Perkins Loan Deferment
What Does Perkins Loan Deferment Mean To You?
Perkins loan deferment refers to a Federal loan program aimed at college students looking to further their education. A Perkins loan provides low-interest loans to help needy students and is offered directly by the U.S. Department of Education. The Perkins loan is named in honor of Carl D. Perkins, a former member of the U.S. House of Representatives. In 1984, Carl Perkins left behind a legacy of educational opportunity. He fought to support education, especially to children who were under-privileged. He was also instrumental in passing the Vocational and Technical Education Act, another governmental ruling that resulted in more federal money for vocational schooling.
Why is Perkins loan deferment important to you as a college student? This federal loan carries a fixed interest rate of 5% for the duration of a ten-year repayment period. Perkins loan deferment specifically refers to a nine-month grace period after graduation so that borrowers will have a chance to seek employment. Regardless of whether the student graduates, falls below half-time status or withdraws from the chosen college or university, this governmental debt must still be repaid. There are currently 1,800 post-secondary institutions that participate with the Perkins loan deferment program.
Institutional financial aid administrators are the ones that determine the amount of Perkins loans that can be awarded to students who are enrolling at the school or are already attending. How can one qualify for Perkins loan deferment? One must be able to prove to the U.S. Department of Education that he or she is in financial need. This will be determined by information collected from the student by way of the Free Application for Federal Student Aid form. This data is known as the Expected Family Contribution, or EFC. This qualifying criteria consists of the student’s income or assets, the parents’ income or assets, the family’s household size and the number of other family members besides parents that are currently attending college.
This debt cannot be canceled unless a major error has taken place or the student has undertaken selected volunteer service for debt forgiveness. This might include public service organizations, the U.S. military, and teaching institutions. Teachers are eligible for Federal loan cancellation, provided they accept assignments in low-income schools or other areas where there are teacher shortages. The arrangement works by year-a percentage of the loan is cancelled for every year spent teaching full-time.
Never give up! A Perkins loan deferment plan may be the best way to pursue education without falling into major debt.