Federal Perkins Loan
AFederal Perkins Loan,also referred to as aPerkins Loan,was aneed-basedstudent loanoffered byU.S. Department of Educationfrom 1958 until 2017.[1]Created as part of theFederal Direct Student Loan Program,the Perkins Loan served to assistAmericancollegestudents fund theirpost-secondary education.The program was named afterCarl D. Perkins,a former member of theU.S. House of RepresentativesfromKentucky.
Provisions[edit]
Perkins Loans carried a fixedinterest rateof 5% for the duration of the ten-year repayment period. The Perkins Loan Program had a nine-month grace period, so that borrowers began repayment in the tenth month upon graduating, falling below half-time status, or withdrawing from their college or university. Since the Perkins Loan wassubsidizedby the government, interest did not begin to accrue until the borrower began to repay the loan.
In the 2009–2010 academic year, the loan limits for undergraduates were $5,500 per year with a lifetime maximum loan of $27,500. For graduate students, the limit was $8,000 per year with a lifetime limit of $60,000 (including undergraduate loans).
Cancellation eligibility[edit]
Perkins Loans were eligible forFederal Loan Cancellationfor individuals choosing to work in a number of different public service occupations including early childhood education, elementary and secondary school teaching, speech therapy, nursing, law enforcement, librarian, public defense attorney, fire fighting and certain active duty military postings.[2]Depending on the field of employment, further restrictions on the setting of employment may apply.
For example, forgiveness for teachers may be restricted to designated low-income schools or specific teacher shortage areas such as math, science, and bilingual education and forgiveness for nurses requires employment at a non-profit medical facility. A percentage of the loan was cancelled for each year spent teaching full-time (as long as the loan remains in good standing). This cancellation also applies to Peace Corps Volunteers. Cancellation typically occurs on a graduating scale: 15% for year 1, 15% for year 2, 20% for year 3, 20% for year 4, 30% for year 5. These percentages were based on the original debt amount. Thus after 3 years of service, one would have 50% of their original debt cancelled.[3]
End of program[edit]
On September 30, 2017, the Federal Perkins Loan program failed to renew in Congress, thus effectively ending the loan program.[1]
See also[edit]
External links[edit]
- U.S. Dept. of Education: Federal Perkins Loans
- U.S. Dept. of Education: Federal Perkins Loan Teacher Cancellation
- U.S. Office of Management and Budget: Federal Perkins Loans Program Assessment
References[edit]
- ^abHutchins, Arianne (2019-07-24)."What Happened to the Federal Perkins Loan?".U.S. News.Retrieved2020-06-09.
- ^US Dept. of Education."Federal Perkins Loan Cancellation and Discharge Summary".studentaid.ed.gov.Retrieved18 February2015.
- ^"Perkins Loan Cancellation and Discharge".Federal Student Aid.2018-11-07.Retrieved2020-06-10.
- ^https://studentaid.gov/understand-aid/types/loans/plus
- ^abhttps://studentaid.gov/understand-aid/types/loans/subsidized-unsubsidized
- ^https://studentaid.gov/manage-loans/consolidation
- ^abhttps:// mohela /DL/resourceCenter/glossary.aspx
- ^abhttps://studentaid.gov/help-center/answers/article/ffel-program
- ^https://fsapartners.ed.gov/knowledge-center/topics/health-education-assistance-loan-heal-information
- ^abhttps://studentaid.gov/help-center/answers/article/stafford-loan