Federal Perkins Loan


The Federal Perkins Loan Program is designed for students with extreme financial need. These loans are awarded to the students with the greatest financial need within any given college setting.

The Federal Perkins Loan is considered to be a campus-based loan because the lender is actually the college, rather than the Federal government or a financial institution. The Federal government provides a pool of funds to each participating college or university. The academic institution adds funds to the pool then distributes the funds to its own pool of neediest students.

If you’re an undergraduate student, you may borrow up to $4,000 a year with a total maximum of $20,000 borrowed during your undergraduate years. If you’re a graduate student or in professional studies, you may borrow up to $6,000 a year with a total amount of $40,000 borrowed (in both undergraduate and graduate schools). The actual amount you’ll receive depends upon your financial need and the amount of funds your school has available for distribution.

You apply to the Federal Perkins loan program by filing a Free Application for Federal Student Aid or FAFSA. The FAFSA is the universally accepted document that gathers your family’s financial information in a way that allows for calculation of your financial need. Once the college receives your Student Aid Report (SAR), they will develop a financial aid package for you, which may include the opportunity to apply for funds from the Federal Perkins Loan program. If your application is accepted, you will receive notification of an award. You must then sign a federal Perkins Loan Promissory Note and participate in an entrance counseling session.

You will receive the loan proceeds through your school. You will either receive a check or the money will be placed in a student account for you. The loan is usually divided into two payments, unless the loan is for a very small amount. As a Perkins Loan borrower, you don’t have to pay origination or insurance fees.

Payments on your Perkins Loan begin nine months after you graduate or leave school. How much you pay back each month will depend on how much you borrowed and how long you have to repay your loan. You may be allowed to take up to 10 years to pay back your Perkins loan.

In some cases, you may be allowed to postpone your loan payments by either receiving a deferment or forbearance. Read our articles on “Perkins Loan Deferment” and “Perkins Loan Forbearance” to learn more.

Your Federal Perkins Loan may be cancelled or forgiven under certain conditions. This means that you do not have to pay back the money. Please read our articles “Perkins Loan Cancellation” and “Perkins Loan Forgiveness” for more information.

The Federal Perkins Loan program is an excellent way for you and your family to afford the costs of college when you have significant financial need.