation loophole in July 2025.


What is the Double Consolidation Loophole?

In case you aren’t familiar with it: the Double Consolidation Loophole is an unusual type of consolidation that allows parent borrowers to qualify for the SAVE program (and potentially IBR or PAYE). This loophole is tricky to accomplish because you need to process 2 consolidations, simultaneously, with two different loan servicers. Once you’re done with that, you then need to process another consolidation, with yet another loan servicer, to make it work.

It’s a repayment strategy that would make anyone dizzy, and it’s not a process for someone who is inexperienced in working with student loans. Also, neither Federal Student Aid, nor your loan servicer’s customer service representatives, will tell you how to do it. 


So what can Parent PLUS borrowers do?

In spite of the loophole closing in July 2025, there’s no reason to worry. This is not the only repayment strategy that can solve Parent PLUS Loan problems. There are many other ways to use the present system, in compliance with the rules, to benefit you as much as, or more than, the Double Consolidation Loophole ever could.

The only drawback is that these strategies are more borrower specific and must be organized around each borrower’s unique student loan portfolio. Unfortunately, I can’t reveal a new one-size-fits-all student loan secret that can resolve every single Parent PLUS borrower’s repayment challenges. But rest assured that I can find a suitable Double Consolidation substitute that will provide any Parent PLUS borrower with similar student loan repayment relief (or I would refund the consultation fee).  

Also, while the Double Consolidation Loophole is still presently on the table, a consultation can help you discover if this is the right move for you individually – and then implement it, quickly.

I calculate that March 1st of 2025 would be the latest date you can start the process, to be sure to get it all done by July 2025. Any later than that, and you’d be risking the processing time, thus taking you past the deadline.

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