Federal Perkins

The ever increasing costs of post secondary education are causing many students to defer their (tertiary) studies or not undertake them at all. This is leading to shortages in many professions including teaching (particularly maths and science), nursing, Specialist medical and a vast growing number of other professions.

Typically a student in financial hardship would need to seek financial assistance through Financial Institutions in personal loans. However these loans usually attract very high interest rates and have set terms for repayment which could incur huge costs if the contract was to be varied in any way. However there are other options available to students who find themselves in severe financial hardship. One of these options is the Federal Perkins Loan.

What is a Federal Perkins Loan?

A Federal Perkins Loan is a loan which is available to undergraduates and graduates who find themselves in financial hardship. It is a low-interest loan attracting an interest rate of only 5%. It is a government funded program, although unlike the conventional loans, your school is the lender not a financial institution therefore the repayments are to be paid back to your school.

There are three factors which will determine a students borrowing capacity.

These include:

When you apply for the loan.
Your level of need.
Yours Schools funding Capacity.

The Schools will usually make the loan funds available to you in two instalments per academic year. The School will either directly credit your account or pay you directly, usually by cheque.

There are no fees associated with these loans, with the exception of interest charges, although non payment,late payments and partial payments may attract charges. Default on the loan may also incur collection cost fees.

The amount per year an undergraduate can borrow differs from that of a graduate. Undergraduates can borrow up to a maximum of $20,000.00. However the amount of $4,000.00 only per year of undergraduate study undertaken can be borrowed.

Graduates can borrow $6,000 for each year of graduate study undertaken. The total amount that Graduates can borrow is $40,000.00. This figure includes any Federal Perkins Loans which may have been borrowed whilst an undergraduate.

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For more thorough information and tips on Federal Perkins Loan be sure to visit our online debt consolidation web site available at Student Loan Consolidation.