Nine Reasons A Federal Perkins Loan Is So Appealing
When you’re ready to go to college, there is much you’ll need to do but the most important thing you have to do after applying to the colleges of your choice is to get financial aid established. You’ll be glad to know that there are all kinds of financial aid to be had including the popular Federal Perkins Loan. Before you go signing on the dotted line, it’s important to know what this loan is and what you can expect from it.
When you are eligible for a grant, you may notice that it doesn’t always cover all your needs. After all, you need to make tuition, get your books (which can run you in the $100s, if not $1,000s,), you need to pay the dorm fees and you need to have a little cost of living money. It is, for this reason, that student loans such as the Federal Perkins Loans or private loans are so popular for a college education. It’s also the biggest reason students are high in debt when they get their diploma at graduation.
Now, federal loans do present some very affordable answers to the money crisis facing students. The ever-popular Perkins Loan is just one component in the arsenal and it has many benefits and features that make the loan very appealing to students.
Nine Appealing Features Of The Perkins Loan
- Ability To Cancel Loan For Eligible Borrowers
- Available Through Colleges and Universities Who Participate
- Available To All Eligible Students (Undergraduate and Graduates)
- Based On Needs
- Fee-Free
- Low-Interest, Low-Cost
- Nine-Month Grace Period
- No Credit Checks
A Look At The Federal Perkins Loan: What It Is and How It Can Help You
When you look at the Federal Perkins Loans, you’ll notice that it’s mainly a campus based financial need, available to both undergraduates and graduates. Colleges and universities that choose to participate will receive an annual Federal Perkins Loan allowance. Out of this, the school financial aid office will decide who deserves the Perkins loan more. Keep in mind that this money is on a first come, first served basis. Thus, if you’re offered it, you should decide early on if you want the money. It’s not uncommon for some schools to add money to the Perkins loan so more students can receive the help. Now, Perkins Loans do not have any fees and are packaged with a nine-month grace period unlike other loans, which are only six-month grace periods.
If you decide to accept the Federal Perkins Loans, you’ll borrow right from the college campus. This is a subsidized student loan, which means the government actually pays the interest so long as you go to school as well as during the grace period. Undergraduates will get a limit of $4,000 a year, with a lifetime of $20,000; graduate students are limited to $6,000 a year with a $40,000 lifetime limit.
Generally, more students qualify for the Stafford Loans and not every college/university will participate in the Perkins Loan program. However, if you look at it carefully, the Perkins loan is the lowest cost loan currently available.
How Does A Student Qualify For Federal Perkins Loans
The biggest factor that’s going to play into whether or not you get a Perkins loan is that you show extreme need for the money. However, that’s not the only deciding factor. You need to fill six other requirements to earn the chance for this loan type.
- You must be enrolled at least halftime (halftime is considered six hours or more).
- You must be enrolled in a college/university that participates in the loan program.
- You must be a U.S. citizen or a permanent resident or eligible non-citizen.
- You must never have defaulted on past educational loans.
- You must be listed with the Selective Service.
- You must have acceptable grades.
How To Apply For A Federal Perkins Loan
Now to get any financial aid, you need to file a FAFSA form so that you’re considered for the Perkins Loan. You cannot request a Perkins Loan, as the government will determine if you’re eligible. After you’ve turned in the FAFSA form, you’ll receive a Student Aid Report (or SAR) through the mail. This will tell you your Expected Family Contribution (or EFC). This amount of money is what you’ll be expected to pay either through loans or out of pocket toward your tuition.
Shortly after this letter, you’ll be receiving the award letters from the colleges you applied to attend to and see what kind of financial aid they are offering to hand out including the popular Federal Perkins Loan. Make sure to sign and return the college letter you want to accept the financial aid from.
Once approved for the Perkins Loan monies, make sure you let the school aware of your decision, as again funds are on a first-come, first served basis.
How To Repay Your Perkins Loan
In the last several weeks of your college career, the financial aid office will give you all the needed information you need on repaying your loan. The loan has a nine-month grace period, which allows you to get settled in and be employed.
Teachers and Loan Cancellation
If you plan to teach, you may qualify for an option to cancel your repayment on the Perkins Loan, either partially or fully. Have plans to teach in special education, a low-income district, a teacher shortage area or in a subject where there’s a shortage, you may qualify for a partial Federal Perkins Loan cancellation.
For more information about the Federal Perkins Loan program check out this handbook.
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