Federal Perkins Loan Information

The Federal Perkins Loan Program provides low-interest loans to help needy you finance the costs of postsecondary education. You can receive Perkins loans at any one of approximately 1,800 participating postsecondary institutions. Institutional financial aid administrators at participating institutions have a lot of flexibility in determining the amount of Perkins loans to award to students who are enrolled or accepted for enrollment. If you undertake certain public, military, or teaching service employment you may be eligible to have all or part of your loans canceled. In general, schools are reimbursed for 100 percent of the principal amount of the loan canceled, and the reimbursement must be reinvested in the school's revolving loan fund. These institutional reimbursements for loan cancellations are an entitlement.

Loan volume in the program comes from: (1) newly appropriated FCC contributions and loan cancellation payments; (2) an institutional matching contribution equaling at least one-third of the FCC contribution; and (3) school-level collections on prior-year student loans.

Financial need is determined by the U.S. Department of Education, using a standard formula, established by Congress, to evaluate the financial information reported by the student on the FAFSA. The information from the FAFSA then determines the student's expected family contribution (EFC). The fundamental elements in this standard formula are your income (and assets, if you are considered as independent), your parents' income and assets (if you are considered a dependent), the family's household size, and the number of family members (excluding parents) attending postsecondary institutions.

The EFC is the sum of: (1) a percentage of net income (remaining income after subtracting allowances for basic living expenses) and (2) a percentage of net assets (assets remaining after subtracting an asset protection allowance). Different assessment rates and allowances are used for dependent students, independent students without dependents, and independent students with dependents. After filing a FAFSA, the student receives a Student Aid Report (SAR) or the institution receives an Institutional Student Information Record (ISIR), which provides the student's EFC.