Perkins Loan
The Perkins Loan carries a 5% fixed interest rate and repayment doesn’t begin until 9 months after the student graduates or drops below half-time attendance. Once in repayment, the standard term is 120 months.
So, how do I get a Perkins Loan? The school you attend is allocated funding for the Perkins Loan by the government who leaves it up to the school to determines your eligibility. Eligibility for Perkins is determined as a part of constructing your financial aid award letter. The maximum loan you may receive is usually around $3,000. Schools generally reserve Perkins funding for those students with the most financial need. However, typically, Perkins loans are more commonly given in the $1,000 to $1,500 range. In any event, the amount you receive will be determined by your school.
Many schools give Perkins for the first two years of study to augment your ability to borrow. This is because the maximum Stafford loan a student can take as a freshman is $3,500 and, as a sophomore, $4,500. Perkins funding can be renewed through the junior and senior years of study (in fact some graduate students may receive Perkins), but due to the limited availability of funding for this program, it is not likely for a student to receive it after the sophomore year. It isn’t all bad, though because in the junior and senior years, the maximum Stafford loan jumps to $5,500.