FEDERAL SCHOOL CODE: 002629
FEDERAL PERKINS LOAN TERMS AND CONDITIONS
APPLICABLE LAW - The terms of this Federal Perkins Loan Promissory Note
(hereinafter called the Note) and any disbursements made under this Note shall
be interpreted in accordance with Part E of Title IV of the Higher Education
Act of 1965, as amended (hereinafter called the Act), as well as Federal regulations
issued under the Act. All sums advanced under this Note are subject to the Act and Federal
regulations issued under the Act.
REPAYMENT - I am obligated to repay the principal and the interest that accrues
on my loan(s) to the above-named institution (hereinafter called the School) over a period
beginning 9 months (or sooner if I am a Less-Than-Half-Time Borrower) after the date I cease
to be at least a half-time student at an institution of higher education or a comparable school
outside the United States approved by the United States Department of Education (hereinafter
called the Department) and ending 10 years later, unless I request in writing that my repayment
period begin sooner. I understand that the School will report the amount of my installment
payments, along with the amount of this loan to at least one national credit bureau. Interest
on this loan shall accrue from the beginning of the repayment period. My repayment period may
be shorter than 10 years if I am required by my School to make minimum monthly payments. My
repayment period may be extended during periods of deferment, hardship, or forbearance and I
may make graduated installments in accordance with a schedule approved by the Department. I will
make my installment payments in equal monthly, bimonthly or quarterly installments as determined
by the School. The School may round my installment payment to the next highest multiple of $5.
I will make a minimum monthly payment of $40 (or $30 if I have outstanding Federal Perkins Loans
made before October 1, 1992 that included the $30 minimum payment option) in accordance with the
Minimum Monthly Payment Section of the Terms and Conditions contained on the reverse side of this
LATE CHARGES - The School will impose late charges if I do not make a scheduled payment when
due or if I fail to submit to the School on or before the due date of the payment, a properly
documented request for any of the forbearance, deferment or cancellation benefits as described
below. No late charges may exceed 20 percent of my monthly, bimonthly, or quarterly payment.
The School may add the late charges to principal the day after the scheduled payment was due
or include it with the next scheduled payment after I have received notice of the charge, and
such notice is sent before the next installment is due.
FORBEARANCE, DEFERMENT, OR CANCELLATION – I may apply for a forbearance, deferment,
or cancellation on my loan. During an approved forbearance period, payments of principal and
interest, or principal only, may be postponed or reduced. Interest continues to accrue while
my loan is in forbearance. During an approved deferment period, I am not required to make
scheduled installment payments on my loan. I am not liable for any interest that might
otherwise accrue while my loan is in deferment. If I meet the eligibility requirements for
a cancellation of my loan, the institution may cancel up to 100 percent of the outstanding
principal loan amount. Information on eligibility and application requirements for forbearances,
deferments, and cancellations is provided on pages 2 and 3 of this Note. I am responsible for
submitting the appropriate requests on time, and I may lose my benefits if I fail to file my
request on time.
DEFAULT – The School may, at its option, declare my loan to be in default if (1) I fail
to make a scheduled payment when due; (2) I fail to submit to the School, on or before the due
date of a scheduled payment, documentation that I qualify for a forbearance, deferment, or
cancellation; or (3) I fail to comply with the terms and conditions of this promissory Note or
written repayment agreement.
The School may assign a defaulted loan to the Department for collection. I will be ineligible
for any further federal student financial assistance authorized under the Act until I make
arrangements that are satisfactory to the School or the Department to repay my loan. The
School or the Department shall disclose to credit bureau organizations that I have defaulted
and all other relevant loan information. I will lose my right to defer payments and my right
to forbearance if I default on my loan. The School or the Department may accelerate my
defaulted loan. Acceleration means that the School or the Department demands immediate payment
of the entire unpaid balance of the loan, including principal, interest, late charges, and
collection costs. I will lose my right to receive cancellation benefits for service that is
performed after the date the School or the Department accelerated the loan.
CHANGE OF STATUS - I will inform the School of any change in my name, address, telephone
number, Social Security Number, or driver's license number.
