The Federal Perkins Loan

Eligibility for the Federal Perkins Loan is based on demonstrated need using the federal need-analysis formula. Each participating college has a pool of money from which they make these five percent loans directly to students. The college decides the amount of the loan and chooses the recipient. Although you must repay this loan to your school, interest does not accrue while you're a student, and you do not begin repayment until nine months after graduation. Depending on when you apply, your level of need, and the funding level of the school, you can borrow up to $6,000 for each year of graduate or professional study. The total amount you can borrow is $40,000. (NOTE: this includes any Federal Perkins Loans you borrowed as an undergraduate). While a Perkins Loan borrower is not charged any fees, the monthly payment amount will depend on the size of the debt and the length of the repayment period. However, if a payment is skipped, late, or less than the required amount, late charges plus any collection costs will be added. Late charges will continue until the payment is made. If you are attending school at least half time, you have nine months after you graduate, leave school, or drop below half-time status before you must begin repayment. If you're attending less than half time, check with your financial aid administrator to determine your grace period. At the end of your grace period, you must begin repaying your loan. You may be allowed up to 10 years to repay. Deferment & Forbearance
Under certain circumstances, you can also receive a deferment or forbearance on your loan. During a deferment, you are allowed to temporarily postpone payments on your loan and have no interest accrue. Deferments are not automatic. They are usually for special conditions and must be applied for through your school by using a deferment request form. For more details on deferments, contact your financial aid office. If you are temporarily unable to meet your repayment schedule but are not eligible for a deferment, you can receive forbearance for a limited and specified period. During forbearance, your payments are postponed or reduced. Interest continues to accrue and you are responsible for it. Forbearance isn't automatic either. You may be granted forbearance in up to 12-month intervals for up to three years. You must apply in writing for forbearance through the school that made your loan or the agency the school employs to service your loan. You will have to provide documentation to support your request for forbearance and must continue making scheduled payments until you are notified that deferment or forbearance has been granted.