A Federal Perkins Loan is a low-interest rate loan for students. Perkins funds are very limited and reserved only for students with the highest financial need as determined by completing and filing the
Free Application for Federal Student Aid (FAFSA). Not all colleges participate in the Perkins loan program.
When you accept a Perkins Loan, signing the Master Promissory Note (MPN) is your promise to repay the loan. Before any funds are disbursed to you, you must attend an entrance counseling session that explains the terms and conditions of the loan (your college will advise you how to fulfill this requirement).
The interest on Perkins loans is fixed at 5%. Your scheduled payments will be at least $40 per month beginning nine months after you graduate or leave school (the nine months between graduation and beginning payment is called a "grace period"). Although you normally have up to 10 years to repay these loans, there are repayment plans that may give you additional time depending upon the amount you borrow. Remember however, the more time you take to repay your loan the more interest you will end up paying.
The maximum amount of money you can borrow for a bachelor’s degree is $4,000 per year with a combined total limit of $20,000. The amount you can borrow as a graduate or professional student in a single year is $6,000 and the combined total (for undergraduate and graduate studies) cannot exceed $40,000. While the program provides for these maximum amounts, because of limited funds availability students seldom receive maximum awards.
To repay a Perkins Loan you will usually pay the college through its Perkins Loan servicer.
No matter which loan(s) you decide to accept, be a wise borrower and only borrow what you need to pay for your educational expenses each year. The SLOPE Calculator and the Loan Repayment Guide can help you determine this amount.