PROMISE TO PAY: I promise to pay the School, or a subsequent holder of the Promissory Note,
the sum of amount(s) advanced to me under the terms of this Note, plus interest and other fees
which may become due as provided in this Note. I promise to pay all reasonable collection costs,
including attorney fees and other charges, necessary for the collection of any amount not paid
when due. I will not sign this Note before reading it, including the provisions on pages 2 and
3 of this Note. This loan has been made to me without security or endorsement. My signature
certifies I have read, understand, and agree to the terms and conditions of this Promissory Note.
I UNDERSTAND THAT I AM RECEIVING A LOAN THAT MUST BE REPAID.
LOAN REHABILITATION - If I default on my Federal Perkins Loan, I may rehabilitate my
defaulted loan by requesting the rehabilitation and by making a voluntary, on-time, monthly
payment, as determined by the School, each month for twelve consecutive months. If I
successfully rehabilitate my defaulted Federal Perkins Loan, I will again be subject to the
terms and conditions and qualify for any remaining benefits and privileges of my original
Promissory Note and the default will be removed from my credit history. I understand that I
may rehabilitate a defaulted Federal Perkins loan only once. After my loan is rehabilitated,
collection costs on the loan may not exceed 24 percent of the unpaid principal and accrued interest
as of the date following the application of the twelfth consecutive payment. If I default on my
rehabilitated loan, the cap on collection costs is removed.
ASSIGNMENT - This Note may be assigned by the School only to the United States, as
represented by the United States Department of Education. Upon assignment, the provisions of
this Note that relate to the School will, where appropriate, relate to the Department.
HARDSHIP REPAYMENT OPTIONS - Upon my written request, the School may extend my repayment
period (1) for up to an additional 10 years if I qualify as a low-income individual during the
repayment period; or (2) for the period necessary beyond my 10-year repayment period if, in the
school’s opinion, prolonged illness or unemployment prevent me from making the scheduled
repayments. Interest will continue to accrue during any extension of a repayment
If I am required by the School to make a minimum monthly payment on my loan, the School may
also permit me to pay less than the minimum monthly payment amount for a period of not more
than one year at a time if I experience a period of prolonged illness or unemployment, however,
such action may not extend the repayment period beyond 10 years.
GRACE PERIODS - Unless I am a Less-Than-Half-Time Borrower, I will receive an initial
nine-month grace period before the first payment of my Federal Perkins Loan must be made.
After the close of an authorized deferment period, I will receive a post-deferment grace
period of 6 months before my payments resume. Interest does not accrue during the initial
grace period or during a post-deferment grace period. The nine-month initial grace period
for Federal Perkins Loans does not include any period up to 3 years during which I am called
or ordered to active duty for more than 30 days from a reserve component of the Armed Forces
of the United States, including the period necessary for me to resume enrollment at the next
available enrollment period. I must notify the School that made my loan of the beginning and
ending dates of my service, and the date I resume enrollment. If I am in my initial grace period
when called or ordered to active duty, I am entitled to a new nine-month initial grace period
upon completion of the excluded period.
If I am a Less-Than-Half-Time Borrower with outstanding Federal Perkins Loans, my repayment
period begins when the next scheduled installment of my outstanding loan is due. If I am a
Less-Than-Half-Time Borrower with no other outstanding Federal Perkins Loans, my repayment
begins the earlier of: 9 months from the date my loan was made, or 9 months from the date I
became less than a half-time student, even if I received the loan after I became a less than
PREPAYMENT - I may prepay all or any part of my unpaid loan balance, plus any accrued
interest, at any time without penalty. Amounts I repay in the academic year in which the loan
was made and before the initial grace period has ended will be used to reduce the amount of
the loan and will not be considered a prepayment. If I repay amounts during the academic year
in which the loan was made and the initial grace period has ended, only those amounts in excess
of the amount due for any repayment period shall be considered a prepayment. If, in an
academic year other than the award year in which the loan was made, I repay more than the
amount due for an installment, the excess will be used to repay principal unless I designate
it as an advance payment of the next regular installment.
