Heads up: Parent PLUS loans are now capped at $20,000/year and $65,000 lifetime per student. New 2026+ loans are also limited to Standard Repayment only — no income-driven plans, no PSLF. If your college bill runs higher than $20K, you'll need a plan for the gap — and we've got you covered.
The short version
Work through these one at a time. The whole thing takes about 30 minutes. Steps 2 and 3 use a soft credit pull — meaning no impact on your credit score — so go ahead and run those simultaneously.
Before you look at anything else, accept the Federal Direct Student Loan your school offered. It's $5,500–$7,500/year with no credit check, no co-signer, and federal protections built in. It's always the cheapest dollar on the table. Also worth bookmarking: the CAP Tuition Bill Prep Checklist for all the key deadlines.
College Ave is one of our top picks for parent co-signed loans — competitive rates, no origination fee, and a fast application. Start this at the same time as Step 3 so you can compare both offers side by side.
SoFi's also a great option — no origination fee, covers 100% of your school-certified costs, and comes with unemployment protection if you ever need it. Run this at the same time as Step 2 and you'll have two competitive offers in hand without any credit score impact.
Sallie Mae consistently offers some of the most competitive rates for strong-credit borrowers, but their application does a hard credit pull. That's why we save it for last — once you've seen your soft-pull offers, you'll know whether it's worth applying.
Several states offer their own student loan programs with competitive rates for in-state residents — sometimes even better than the national lenders. Worth a quick 5-minute check before you finalize anything.
You've got your offers. Line them up by APR (not just the stated rate), and don't forget to factor in Parent PLUS's 4.228% origination fee — that alone adds ~$846 to a $20K loan before your first payment. The CAP Private Loan Guide has a full lender comparison to help. Pick the option that's cheapest for your situation.
Not sure exactly how much you need to borrow? Figure out your gap first — it takes less than 10 minutes.
Calculate My Funding Gap →The short answer: Congress added new borrowing limits that didn't exist before. Starting in 2026, Parent PLUS is capped at $20,000/year and $65,000 lifetime per student. If your school costs more than $20,000 after grants and scholarships — and most do — you'll need to cover the difference another way. Here's everything you need to know.
You don't need a spreadsheet. These four numbers tell most families everything they need to know.
| What you're comparing | ✓ Private Loan (top lenders) | Parent PLUS Loan |
|---|---|---|
| Interest rate | Starting under 5% fixed | 9.07% fixed |
| Origination fee | 0% — top lenders charge nothing | 4.228% added to your balance |
| Annual borrowing limit | Up to 100% of your cost of attendance | $20,000/year cap — new in 2026 |
There's no one-size-fits-all answer here. It really comes down to your credit, your career plans, and how much repayment flexibility you might need down the road.
Our honest take: Accept your Federal Direct Loan first — always. Then grab soft-pull quotes from College Ave and SoFi (takes 10 minutes, zero credit score impact). Compare those against what Parent PLUS would actually cost once you factor in the origination fee. For most families with decent credit, private loans are going to win on price — and they're the only option for anything above the $20K cap. Not sure where to start? Calculate your funding gap first →
The new caps and repayment restrictions apply to new borrowers. If you've already taken out Parent PLUS loans, here's exactly where you stand.
Not sure which category you fall into? A free CAP consultation can help you figure out your legacy provision status, consolidation options, and the smartest path forward for your specific loans.
Review our full paying the bill and borrowing toolkit.
