Qualifying for grant is good but that doesn’t mean that grants will cover your entire tuition costs, books, dorm fees and the cost of living in general. That’s why loans are needed to counter those financial needs in college. This is the main reason also for which students are knee deep in debt when they graduate.

Federal student loans are the most affordable loans for students and the Perkins Loan is a major component in the federal student loan arsenal. Perkins Loans have plenty of benefits and features that make it an excellent loan for eligible students.

Perkins Loans are having following major features:

• Low cost and interest rate
• Need based
• Available through participating colleges and universities
• There is optional loan cancellation for eligible borrowers
• Available for eligible undergraduate and graduate students
• Grace period of 9 months
• No-Fee
• No credit check is required

Explanation of Federal Perkins Loan

The Perkins Loan program is a campus based financial aid and it’s available for both undergraduate and graduate eligible students. Annual Federal Perkins Loans are received by participating in colleges and universities. The schools determine which are the most financially deserving students for Perkins funds. Money is awarded on first come, first served basis so it’s necessary for students to accept as early as possible when they qualify for the Perkins Loans. Some of schools pad the Perkins loans with their own funds so that more students can qualify. Perkins Loans are fee-free with 9 months grace period unlike other federal loans, which are usually having 6 months grace period.

When you accept the Perkins Loan then you can borrow from any campus of your choice. This is a subsidized loan; means that government will the interest that accrues on your loan while you are in school and during the grace period. An undergraduate student is limited to $4,000 per year with a lifetime limit of $20,000; and for a graduate student limit is $6,000 a year and $40,000 lifetime limit.

Most of students qualify for a Stafford Loan and not all colleges and universities participate in the Perkins program, while in the grand scheme of things the Perkins Loan may be the lowest cost loan available.

Requirements for a Perkins Loan

The main requirement for qualifying for a Federal Perkins Loan is showing exceptional financial need. However aside from income brackets there are also few other requirements you need to know about. Such as:

• You must be enrolled in school at least half –time.
• You must be enrolled in that college or institution that participates in the program.
• You must be a U.S. citizen, a permanent resident or a non-citizen that is eligible.
• You won’t be having any defaulted history on an education loan in the past.
• You must be registered with the Selective Service.
• You must be having at least satisfactory grades.

Applying for a Perkins Loan

As for all federal aids its necessary to file FAFSA, same its necessary to file FAFSA in order to be considered for a Perkins Loan. After filing FAFSA government will determine your eligibility, you can request Perkins Loan assistance. When you will submit your FAFSA then you should receive your Student Aid Report (SAR) in the mail. Your Expected Family Contribution (EFC) is outlined in the SAR. The EFC is amount of money that you will pay out of your pocket or with loans for your tuition. After few weeks you will also receive award letters from the colleges to which you had applied detailing the types of financial aid you have qualified for, may be included with Perkins Loan. You must have to return the award letter indicating what financial aid you are accepting in order to receive any money.

If you will be approved for Perkins Loan funds then you must let your school know and the sooner the better; funds are limited and often disbursed on a first come, first served basis.

Repayment of the Perkins Loan

In the last few months of your college education your school provides you with loan repayment information related to Perkins Loan. You will be having 9 months grace period so that you can get settle and get a job before your repayment kicks in.

Loan Cancellation for Teachers

Students who go into public teaching jobs may qualify for Perkins Loan cancellation on whole or a part. If you are having plan to teach in a low income public school district, teaching special education students, teach in a shortage area, or teach a subject designated as a shortage (science, math, foreign language) then your Perkins Loan will be partially canceled for every year you served.