Federal Perkins Loan
In 2015 the U.S. Congress ended the Federal Perkins Loan program. However, current federal regulations extended the program for eligible students through September 30, 2017. Currently, there is no legislation that would enable borrowing through the Federal Perkins Loan program beyond September 30, 2017.
To be considered for a Perkins Loan an undergraduate student must have been offered a Subsidized Federal Direct Stafford Loan up to their full eligibility for the loan period if they previously borrowed a Perkins Loan though BU. If they have not previously borrowed a Perkins Loan through BU they must have been offered an Unsubsidized and a Subsidized Federal Stafford Loan up to their full eligibility for the loan period.
The Perkins Loan 5% interest rate is fixed for the life of the loan. Subsidized and Unsubsidized Stafford Loan interest rates are set annually by the federal government. The maximum annual amount an undergraduate can borrow varies per grade level. Perkins Loan borrowers are not entitled to the same repayment and forgiveness benefits available to Direct Loan borrowers. The Perkins Loan is one of several federal student loans that can, at the borrower’s discretion, be combined upon repayment into a Direct Consolidated Loan and there are certain benefits and draw backs associated with doing so.
Funds for the Federal Perkins Loan are provided by repayments from previous borrowers.
Federal regulations require that the Perkins Loan be awarded to students with exceptional financial need and that the maximum annual undergraduate loan not exceed $5,500. The maximum amount offered will also be limited by the availability of funds in the Boston University Perkins Loan program.
All applicants must submit the Free Application for Federal Student Aid (FAFSA) for determination of Federal Perkins Loan eligibility.
|Interest Rate||Maximum Annual Loan||Interest Charged While Enrolled||Repayment of Principal|
|5%||$5,500||none||9 months after no longer enrolled at least half-time|
Specific details about repayment are outlined in the promissory note, which is sent to students who are awarded and accept a Perkins Loan.
A completed and signed promissory note must be returned before a Perkins Loan can be credited to a student’s account. Loans will be canceled if promissory notes are not returned promptly.
The amount of Perkins Loan awarded to a student will usually decrease in future years as his or her eligibility for the Federal Direct Stafford Loan increases.
The maximum cumulative Perkins Loan amount for undergraduates is $20,000 if the student has completed 2 years of undergraduate work and is pursuing a bachelor’s degree; otherwise, total borrowing cannot exceed $8,000.