PERKINS LOAN

Federal Perkins Loan is loan program for both Graduate and Undergraduate students which provide a low interest rate to students to meet their financial need. The school of a student lends Perkins loan to students. This Perkins student loan is given from government funds. To apply for Perkins Loan a student has to give a Perkins loan application. Financial need is determined using a standard formula, to evaluate the financial information reported by the student on the Free Application for Federal Student Aid (FAFSA). A undergraduate can borrow 4000$ each year, the total amount a undergraduate student is allowed to draw is $20,000. Where as in the case of undergraduate $6000 is given each year and total amount is $40,000.

The interest charged during repayment of the Federal Perkins Loan is 5%. The government pays interest during in-school period. In case of Perkins Loans, no origination or guarantee fess is required. 9 month grace period is given for repayment of loan. The Perkins Loan has 10 year repayment period.

Students receive Perkins loans from participating institutions after filing the Free Application for Federal Student Aid (FAFSA) to determine their financial need. Under federal Perkins Loan Program, a student, weather a graduate or a undergraduate is charged only if he skips Perkins loan payment, make less than a full payment. Perkins Loan cancellation can be done by informing the school. On the death of the student or a permanent disability there can be Perkins Loan forgivness. During Perkins loan deferment, no interest is accrued and the student is allowed to temporarily postpone Perkins Loan payments. The monthly payment amount for the repayment of the Perkins Loan is determined by the length of the repayment period.