Federal Perkins Loan (ended September 30, 2017)
Federal Perkins Loans was one part of the federal government's three Campus-based aid programs (Federal Work-Study and SEOG Grants are the others). The federal government gave colleges varying levels of Perkins Loan funds to spend within specific parameters. For this reason, some colleges had much more Federal Perkins Loan funds to award than other colleges. Elizabethtown College received a modest Perkins Loan allocation so the number and amounts of awards offered from this fund were limited. Perkins Loan awards were normally offered to the most needy students in the amount of $500 - $1,000 per year (for the freshmen and sophomore year). Below are specific details regarding this loan:
- Interest rate is fixed at 5%;
- No principal or interest payments due until 9 months after graduating or leaving school;
- Cancellation provisions exist for certain types of employment or service;
- $40 per month minimum repayment;
- Maximum 10 year repayment term.
It is important to remember Perkins Loan eligibility was based on financial need, so therefore not all students were eligible for the Perkins Loan. Students were notified of their eligibility for a Perkins Loan on their financial aid award letter.
Entrance and Exit Counseling
The federal government required that first-time Federal Perkins Loan borrowers participate in Entrance Counseling before receiving loan proceeds. Entrance Counseling is a method of educating the borrower as to the interest rate, repayment terms, disbursement procedures, and other details involved with the loans. Entrance Counseling is conducted by the College.
First-time Federal Perkins Loan borrowers, must complete Perkins Loan Entrance Counseling.
Along with Entrance Counseling, the federal government requires that all Federal Perkins Loan borrowers participate in Exit Counseling before they graduate, leave school, or fall below half-time enrollment. Exit Counseling serves to educate the borrower as to the interest rate, repayment terms, cumulative loan amounts, deferment and forbearance options, grace period, and other details involved with the loans. All Exit Counseling is conducted by the College. Students leaving the College before their anticipated graduation date must contact the Financial Aid Office to conduct Exit Counseling.
Accepting the Loan / Signing the MPN
Students awarded and accepted Federal Perkins Loans was sent a detailed packet of Perkins information during the summer. Students were to read, complete, sign, and return certain documents from this packet before the start of classes. For first time Perkins borrowers, included in this packet was the Master Promissory Note (MPN), which must also be signed and returned. The same promissory note was used in future years to reflect additional borrowing if the student maintains eligibility for the Federal Perkins Loan program. To view a sample Perkin's Loan Master Promissory Note, click here. Students can view a copy of the Perkin's Rights and Responsibilities here.
A typical Federal Perkins Loan borrower at Elizabethtown will incur between $1,000 - $2,000 of Perkins Loan indebtedness.