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The Perkins Loan Major Overview

September 5, 2011

The Perkins Loan

the perkins loan

If you are either in college or going to enter into college soon, chances are that you have heard of the Perkins Loan as it is one of the biggest federal loan programs around and has loan billions to borrowers. The Perkins Loan can be an excellent resource to use when you are in need for finances to pay for tuition as well as other expenses that come with college life. To get you familiar with the Perkins Loan, below will be an overall overview of the major details as well as the the explanation of the deterination process of how much money you will get out of the program.

The Perkins Loan – Major Overview

The Perkins Loan is considered a needs based loan that is offered by the US Department of Education and can be obtained through 1800 post secondary institutions. It is also cosidered a subsidized loan which means that the students who partake in the loan program will not have to pay interest payments while in school, the government actually pays it for them and doesn’t not require them to repay this interest. Here are some of the terms of the Perkins Loan:

  • Fixed Interest Rate at 5 percent (Fixed interest rates mean they will never change throughout the life of your repayment).
  • It has a 9 month grace period (You don’t have to pay loan payments or interest for 9 months after you either graduate or drop out).
  • Ten year repayment plan.
  • Borrowing terms are as follows: undergraduates can get up to 5,500 dollars per academic school year, and graduate students can borrow up to 8,000 dollars. The entire amount that you are able to borrow throughout the whole time you are in college is 60,000 dollars.
  • Student loan foriveness is available to students borrowers who do cetain public service jobs, teaching jobs as well as enlist in the military. These student forgiveness programs can enable one to get most or all of their debt wiped away. The graduating scale is often determined for what amounts of your debt will be forgiven, 15 %paid for the first and second year of work, 20 %  for year three and four, and 30 percent for the fifth year of service.

The Perkins Loan – How Much You Will Get (EFC)

How much a student will get through the Perkins Loan program is determined by the information in which is stated on the Free Application of Federal Student Aid (FAFSA) which takes into consideration your EFC or Expected Family Contribution when it comes to the financial help you will be getting from your family. The factors that are determined when it comes to the EFC is:

  • Students Income (As well as the students asses if in fact that are living independent from parents).
  • The Parents Income (For dependant children this also includes their assests.
  • Size of the household.
  • The number of children that are attending college.

After you fill out your FAFSA for Perkins Loan financial aid, you will receive in the mail or email the Student Aid Report (SAR) which will tell you how much you qualify for in the form of your Expected Family Income.