Who is Eligible?

Undergraduate and graduate students are eligible for Perkins Loans. A school must give priority to students with exceptional financial need as defined by the school using procedures it establishes for that purpose. Before an undergraduate student can receive a loan, the school must determine his or her eligibility for a Federal Pell grant. A student who has earned a bachelor's or first professional degree may receive a Perkins Loan to pursue an additional undergraduate degree provided that he or she meets the eligibility requirements and has not borrowed the maximum amounts. A student engaged in a program of study abroad also may be eligible for a Perkins Loan.

Favorable Loan Terms

Perkins Loans have an interest rate of 5 percent, which begins to accrue 9 months after the borrower ceases to be a student - a longer grace period than other federal loan programs. The loans encourage public service, since they can be cancelled for borrowers who go into teaching in low-income areas at Head Start or in special education, nursing, law enforcement, corrections, the military, VISTA, the Peace Corps, early intervention and family service agencies serving low-income children.

Program Success1

In 2006-2007, according to analysts at the Department of Education, over 727,600 students borrowed $1,593,530,180 in Perkins loans, with an average amount of $2,190 awarded per student. As of June 30, 2006, the Perkins Loan Program had a cohort default rate of 8.10 percent, which is extremely impressive when you consider that the borrower population is low-income with financial need. The success of the program reflects the dedication of the educational institutions that originate the loans, and follow up with counseling and careful oversight of servicing and collection. Because Perkins is a campus-based program, the educational institutions can tailor Perkins to best fit an individual borrower's needs. Perkins also is a risk-sharing program with institutions contributing at least 25% of their students' awards, and often more. This "ownership interest" also contributes to the successful management of this vital program.

Since the inception of the Federal Perkins Loan Program in 1958, over $28.8 billion dollars in loans have been made to students through almost 26 million aid awards. The Federal Perkins Loan Program has provided substantial loan assistance to millions of students and families across the country.

Additional Information

For additional information about the Federal Perkins Loan Program contact: