What is a Federal Perkins Loan?
A Federal Perkins Loan is a low-interest (5 percent) loan, which may be used only for educational purposes at Marywood University, and MUST BE REPAID! The grace period is nine months for Perkins Loan borrowers. This loan is made through Marywood University's Financial Aid Office, and acceptance of this loan does not affect your eligibility for other student financial aid. Marywood University is your lender and will hold the original promissory note until the debt is satisfied.
Payments will begin on the first day of the third month after the original grace period has expired after graduating, leaving school, or dropping below half-time enrollment. Minimum quarterly payments are $120.00 for Perkins Loan borrowers and the time allowed to repay the total loan is ten (10) years, but may be extended under certain circumstances. Therefore, smaller loans will be repaid in less than ten (10) years, and larger loans will result in quarterly payments higher than $120.00. If the entire Principal is paid before the grace period expires, no interest will be due. Once the loan is in repayment, the entire Principal and Interest may be repaid at any time without penalty. For information on loan consolidation, contact Marywood University's Cashier's Office.
What Amounts Can I Borrow?
You may borrow up to $5,500.00 annually ($27,500.00 aggregate), if you are an undergraduate student. This total includes any amount you borrowed under the Federal Perkins Loan Program, or under the National Direct Student Loan Program.
Can My Federal Perkins Loan Be Cancelled?
Upon making a properly documented writtem request to the school, your loan will be cancelled in the event of your death. If it is determined you are totally and permanently disabled, your loan will be placed in a conditional discharge status for three years before the Department of Education will determine if a final discharge will be granted.
Loans advanced to first-time borrowers prior to July 23, 1992 may be eligible for cancellations for each complete academic year you are a full-time teacher of handicapped children, or for each complete academic year you teach full-time in a designated elementary or secondary school that serves low-income families. For this teaching service you are entitled to have up to 100% of your loan cancelled at the following rates: 15% for the first and second complete academic years, 20% for the third and fourth complete academic years, and 30% for the fifth complete academic year. To find out whether the school you are teaching in is a designated school, contact Marywood University.
Loans advanced to first-time borrowers on or after July 23, 1992 may be eligible for cancellations for each complete academic year you are a:
- Full-time special education teacher, including teachers of infants, toddlers, children, or youth with disabilities in a public or other non-profit elementary or secondary school system, or as a full-time qualified professional provider of early intervention services in a public or other non-profit program under public supervision by the lead agency as authorized in section 676(b) (9) of the Individuals with Disabilities Education Act.
- Full-time teacher of mathematics, science, foreign languages, bilingual education, and other shortage fields determined by the state's education agency.
Part of your loan will be cancelled at the rate of 15% for each complete school year as a full-time staff member in specified Head Start programs. After the seventh year, your entire loan will have been cancelled. This cancellation applies to all loans advanced to borrowers.
Borrower can receive cancellation for each 12-month period of service as a member of the Armed Forces of the United States serving in an area of hostilities that qualifies for special pay under section 310 of Title 37 of the United States Code. For any year of service beginning on or after August 14, 2008, 100% cancellation can occur over 5 years. For any year of service beginning prior to August 14, 2008, 50% maximum cancellation over four years at the rate of 12½ % of the total principal amount plus interest on the unpaid balance for each complete year of such service.
Peace Corps/Action Programs
Up to 70% of your loan can be cancelled for service as a volunteer under The Peace Corps Act, or as a volunteer under The Domestic Volunteer Act of 1973 (ACTION programs). For each complete year of service under the Volunteer Service Cancellation provision, a portion of your loan will be cancelled at the rate of 15% of the original principal loan amount for the first and second 12-month period of service, and 20% of the original principal loan amount for the third and fourth 12-month period of service. This cancellation applies to NDSL and Perkins Loan borrowers.
Part of your loan will be cancelled for each full year of employment as a:
Full-time law enforcement officer for a local, state, or federal law enforcement agency. Full-time corrections officer for a local, state, or federal agency. This cancellation applies to awards signed for after November 29, 1990. To qualify, you must be employed for 12 continuous months by a publicly-funded local, state, or federal agency engaged in crime prevention or law enforcement including police departments, criminal courts, correction, probation and parole authorities. You must be a sworn officer or a person whose principal responsibilities are essential to the criminal justice system. Persons whose official responsibilities are supportive, such as office procedures, accounting, building maintenance, are not eligible.
Full-time nurse or medical technician providing health care services.
Full-time employee of public or private non-profit child care or family service agencies who are providing or supervising the provision of services to high-risk children who are from low-income communities and the families of such children. Eligible borrowers may receive 100% cancellation at the following rates: 15% for each of the first and second years, 20% for each of the third and fourth years, and 30% for the fifth year.
