What is a Perkins Loan?
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What is a Perkins Loan?
A Perkins Loan is a type of federal student loan that is awarded to students with exceptional financial need. The loan is named after former congressman Carl Perkins, who was a champion for education.
Perkins Loans are available to both undergraduate and graduate students. Undergraduate students can borrow up to $5,500 per year, while graduate students can borrow up to $8,000 per year. The total amount that can be borrowed over the course of
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Introduction
A Perkins Loan is a type of loan that is awarded to students who demonstrate financial need. The loan is provided by the federal government and is administered by the school that the student attends.
The Perkins Loan program was created in order to help students who might otherwise be unable to afford college. The loans are interest-free while the student is in school, and they have a very low interest rate once the student begins repaying the loan.
Perkins Loans are available to both undergraduate and graduate students. Undergraduate students can borrow up to $5,500 per year, while graduate students can borrow up to $8,000 per year.
What is a Perkins Loan?
A Perkins Loan is a type of federal student loan that is awarded to students with exceptional financial need. The loan is named after its original sponsor, Congressman Carl D. Perkins. Perkins Loans are issued through the U.S. Department of Education and are available to both undergraduate and graduate students.
Perkins Loans have some of the lowest interest rates of all federal student loans, and they also offer a number of other benefits, including deferment and forbearance options, as well as loan discharge for certain public service jobs.
How to Apply for a Perkins Loan
There are two types of Perkins Loans: the Federal Perkins Loan and the Institutional Loan. The Federal Perkins Loan is a need-based loan that is awarded to students with exceptional financial need. The Institutional Loan is a non-need-based loan that is awarded to students who are enrolled in an eligible program at a participating school.
To apply for a Federal Perkins Loan, you must complete the Free Application for Federal Student Aid (FAFSA). You will then be selected for the loan based on your financial need. To apply for an Institutional Loan, you must complete the Perkins Loan Application, which is available from your school’s financial aid office. You will then be selected for the loan based on your enrollment in an eligible program.
Repayment of a Perkins Loan
Repayment of a Perkins Loan begins nine months after a borrower graduates, withdraws from school, or drops below half-time enrollment. There is a grace period of nine months before repayment begins. The interest rate is fixed at 5% for the life of the loan.
Borrowers have 10 years to repay their Perkins Loans. Borrowers who enter public service or teaching positions may qualify for loan forgiveness, which forgives a portion of the loan balance after 120 monthly payments have been made.
Forbearance and Deferment of a Perkins Loan
If you’re struggling to make your Perkins Loan payments, you may be able to get a forbearance or deferment. This will allow you to temporarily postpone or lower your payments.
Forbearance
With forbearance, you can temporarily stop making payments or reduce your monthly payment for up to 12 months. Interest will continue to accrue during this time, so your total loan balance will grow larger.
Deferment
With deferment, you can postponed making payments for certain qualifying periods. Interest will not accrue during deferment on subsidized Perkins Loans and Direct Subsidized Loans. For unsubsidized and all PLUS loans, interest will accrue and be capitalized (added to the principal balance of the loan).
Perkins Loan Cancellation
Perkins Loans are federal student loans offering fixed interest rates and long repayment terms. You may be able to have your Perkins Loan(s) canceled if you meet certain requirements related to your job or service. Check out the requirements below to see if you might qualify. If you do, contact your loan servicer to apply for cancellation.
Eligible cancelation amounts:
-Teachers 100%
-Early childhood educators 100%
-Nurses and medical technicians 100%
-Law enforcement and corrections officers 100%
-Firefighters 100%
-Members of AmeriCorps 100%
-Volunteer in the Peace Corps 70%
Perkins Loan Consolidation
If you have multiple Perkins Loans, you may be able to consolidate them into a single Direct Consolidation Loan. You’ll then have one Perkins Loan payment each month instead of multiple payments. Perkins Loan consolidation can also lower your monthly payment because the repayment period (up to 10 years) is generally longer than the repayment period for a single Perkins Loan. If you consolidate, though, you may end up paying more in interest because you’ll be making payments over a longer period of time.
Perkins Loan Forgiveness
The Perkins Loan program is a federally funded program that provides low-interest loans to undergraduate and graduate students who demonstrate high financial need. The loan funds are provided by the U.S. Department of Education, and the loans are administered by schools that participate in the program.
Students who borrow from the Perkins Loan program may be eligible for loan forgiveness if they work in certain public service jobs, such as teaching or law enforcement. The amount of loan forgiveness varies depending on the type of job and the length of time the borrower has worked in that job.
Perkins Loan Forgiveness is not automatic – borrowers must apply for it and meet certain criteria to be eligible. For more information about Perkins Loan Forgiveness, contact your school’s financial aid office or the U.S. Department of Education at 1-800-873-3399.
