The Federal Perkins Loan Program is being reviewed for termination by the US Department of Education. Without additional legislative action, the final loans to be approved for new borrowers will be made on or before September 30th, 2017. As of January 31, 2016, our understanding is that renewal loans for pre-September 30, 2017 new borrowers can be made through September 30, 2020. There is not currently a Federal Student Loan Program option available that will provide student borrowers with dollars to replace what they may have received through the Perkins Loan Program.
Federal Perkins Loans are awarded to students with remaining financial need after their full annual eligibility for the Subsidized and Unsubsidized Federal Stafford Loan is considered. Although Perkins Loans have repayment and forgiveness options that are not the same as those available for Stafford Loans, both Perkins and Stafford Loans may become part of a Federal Direct Consolidation Loan along with Stafford Loans. Consolidating Perkins and Stafford Loans may result in a lower monthly payment and/or an extended amount of time to repay the underlying loans although a higher total amount of interest expense may be incurred due to the extended time to repay. Perkins Loan interest is fixed at 5%. This compares to the variable rate applied to Federal Stafford Loans which was 4.29% for undergraduate borrowers for the 2015-16 award year. For more information on Federal Perkins, Stafford, or Direct Consolidation Loans, visit studentloans.gov.