Providers of early intervention services which are developmental services designed to meet a handicapped infant's or toddler's needs.
Public Defender, Speech/Language Pathologist, Firefighter, Librarian, Tribal Faculty.
Can I Defer Repayment of My Federal Perkins Loan after I Leave School?
Deferments are NOT automatic. Effective July 1, 2002, deferment requests no longer need to be in writing. However, as in the past, the borrower is still responsible for providing enrollment verification from the school where the borrower is currently enrolled as at least a half-time student. Even though you may have applied for a deferment, you still must continue to make payments until your deferment is processed. Otherwise, you may default* on your loan. (* Default: failure to repay a student loan or by not complying with other terms agreed to when you signed a promissory note.) As long as you are not in default, you may defer repayment under the following conditions:
Loans Made after July 1, 1993 :
- While enrolled and in attendance as at least a half-time student at an institution of higher education.
- Borrowers pursuing a rehabilitation training program for disabled individuals, excluding medical internship or residency.
- Students engaged in graduate fellowship, until the completion of the period of the fellowship (includes fellowship outside the U.S.).
- Up to three years which borrower is seeking and unable to find full-time employment.
- Up to three years for economic hardship defined pursuant to regulations by the Secretary.
- Effective July 1, 2001, up to three years during which borrower is serving on active duty during a war or other military operation or national emergency, or performing qualifying National Guard duty during a war or other military operation or national emegency.
Loans Made before July 1, 1993 :
- While enrolled and in attendance as at least a half-time student at an institution of higher education.
- For a period of three years during which I am: (a) a volunteer in the Peace Corps or ACTION Programs or comparable full-time volunteer work for a tax-exempt organization; (b) a full-time active duty member of the U.S. Armed Forces or service in the Commissioned Corps of U.S. Public Health Service; or (c) a full-time member of the National Oceanic and Atmospheric Administration Corps. This deferment (c) applies to funds advanced on or after July 1, 1987. 3.
- For a period of three years during which I am temporarily totally disabled as established by an affidavit of a qualified physician, or unable to secure employment because you are caring for a temporarily totally disabled spouse or other dependent. Spouse or other dependent deferment applies to funds advanced on or after July 1, 1987.
- For a period not exceeding two years during which time I am serving in a required internship.
- Marywood University may, upon receipt of a written request, defer scheduled repayments if it is determined that the deferment is necessary to avoid financial hardship. Interest, however, may continue to accrue, and late charges will be assessed on all Federal Perkins Loans.
- Effective July 1, 2001, up to three years during which borrower is serving on active duty during a war or other military operation or national emergency, or performing qualifying National Guard duty during a war or other military operation or national emergency.
If a borrower's annual Title IV loan repayment obligation equals or exceeds 20 percent of the borrower's gross income, on receipt of a properly documented written request, an institution must grant a borrower forbearance of principal and interest or principal only as requested, renewable at 12-month intervals, not to exceed three years. Forbearance may also be granted if the institution determines that the borrower should qualify for other reasons. This applies to all loans. All borrowers requesting a forbearance will be required to pay all past-due interest and late charges prior to receiving hardship benefits.
Once you leave the lending institution, you may be eligible for periods of deferment during which interest does not accrue and repayment of principal is not required. A request for deferment does not need to be in writing, but the school may require that supporting documnetation is submitted to prove eligibility for a deferment.
If you are serving as a volunteer in the Peace Corps, you are eligible for an economic hardship deferment for your full term of service. An economic hardship deferment based on service as a Peace Corps volunteer may not exceed the lesser of three years or your remaining period of economic hardship eligibility. Contact Marywood University for the proper Cancellation and Deferment forms and procedures to be followed.
Additional eligibility requirements and definitions mey be found on the University Accounting Service link: https://www.uaservice.com/Borrower-Student/Deferment_eligibility.html
U.S. Army Loan Repayment Program
Although it is not a deferment, the U.S. Army offers a loan repayment program as an enlistment incentive. If a Perkins/NDSL borrower serves as an enlisted person in the U.S. Army, in the Army Reserves, or in the Army National Guard, the Department of Defense will repay a portion of the loan (not including interest). For more information, contact your commanding officer or your local Army recruiting office. This is a recruitment program and does not pertain to an individual's prior service.
What Happens If I Don't Pay Back My Loan?
You will go into default. If you do, Marywood University can require you to repay the entire amount immediately, including all interest, collection and late charges. Marywood University can sue you to collect that amount, and ask the Federal Government to take action against you to recover this money. Marywood University and the Federal Government will notify credit bureaus of your default, which will affect your future credit rating. For example, you may find it difficult to obtain a car loan. Also, the Internal Revenue Service may withhold your income tax refund and apply it toward your loan. And if you should return to school, you can't get additional Federal student aid.
