Federal Perkins Loan

Terms

One of the lowest cost student loans available, the Federal Perkins Loan is a need-based subsidized loan (interest-free during in-school, grace, and deferment periods). The annual interest rate is fixed at 5 percent, and is not charged until the student enters the repayment period. There are no other fees associated with this loan.

Repayment

Repayment begins up to nine months after the student leaves school. Payment on the Perkins Loan is easily deferred during at least half-time enrollment in graduate school, and for participation in programs such as the Peace Corps. Various loan forgiveness options may be available for work in certain non-profit areas, nursing, police work, and teaching in federally designated teacher shortage areas.

Source

The Perkins Loan is a federal “fund,” which means the federal government allocates a small amount for each participating college every year, and each college adds to that amount what it has collected from borrowers currently in repayment. Therefore, each college has a different “pot of money” to work with and different student needs to be met, so Perkins Loan award amounts may vary from school to school. Repayment of the loan will be to St. Olaf through a servicer employed by our business office.

Eligibility

The Perkins Loan is a need-based loan, and the federal government requires that St. Olaf award it to students with the greatest need. Therefore, students who have remaining need and who demonstrate eligibility based on St. Olaf’s packaging criteria and fund availability will be awarded this loan.

How to apply

In order to be considered for the Perkins Loan, prospective students must complete the CSS/PROFILE form and the Free Application for Federal Student Aid (FAFSA). They will automatically be considered for this program once the forms are received, and eligibility for the Perkins Loan will be presented in an award letter.

Available funds

Awards range from $500 to $4,000 per academic year, depending upon fund availability and the student’s remaining financial need. The 5 percent annual interest rate begins when the repayment period commences and is included in the monthly payment. The repayment schedule is usually for 10 years.

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