A Perkins Loan is a type of federal student loan based on financial need. It was a low-interest, subsidized federal student loan, meaning that the Department of Education paid the loans interest while the borrower was in school and during the grace period after leaving school. The program was part of the Federal Direct Student Loan Program and was offered by the U.S. Department of Education to assist American college students in funding their post-secondary education. The program was named after Carl D. Perkins, a former member of the U.S. House of Representatives from Kentucky.

Perkins Loans were granted through the financial aid office of the students educational institution with money paid either directly to the student or applied toward institutional charges. Unlike other federal loans, the school was the actual lender, and the loan was repaid to the school. Perkins Loans carried a fixed interest rate of 5% for the duration of the ten-year repayment period. The Perkins Loan Program had a nine-month grace period, so that borrowers began repayment in the tenth month upon graduating, falling below half-time status, or withdrawing from their college or university. Since the Perkins Loan was subsidized by the government, interest did not begin to accrue until the borrower began to repay the loan.

The Perkins Federal Loan Program ended in 2017. However, people who received a Perkins Loan are still required to pay those loans and are still eligible for the benefits of the Perkins Loan Program. Perkins loans must be repaid within ten years. Borrowers employed in a public-service-related job, such as a public school teacher or a nurse, may be eligible to have their loans canceled after a certain number of years of service. In certain circumstances, borrowers may be able to have their Perkins loans discharged, meaning that they no longer need to make payments on them. Those situations can include bankruptcy, death, and total and permanent disability.

If you are not sure if you have a Perkins loan, you can learn more about what type of loan you have through the U.S. Department of Educations Federal Student Aid website.