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Perkins Loan Forgiveness: Everything You Need To Know

Perkins loan forgiveness

In 2020, student loan debt has risen to about $1.56 trillion. The latest statistics show how serious the student loan debt has become for borrowers across any demographics and age groups. It’s not surprising that it is the second-highest in consumer debt, and Perkins loan forgiveness isn’t any different. According to Forbes, there are two million Perkins loan borrowers. That’s massive!

What is a loan? Why did it expire? If you’re looking for more information about your Perkins loan forgiveness, search no further. In this article, we’ll take a comprehensive look at what is a Perkins loan and also, everything concerning the Perkins loan program.

What Is A Perkins Loan?

The Perkins loan offers a 5% low-interest loans for graduates and undergraduate student borrowers having an outstanding financial need. The Perkins loan is different from other federal student loan forgiveness programs; your school lends the Perkins Loans; thus, if they’re certified. It means to get a Perkins loan program; you’ll have to work with your school directly to repay your loan. Sometimes, the school hires a company to repay the Perkins loan to students.

 Limitations On Perkins Loan

Perkins loan forgivenessBefore the federal government defunded the Perkins loan program (more on that later), students could borrow $5,500 with a maximum limit of $27,500 per year. Professional students who were enrolling in post-secondary education, the annual limit increased to $8,000 with a maximum limit of $60,000. Undergraduate loans were also included.

A financial help administrator determines the annual loan amount at the financial aid office at your school. For you to receive the loan, it’ll depend on other federal student aid you get during the academic year.

The Government Cancelled The Perkins Loan Program

The federal government canceled the program because of budgetary issues. The purpose of the Perkins loan program was to provide an outstanding financial need for students. Even though the Perkins loans program was available for about one percent of all students who borrowed, it helped thousands of students to get out of debt.

Now, according to the National Association of Student Financial Administrators, 528,000 benefited from the program in the 2014-15 academic year. The average amount was $2,198.

In 2015, the purpose of the Federal Perkins Loan Program Extension Act was to eliminate the Perkins loan in two years. The idea was that Congress would overhaul the whole student loan system before they ended it. But somehow, they allowed the Perkins Loan program to expire in 2017. Currently, lawmakers are working to make a replacement.

Perkins Loan Program Repayment Options

The repayment options for Perkins loans are not the same as other federal student loans, such as Direct Loan or FFEL programs. You’re not even qualified for any income-driven repayment opportunities. That means when you fall below the half-time enrollment nine months before you get your bill, you’ll get at least a $40 monthly payment.

Let’s recap on the repayment plans to get a better understanding.

Your loan will be in a grace period for nine months after you fall below the half-time enrollment. But, the school you enrolled in can extend the repayment up to ten years, especially if you are a low-income individual. A low-income individual is someone whose income falls below 150 percent of the poverty line.

There’s, however, good news. If you want to use the income-driven repayment plan, you can consolidate your Perkins loan into a Direct Loan. The student loan consolidation can be beneficial if your loan forgiveness is under the Public Service Loan Forgiveness program.

Perkins Loan Forgiveness For Teachers

The Perkins Loan program was the first program that offered loan forgiveness for teachers. For teachers to be eligible, you have to work in a low-income district schools, mainly, Title I schools. But more precisely, the teachers:

  • Will have to work full-time
  • Work in a selected secondary or elementary school
  • Serve students who come from low-income families

Also, teachers can qualify if they are special education teachers working full time. That means teaching children with disabilities in non-profit or public elementary or secondary schools. In case you are a full-time teacher at a Tribal University or College, you can be eligible for the Perkins loan program. 

Lastly, teachers can qualify for the loan cancellation if they’re a full-time teacher of science, math, bilingual education, foreign languages, or other areas considered as shortage areas in need of teachers. 

The Perkins loan program covers teaching periods that began on August 14, 2008. Any loan debt before the date will not be eligible for loan cancellation.

Other Perkins Loan Forgiveness Opportunities Available

Perkins loan forgivenessIf you’re not a teacher, there are still opportunities for you to qualify for the Perkins loan program. You can be eligible if you’re a full-time:

  • A medical technician or a nurse
  • Peace Corps or Vista volunteer
  • Active duty military member in the armed forces in a hostile fire
  • Member in child-care program or pre-kindergarten, licensed by the state
  • Firefighter for a state, local or federal fire department
  • Speech pathologist with a certified master’s degree who works in elementary or secondary school
  • Librarian or serving in a public library of Title I schools
  • An attorney who is working in a community or public defender organization
  • An employee at a non-profit or federal family service agency, serving low-income families

You Can Be Eligible for the Perkins Loan Forgiveness Even In Default

In general, you have to perform a service with no interruptions for a specific period, usually from four to five years, before you can qualify for the Perkins loan forgiveness. If your loan has not accelerated, you can still be eligible to cancel your default loan. There’s still hope if your loan is accelerated.

How To Apply for The Perkins Loan Program

You can apply for the Perkins loan program through the school that holds your student loans. If you want to request for your Master Promissory Note, contact your school and request for it. There is no official form to ask for the promissory note for your Perkins loans. So you can submit your written request or do so orally. Either way, contact your school for more inquiries on how to go about it.

Time Limit Laid Down Before Teachers Before They Can Receive Their Benefits

It’s quite simple for teachers to receive their Perkins Loan program, as long as you are an eligible teacher. You can benefit from the program after one year of service. You can teach full-time for one academic year in full. But they’re no specific hours or days in a year to appropriate this condition. As long as the school deems you as having completed a full academic year, you can qualify for the Perkins loan program.


The US government phased out the Perkins loan forgiveness as a result of budgetary issues. However, teachers with Perkins loans can get 100 percent forgiveness if they teach in a low-income school for a full-time. You get forgiveness for your whole loan balance in five years. The great thing about the Perkins Loan program is that the cancellation is given in increments. That way, if you don’t reach the five years, you would have some of your loan debt forgiven.

Here’s a little breakdown:

  • In the first year, you get 15 percent forgiveness
  • In year two, you get 15 percent forgiveness
  • Year three, 20 percent forgiveness
  • In the fourth year, you get 40 percent forgiveness
  • Year five, you get 30% forgiveness

We’ve explained what a Perkins loan is and how teachers can get forgiveness from their Perkins loans. If you’re a teacher, the Perkins loan forgiveness program is the best way to pay off your student loan debt once and for all. So don’t waste any time. Get your load debt canceled right away!