The Federal Perkins Loan is a campus-based loan because the lender is actually the college, rather than the Federal government or a financial institution. The Federal government allots funds to each participating college or university.   The college or university then distributes the funds to the students who have the greatest financial need.

To see if you qualify for a Perkins loan you first need to fill out your FAFSA. Once you have completed this application it will be automatically sent to the college or university that you have been accepted to.  They will then generate a Student Aid Report, and determine the different types and amounts of financial aid you qualify for.  The institution will then send you an Award letter notifying you of all eligible aid and it is up to you to decide whether to accept or decline any of the funds.

The amount you are allowed to borrow depends on your student classification:

• Undergraduates are allowed to borrow up to $4,000 per year, with a max of $20,000 during your undergraduate years.

• Graduate and Professional study students may borrow up to $6,000 per year, with a max of $40,ooo. note (this  is a combined total which includes your undergraduate total already accumulated).

Perkins Loan Deferment:

A Perkins loan deferment is a nine-month grace period given to borrowers after graduation so that they have a chance to find employment.  There are a number of careers that can prolong the amount of time you have to start paying back you Perkins loan.  Most lenders that carry your loan will have a form that you need to fill out and require a written description of the daily duties of your job.  You will then be able to defer your payments for the next year, so long as you do not change your employment status.

Perkins Loan Cancellation:

One of the benefits of the Perkins Loan is the broad range of opportunities for Perkins Loan cancellation. Cancellation means that you do not have to make any more payments on the loan balance.

Perkins Loans may be completely canceled in certain circumstances, including if you are a:

• Full-time teacher in a designated elementary or secondary school serving students from low-income families
• Full-time teacher at any school of math, science, foreign languages, bilingual education, or other fields designated as teacher shortage areas
• Full-time special education teacher (includes teaching children with disabilities) in a public or other nonprofit elementary or secondary school)
• Full-time qualified professional provider of early intervention services for the disabled
• Full-time employee of a public or nonprofit child- or family-services agency providing services to high-risk children and their families from low-income communities
• Full-time nurse or medical technician
• Full-time law enforcement or corrections officer
• Full-time staff member in the education component of a Head Start Program
• Vista or Peace Corps volunteer (up to 70%)
• Active duty servicemember in the U.S. Armed Forces (up to 50% in areas of hostilities or imminent danger)

Perkins Loan Consolidation:  *note: this might not be a smart choice for your Perkins loan!

Loan consolidation can be a  great way to manage your college debt. You can often reduce your monthly payments!  Consolidation extends your repayment time line from the standard 10-year repayment to up to 30 years, depending on the amount you consolidate.

In some circumstances if you consolidate your Perkins loan you could be losing all of the benefits that make this loan so great.  If you are working in any of the careers listed in the cancellation section you should talk with your school’s financial aid department to determine if consolidation is the right choice for you.