Don't skip these steps when borrowing parent student loans

Many parents take out student loans to help pay for their child’s education. But not all of them share that information with their son or daughter. That silence is an easy misstep for parents who decide to borrow student loans in their own names. Other problems can include unaffordable payments, unclear expectations around repayment and not taking advantage of an opportunity to help the child build credit. To help prevent student debt from derailing their family, parents should assess their financial situation and talk openly with their children before borrowing student loans.

Ext. headline: Assess your financial situation and talk openly with your child before borrowing parent student loans

Eds. note: 4 subheds in all caps

Byline: RYAN LANE of NerdWallet

Bytitle: NerdWallet

In more than one-third of U.S. families, parents decide how to pay for college, according to a July 2020 report from private lender Sallie Mae.

Half of those parents don’t inform the child of their decision.

Joe Allen, 51, of Frederick, Maryland, did talk about college costs with his daughter, a freshman at the University of Dayton in Ohio. But he understands why some families avoid the topic.

“As a parent, you want to protect your children,” Allen says. “You want to do what’s best for them.”

But what seems best for children may be bad for mom or dad — especially if it means taking out hefty parent student loans without discussing them. Here’s how to avoid that misstep and others when borrowing parent loans.

ASSESS YOUR SITUATION

Students should exhaust free money and federal loans in their names to pay for college. Parents can then cover remaining costs with federal parent PLUS loans or private loans.

But first, review your current financial situation with your child.

“Have a...