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Description
Federal Perkins loans are low interest loans administered by McPherson College to students with exceptional need to help cover some of the immediate costs associated with graduate or undergraduate programs. Loans must be repaid including interest.   Recipients in 2015-16 received an average of $1000-$1500.

As of October 1, 2015, McPherson College is no longer authorized to disburse Perkins loans to new borrowers; however, students that have had a first disbursement of Perkins loan prior to June 30, 2015 may continue to receive additional disbursement through September 30, 2020 under certain conditions.

Forms and Procedures to Apply
To apply for the Federal Perkins loan, students must:

  • Apply to and be accepted to McPherson College
  • Submit a Free Application for Federal Student Aid (FAFSA) and receive a result known as the Expected Family Contribution (EFC).   The FAFSA is available at studentaid.gov/h/apply-for-aid/fafsa .   Students should make sure to include McPherson College’s FAFSA code 001933.
  • Complete Entrance Counseling at studentloans.gov and a paper Perkins Master Promissory Note (MPN)

Eligibility Requirements
To be eligible for Federal Perkins loans at McPherson College, students must:

  • Meet the general eligibility requirements as stated within the “Eligibility for Federal Student Financial Aid” section of the Consumer Information Page
  • Submit all forms for application
  • Be in good standing on previous educational loans

Criteria for recipient selection
To be considered for a Federal Perkins loan, students must:

  • Be enrolled full time in an undergraduate or graduate degree program
  • Show financial need after other forms of financial aid have been considered.
  • Utilize all subsidized Stafford loans first
  • Have had a first disbursement of Perkins before September 30, 2015

Criteria for award amount
The actual award amount in any given year will be determined by the following:

  • Need – Need for Perkins loans is determined with the following formula:
    Cost of Attendance – EFC – Other aid awards = Need.   Students must first borrow from the subsidized Stafford loan program before taking a Perkins loan.
  • Annual loan limit – Annual loan limits are the maximum amounts of loan funds that a student may receive during a given academic year.   Students are not generally awarded the full annual loan limit in the Federal Perkins loan program.   However, the chart below outlines the maximum annual loan limits in the Perkins loan program.
  • Aggregate loan limit – Aggregate Loan Limits are the maximum amount of loan funds that can be borrowed at any given time.   The chart below outlines the Aggregate loan limits in the Perkins loan program.
  • Degree Program – Students in graduate programs have different loan eligibility than undergraduate students.   The chart below outlines how the degree program affects the annual and aggregate loan limits.
Degree ProgramAnnual Loan LimitAggregate Loan Limit
Undergraduate$5,500$27,500
Graduate$8,000$60,000 Including all undergraduate amounts

For the 2015-16, recipients of the Federal Perkins loan averaged $1,000 to $1,500 for the year.

Terms and Conditions
Recipients of Federal Perkins loans agree to the following terms and conditions:

  • Students must accept loan amounts through Bulldog Connect or by Financial Aid Notification
  • Students must pay back their student loans, plus any accrued interest even if:
    • The student does not finish their degree
    • The student cannot find employment
    • The student is dissatisfied with their program of studyStudents that do not pay back their loans may go into default which can result in a negative result on credit scores, loss of future deferment eligibility, loss of eligibility for additional federal grants and loans, and garnishment of wages, tax returns and social security benefits.
  • Interest is fixed each year at 5%
  • Students are not required to repay any interest or principle amounts while they are attending at least half time in an eligible degree program, or for 9 months after ceasing enrollment or going below half time status.
    • The time that a student is not required to repay principle or accrued interest due to at least half time enrollment is called In-School Deferment
    • The 9 month timeframe after a student ceases to be enrolled or attends less than half time is called the Grace Period. Each loan has only one grace period.   Students that attend in non-consecutive terms may go directly into repayment on previous loans that have already exhausted their grace period.
  • Interest accrues on Federal Perkins loans at the point of disbursement; however, borrowers are only responsible for interest accrued after the 9 month grace period
  • New borrowers must complete entrance counseling and a Perkins Master Promissory Note
  • Student loans are reported to the National Student Loan Data System, for which borrowers may monitor their loan portfolio.   This information will also be accessible by lenders, servicers, guarantee agencies, and schools determined to be authorized users of the data system.
  • Students will be sent a disbursement notification from McPherson College detailing a number of loan details.   Students have a right to cancel their loans within 14 days of their disbursement notification.
  • Borrowers that graduate, withdraw, or begin attendance less than half time will be provided with exit counseling information. Exit Counseling reminds borrowers of their rights and responsibilities.   Information that may be collected during this process includes: name, address, telephone number, employer, if known, and 2 references with contact information.

Repayment Schedule
Prospective student borrowers may wish to estimate a monthly repayment schedule.   The following chart is provided for estimate purposes only.

Sample Repayment Schedule including Estimated Interest
Based on Standard 10 year repayment plan

4.29%5.00%5.84%6.84%
Loan AmountMinimum PaymentTotal InterestPrinciple plus InterestMinimum PaymentTotal InterestPrinciple plus InterestMinimum PaymentTotal InterestPrinciple plus InterestMinimum PaymentTotal InterestPrinciple plus Interest
$1,000*$50$40$1,040$50$47$1,047$50$55$1,055$50$65$1,065
$5,500$57$1,274$6,774$59$1,501$7,001$61$1,775$7,275$64$2,109$7,609
$10,000$103$2,316$12,316$107$2,728$12,728$111$3,227$13,227$116$3,835$13,835
$15,000$154$3,474$18,474$160$4,092$19,092$165$4,840$19,840$173$5,752$20,752
$20,000$206$4,631$24,631$213$5,456$25,456$221$6,453$26,453$231$7,669$27,669
$30,000$308$6,947$36,947$319$8,184$38,184$331$9,679$39,679$346$11,503$41,503
$40,000$411$9,262$49,262$425$10,912$50,912$441$12,905$52,905$462$15,338$55,338
$50,000$514$11,578$61,578$531$13,640$63,640$552$16,132$66,132$577$19,172$69,172
* At the minimum payment of $50 per month, this amount will be paid in 21-22 months

Current student borrowers may be able to estimate a monthly payment schedule using actual loan figures at studentloans.gov. To use this site:

  • Go to studentloans.gov
  • Log in using your FSA ID for best results, or
  • Select Managing Repayment without logging in to find a number of helpful tools relating to loan repayment including a repayment calculator

Repayment Plans
All student loans are set to a 10 year standard repayment plan. Borrowers may be eligible for other types of repayment plans.   Repayment plans outside of the standard often result in additional years of repayment and more interest paid over the life of the loan.   These plans however, may assist borrowers from going into default by offering lower monthly payments.   To view a synopsis of other repayment plans, students should:

  • Go to studentloans.gov
  • Hover over the tab entitled “How to Repay your Loans” until a drop down menu appears
  • In the dropdown menu, hover over “Understanding Repayment” until a secondary dropdown appears

In the secondary dropdown, select “Repayment Plans”

Criteria for continued eligibility
To continue receiving Perkins loans, students must:

  • Meet the Satisfactory Academic Progress requirements as explained in the college catalog each semester
  • Submit a new FAFSA each year