PERKINS LOAN PROGRAM BEGINS WINDING DOWN

Congress did not extend the Perkins Loan Program beyond September 30, 2015. As a result, schools may not make Federal Perkins loans to new borrowers after September 30, 2015. Schools must follow the guidance provided in GEN-15-03, particularly as it relates to disbursements made on or after October 1, 2015 and the provisions about “grandfathered borrowers”. A school may make a new Perkins Loan to a student after September 30, 2015, if all of the following conditions are met:

  1. The school made at least one Perkins Loan disbursement to the student on or before June 30, 2015.
  2. The student is enrolled at the same institution where the last Perkins Loan disbursement was received. For example, a student who received a Perkins Loan disbursement for enrollment at School A, and then received a Perkins Loan disbursement for enrollment at School B would be considered to be an eligible grandfathered borrower at School B, provided all other conditions are met, but not for a subsequent enrollment at School A.
  3. The student is enrolled in the same academic program for which the student received his or her last Perkins Loan disbursement. We consider an academic program to be the same program only if the first four digits of the program’s Classification of Instructional Program (CIP) code are identical to the first four digits of the CIP code for the program for which the student received his or her last Perkins Loan disbursement.
  4. While the law provides for this limited “grandfathering” continued eligibility for Perkins Loans “as may be necessary to enable students . . . to continue or complete courses of study,” many of these grandfathered students could have their need met by a combination of other student aid and thus will not need a Perkins Loan to “enable [them]…to continue or complete [their] courses of study.” Therefore, a Perkins Loan can be made to an otherwise eligible grandfathered student to meet all or some of the student’s unmet need only after the student has been awarded all Direct Subsidized Loan aid for which the student is eligible.

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