A Federal Perkins Loan is a low-interest (5%) loan for both undergraduate and graduate students with “exceptional” financial need.

Federal criteria include:

• Enrollment in an eligible school at least half-time in a degree program
• U.S. citizenship, permanent residency, or eligible noncitizen status
• Maintain satisfactory academic progress
• No unresolved defaults or overpayments owed on Title IV educational loans and grants
• Satisfaction of all Selective Service requirements

The U.S. Department of Education provides a programmed amount of funding to the school. In turn, the school determines which students have the greatest need. The school combines federal funds with some of its own funds for loans to qualifying students. To apply for this loan program, the student must complete the FAFSA.

Your school will pay you directly (usually by check) or apply your loan to your school charges. You'll receive the loan in at least two payments during the academic year.

Perkins loans share many of the characteristics of subsidized Stafford loans. The most notable differences are no fees and a longer grace period.

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