There is a Loan Rehabilitation Program available through Marywood University should your loan reach a defaulted status. Contact the Cashier's Office for the details.
What Are My Rights and Responsibilities as a Borrower?
The Federal Perkins Loan, which has been approved for you by Marywood University, is a serious legal obligation. It is extremely important that you understand your rights and responsibilities. Unless you agree to comply with and to honor the terms and conditions of your Promissory Note, you should not accept the loan.
- I understand that I must sign a Master Promissory Note (MPN) when I receive my initial loan advance. This note is valid for ten years from the date I sign the MPN.
- I understand that I have the option of signing a new MPN for each advance. I must notify Marywood University in writing that I want to close one MPN and open a new MPN.
- I understand that I must immediately, without exception, report any of the following changes to the Perkins Loan Assistant, Marywood University, Cashier's Office, 2300 Adams Avenue, Scranton, PA 18509. Phone (570) 348-6212. FAX (570) 961-4739.
- If I withdraw from school;
- If I transfer to another school;
- If I drop below half-time status, (six credits);
- If my name should change;
- If my address or parent's address changes;
- If my Social Security Number changes.
- I understand that when I graduate, withdraw, or cease being at least a half-time student, I must arrange for an exit interview by contacting the Cashier's Office, Marywood University.
- I understand that payments will be due on the first day of the third month after the original grace period has expired after graduation, leaving school, or dropping below half-time status, and should be sent directly to Marywood University, Cashier's Office, or its designated billing agent.
- I understand that my minimum quarterly principal payment will be at least $90.00/$120.00 and that it may be more if the amount borrowed is sufficient to require larger payments. I also understand that all payments will be applied first to collection costs, late charges, accrued interest, and then to the principal balance of my loan.
- I understand that the annual percentage rate of 5% will be the finance charge based on the unpaid balance and that it will begin to accrue at the end of the grace period.
- I understand that I may request loan cancellation if I meet the eligibility criteria contained in the terms and conditions of my Promissory Note. It is my responsibility to inform Marywood University of such status or to make scheduled payments when due. I further understand that cancellation will not be granted until I provide Marywood University with the completed Request for Postponement or Request for Partial Cancellation of Loan form bearing my signature and certification of the information by the proper institution or organization.
- I understand that if I become eligible for any deferment benefits provided in the terms and conditions of my Promissory Note, I must request that the payments on my loan be deferred or I must make scheduled payments when due. I further understand that deferment will not be granted until I provide Marywood University with a completed Request for Deferment form, (in situations where such a form is required), bearing my signature and proper certification of the information by the proper institution or organization.
- I understand that if I should default on my loan, I will be ineligible for further Title IV Funds and that the University may withhold future services. I understand that if I fail to make scheduled payments when due, the entire unpaid indebtedness including late charges, collection costs, and accrued interest, may be due immediately, at the option of the institution. I understand that the institution will utilize a collection agency and/or litigation to recover the outstanding debt, and I agree to pay all late charges, collection costs and attorney fees related to the collection of this loan in the event of default. I further understand if my loan remains in default it may be assigned to the U.S. Government for collection.
- I understand that I may without penalty repay all or any part of my loan at any time, and, that future interest will be reduced by making such payments.
- I understand that if I cannot make payments on time, I must contact the Perkins Loan Assistant, Marywood University, Cashier's Office to make payment arrangements.
- I agree to promptly answer any communication from Marywood University regarding the loan.
- I understand that effective July 23, 1992, Marywood University must report all loan advances in addition to defaulted loans to credit bureaus as required by Federal regulations.
- I authorize Marywood University to contact any school which I may attend, to obtain information concerning my student status, my year of study, my dates of attendance, graduation, or withdrawal, my transfer to another school, or my current address.
- I understand that I am obligated to repay the full loan even if I don't finish the program at Marywood, can't get a job after graduating, or am dissatisfied with the school's educational programs or other services.
Student Loan Ombudsman
If you dispute the terms of your NDSL or Federal Perkins Loan in writing and the holder of your loan is unable to resolve the dispute, you may seek the assistance of the Department of Education's Student Loan Ombudsman. The Student Loan Ombudsman will review and attempt to informally resolve your dispute and may be reached at 1-877-557-2575.
If you have any questions about the terms of your Perkins Loan, repayment obligations, deferment, cancellation, or loan consolidation, contact Wendy Mitchell, Perkins Loan Assistant, Marywood University, Cashier's Office at (570) 348-6212. E-mail: firstname.lastname@example.org. Remember, only Marywood University can grant deferments or cancellations, or make decisions concerning your loan. Our billing agent is University Accounting Service, LLC (UAS), P.O. Box 932, Brookfield, WI 53008. Their toll-free number is 1-800-999-6227.