Perkins Loans

For students entering colleges and universities and looking for the various financial aid sources available by both private entities and government agencies, several programs appear very much alike but are available to a diverse group of students. Low-interest government Perkins Loans programs are available to help the graduate and undergraduate students in high financial need. There are approximately eighteen thousand postsecondary institutions where students can apply for the Perkins loans to help with their education costs. In order to meet the requirements for a Perkins loan, students must first fill out a Free Application for Federal Student Aid (FAFSA). The FAFSA is what the U.S. Department of Education uses to evaluate the student's financial needs and determine the expected family contribution or EFC of the student. Other eligibility requirements in addition to the expected family contribution score to qualify for a federal Perkins loan include maintaining an acceptable academic process. Students must also show extreme financial need; be a United States citizen or an entitled non-U.S. citizen with a legal social security number; or a male student between eighteen and twenty-five years of age that has filed or registered with the Selective Service. Students must have a GED, high school diploma or pass an authorized ABT or ability-to-benefit test and be working toward getting a certificate or degree in an eligible program. Students that received a Federal Pell Grant have precedence for Perkins loans.

It is extremely important for students applying for Perkins loans to do this early because Perkins loans are government financial aide that the schools distribute on a first come, first serve basis. In other words, once the funds are gone, there are no more Perkins loans available even if you qualify for the loan. With steady five percent interest rates, it is best for students to submit their FAFSA as early as possible. This is the best way for a qualifying student to receive the largest possible Federal Perkins Loan funds that they are eligible to receive.  Up to twenty thousand dollars is the total amount of the federal Perkins loan available to students over the complete undergraduate program or four thousand dollars annually. The amounts are higher for graduate students, with a forty thousand dollar total over the complete graduate study course or six thousand dollars annually. With its low five percent interest rate, private loans, Stafford loans or other loans cannot compete with the Perkins loan, so it is a wise for students to take their full eligible amount. In addition, a student does not require a co-signer to get a Federal Perkins loan, which makes this an excellent first loan. Even with bad credit or if students have not established any credit to date, they still qualify to get this loan. The most attractive benefit of the students Perkins loan is that the federal government pays the interest while students have any kind of Perkins loan deferment period. For the federal government to do this, students must attend school at least half time. The amount of interest money saved before the student starts paying off their loan could end up being thousand of dollars.

Resources:

• Federal Perkins Loan