MINIMUM MONTHLY PAYMENT - If required by the School, I will make a minimum monthly payment
amount of $40 (or $30 if I have outstanding Federal Perkins Loans made before October 1, 1992
that included the $30 minimum payment option) or its bimonthly or quarterly equivalent. If the
total monthly payment amount on this loan and any outstanding Federal Perkins Loans I may have
is less than the minimum monthly payment amount established by the School, the School may still
require a minimum monthly payment amount. A minimum monthly payment amount will combine my
obligation on this and all my outstanding Federal Perkins Loans unless I have received loans
with different grace periods and deferments. At my request and if I am eligible, the school
may combine this minimum monthly payment amount with all my outstanding Federal Perkins Loans,
including those made at other schools. Under these circumstances the portion of the minimum
monthly payment that will be applied to this loan will be the difference between the minimum
monthly payment amount and the total amounts owed on a monthly basis on my other Federal
Perkins Loans. If each school holding my outstanding Federal Perkins Loans exercises the
minimum monthly payment amount option, the minimum monthly payment amount will be divided
among the schools in proportion to the loan amount advanced by each school.
FORBEARANCE - Upon making a properly documented written request to the School, I am
entitled to forbearance of principal and interest or principal only, renewable at intervals of up
to 12 months for periods that collectively do not exceed three years, under the following
conditions: If my monthly Title IV loan debt burden equals or exceeds 20 percent of my total
monthly gross income; if the Secretary authorizes a period of forbearance due to a national
military mobilization or other national emergency; or if the School determines that I qualify
due to poor health or for other reasons, including service in AmeriCorps. Interest accrues
during any period of forbearance.
DEFERMENTS - To apply for a deferment, I must request the deferment from the School.
My request does not have to be in writing, but the School may require that I submit supporting
documentation to prove my eligibility for a deferment. I may defer making scheduled installment
payments and will not be liable for any interest that might otherwise accrue 1) during any
period that I am enrolled and attending as a regular student in at least a half-time course of
study at an eligible school (If the School obtains student enrollment information showing that
I qualify for this deferment, the School may grant the deferment without my request providing
the School notifies me and gives me the option to cancel the deferment); 2) during any period
that I am enrolled and attending as a regular student in a graduate fellowship program approved
by the Secretary; engaged in graduate or post-graduate fellowship-supported study outside the US;
enrolled and attending a rehabilitation training program for disabled individuals approved by the
Secretary; engaged in public service that qualifies me to have part or all of my loan canceled;
3) for a period not to exceed three years during which I am seeking but unable to find full-time
employment; and 4) for a period not to exceed three years, for up to one year at a time, during
which I am experiencing an economic hardship as determined by the School. I may qualify for an
economic hardship deferment for my Federal Perkins Loan if I provide my school with documentation
showing that I have been granted an economic hardship deferment under the William D. Ford Federal
Direct Loan Program or Federal Family Education Loan Program for the period of time for which I
am requesting an economic hardship deferment for my Federal Perkins Loan. If I am serving as a
volunteer in the Peace Corps, I am eligible for an economic hardship deferment for my full term
of service; however, I understand that an economic hardship deferment based on service as a Peace
Corps volunteer may not exceed the lesser of three years or my remaining period of economic
I may continue to defer making scheduled installment payments and will not be liable for any
interest that might otherwise accrue for a six-month period immediately following the expiration
of any deferment period described in this paragraph.
I am not eligible for a deferment while serving in a medical internship or residency
CANCELLATIONS - Upon making a properly documented written request to the School, I am
entitled to have up to 100 percent of the original principal loan amount of this loan canceled
if I perform qualifying service in the areas listed in paragraphs A, B, C, D and E below.
Qualifying service must be performed after I receive the loan.
A. Teaching · a full time teacher in a public or other nonprofit elementary or secondary school,
designated by the Secretary in accordance with the provisions of section 465(a)(2) of the Act
as a school with a high concentration of students from low-income families. An official
Directory of designated low-income schools is published annually by the Secretary; · a
full-time special education teacher in a public or nonprofit elementary or secondary school
system; or · a full-time teacher, in a public or other nonprofit elementary or secondary
school system, who teaches mathematics, science, foreign languages, bilingual education, or
any other field of expertise that is determined by the State Department of Education to have
a shortage of qualified teachers in that State.
B. Early Intervention Services · a full-time qualified professional provider of early
intervention services in a public or other nonprofit program under public supervision by a
lead agency as authorized by section 632(5) of the Individuals with Disabilities Education
Act. Early intervention services are provided to infants and toddlers with
C. Law Enforcement or Corrections Officer · a full-time law enforcement officer for an eligible
local, State or Federal law enforcement agency; or · a full-time corrections officer for an
eligible local, State, or Federal corrections agency.
D. Nurse or Medical Technician · a full-time nurse providing health care services; or · a
full-time medical technician providing health care services.
E. Child or Family Service Agency · a full-time employee of an eligible public or private
non-profit child or family service agency who is providing or supervising the provision of
services to high-risk children who are from low-income communities and the families of such
Cancellation Rates - For each completed year of service under paragraphs A, B, C, D, and E
a portion of this loan will be canceled at the following rates:
- 15 percent of the original principal loan amount for each of the first and second years;
- 20 percent of the original principal loan amount for each of the third year and fourth years; and
- 30 percent of the original principal loan amount for the fifth year.
F. Head Start Cancellation - Upon making a properly documented written request to the
School, I am entitled to have up to 100 percent of the original principal loan amount canceled
for qualifying service performed after I receive the loan as: · a full-time staff member in the
educational component of a Head Start program which is operated for a period comparable to a
full school year and which pays a salary comparable to an employee of a local educational
Cancellation Rate - For each completed year of service under the Head Start Cancellation
provision, this loan will be canceled at the rate of 15 percent of the original principal
G. Military Cancellation - Upon making a properly documented written request to the School,
I am entitled to have up to 50 percent of the principal amount of this loan canceled for qualifying
service performed after I receive the loan as: · a member of the Armed Forces of the United States in
an area of hostilities that qualifies for special pay under section 310 of Title 37 of the United
Cancellation Rate - For each completed year of service under the Military Cancellation
provision, this loan will be canceled at the rate of 12½ percent of the original principal loan
H. Volunteer Service Cancellation - Upon making a properly documented written request to the
School, I am entitled to have up to 70 percent of the original principal loan amount of this
loan canceled for qualifying service performed after I received the loan as: · a volunteer
under the Peace Corps Act; · a volunteer under the Domestic Volunteer Service Act of 1973
Cancellation Rate - For each completed year of service under the Volunteer Service
Cancellation provision, a portion of this loan will be canceled at the following rates:
- 15 percent of the original principal loan amount for each of the first and second 12-month periods of service; and
- 20 percent of the original principal loan amount for each of the third and fourth 12- month periods of service.
DISCHARGES – My obligation to repay this loan may be partially or totally discharged
for the reasons specified in paragraphs A, B, C, and D below.
A. Death - In the event of my death, the School will discharge the total amount owed on this
B. Total and Permanent Disability - If I become totally and permanently disabled after I receive
this loan, the School will discharge the total amount owed on this loan. If my disability
discharge claim is approved by the School on or after July 1, 2002, this loan will be assigned
to the United States Department of Education, which will discharge the total amount owed on
this loan if it determines that I am eligible for a total and permanent disability
C. School Closure - Under certain conditions, my total liability will be discharged,
including refunding any amounts I have already paid on the loan, if I was unable to complete
the program in which I was enrolled because my school closed.
D. Bankruptcy - Under certain conditions, my loan may be discharged in bankruptcy. In order
to discharge a loan in bankruptcy, I must prove undue hardship in an adversary proceeding
before the bankruptcy court.
Disclosure of Information
STUDENT LOAN OMBUDSMAN – If I dispute the terms of my Federal Perkins Loan in writing
to my School, and my School and I are unable to resolve the dispute, I may seek the assistance of
the Department of Education’s Student Loan Ombudsman. The Student Loan Ombudsman will review and
attempt to informally resolve the dispute.