Omb No. 1845-0061 Form - Federal Perkins Loan Promissory Note (Page 2 of 4) in pdf

Terms and Conditions (cont.)

MINIMUM MONTHLY PAYMENT – If required by the School, I will

make a minimum monthly payment amount of $40 (or $30 if I have

LOAN REHABILITATION - If I default on my Federal Perkins Loan, I

outstanding Federal Perkins Loans made before October 1, 1992 that

may rehabilitate my defaulted loan by requesting the rehabilitation and by

included the $30 minimum payment option) or its bimonthly or quarterly

making a voluntary, on-time, monthly payment, as determined by the

equivalent. If the total monthly payment amount on this loan and any

School, each month for twelve consecutive months. If I successfully

outstanding Federal Perkins Loans I may have is less than the minimum

rehabilitate my defaulted Federal Perkins Loan, I will again be subject to the

monthly payment amount established by the School, the School may still

terms and conditions and qualify for any remaining benefits and privileges

require a minimum monthly payment amount. A minimum monthly

of my original Promissory Note and the default will be removed from my

payment amount will combine my obligation on this and all my outstanding

credit history. I understand that I may rehabilitate a defaulted Federal

Federal Perkins Loans, unless I have received loans with different grace

Perkins loan only once. After my loan is rehabilitated, collection costs on

periods and deferments. At my request and if I am eligible, the school may

the loan may not exceed 24 percent of the unpaid principal and accrued

combine this minimum monthly payment amount with all my outstanding

interest as of the date following the application of the twelfth consecutive

Federal Perkins Loans including those made at other schools. Under these

payment. If I default on my rehabilitated loan, the cap on collection costs is

circumstances the portions of the minimum monthly payment that will be

removed.

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

ASSIGNMENT - This Note may be assigned by the School only to the

other Federal Perki n s Loans. If each school holding my outstanding Federal

United States, as represented by the United States Department of Education.

Perkins Loans exercises the minimum monthly payment amount option, the

Upon assignment, the provisions of this Note that relate to the School will,

minimum monthly payment amount will be divided among the schools in

where appropriate, relate to the Department.

proportion to the loan amount advanced by each school.

HARDSHIP REPAYMENT OPTIONS - Upon my written request, the

FORBEARANCE - Upon making a properly documented written request

School may extend my repayment period (1) for up to an additional 10

to the School, I am entitled to forbearance of principal and interest or

years if I qualify as a low-income individual during the repayment period;

principal only, renewable at intervals of up to 12 months for periods that

or (2) for the period necessary beyond my 10 year repayment period if, in

collectively do not exceed three years, under the following conditions: If my

the School’s opinion, prolonged illness or unemployment prevent me from

monthly Title IV loan debt burden equals or exceeds 20 percent of my total

making the scheduled repayments. Interest will continue to accrue during

monthly gross income; if the Secretary authorizes a period of forbearance

any extension of a repayment period.

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,

If I am required by the School to make minimum monthly payment on my

including service in AmeriCorps. Interest accrues during any period of

loan, the School may also permit me to pay less than the minimum monthly

forbearance.

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

DEFERMENTS – To apply for a deferment, I must request the deferment

action may not exceed the repayment period beyond 10 years.

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

GRACE PERIODS – Unless I am a Less-Than-Half-Time Borrower, I will

for a deferment. I may defer making scheduled installment payments and

receive an initial nine-month grace period before the first payment of my

will not be liable for any interest that might otherwise accrue 1) during any

Federal Perkins Loan must be made. After the close of an authorized

period that I am enrolled and attending as a regular student in at least a half-

deferment period, I will receive a post-deferment grace period of 6 months

time course of study at an eligible school (If the School obtains student

before my payments resume. Interest does not accrue during the initial

enrollment information showing that I qualify for this deferment, the School

grace period or during the post -deferment grace period. The nine-month

may grant the deferment without my request providing the School notifies

initial grace period for Federal Perkins loans does not include any period up

me and gives me the option to cancel the deferment); 2) during any period

to three years during which I am called or ordered to active duty for more

that I am enrolled and attending as a regular student in a graduate fellowship

than 30 days from a reserve component of the Armed Forces of the United

program approved by the Secretary; engaged in graduate or post-graduate

States, including the period necessary for me to resume enrollment at the

fellowship-supported study outside the US; enrolled and attending a

next available enrollment period. I must notify the school that made my

rehabilitation training program for disabled individuals approved by the

loan of the beginning and ending dates of my service, and the date I resume

Secretary; engaged in public service that qualifies me to have part or all of

enrollment. If I am in my initial grace period when called or ordered to

my loan canceled; 3) for a period not to exceed three years during which I

active duty, I am entitled to a new nine-month initial grace period upon

am seeking but unable to find full-time employment; and 4) for a period not

completion of the excluded period.

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

If I am a Less-Than-Half-Time Borrower with outstanding Federal Perkins

qualify for an economic hardship deferment for my Federal Perkins Loan if

Loans, my repayment period begins when the next scheduled installment of

I provide my school with documentation showing that I have been granted

my outstanding loan is due. If I am a Less-Than-Half Time Borrower with

such a deferment under the William D. Ford Federal Direct Loan Program

no other outstanding Federal Perkins Loans, my repayment begins the

or Federal Family Education Loan Program for the period of time for which

earlier of: 9 months from the date my loan was made, or 9 months from the

I am requesting an economic hardship deferment for my Federal Perkins

date I became less than a half-time student, even if I received the loan after I

Loan. If I am serving as a volunteer in the Peace Corps, I am eligible for an

became a less than half-time student.

economic hardship deferment for my full term of service. An economic

hardship deferment based on service as a Peace Corps volunteer may not

PREPAYMENT - I may prepay all or any part of my unpaid loan balance,

exceed the lesser of three years or my remaining period of economic

plus any accrued interest, at any time without penalty. Amou nts I repay in

hardship eligibility.

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

I may continue to defer making scheduled installment payments and will

be considered a prepayment. If I repay amounts during the academic year in

not be liable for any interest that might otherwise accrue for a six -month

which the loan was made and the initial grace period has ended, only those

period immediately following the expiration of any deferment period

amounts in excess of the amount due for any repayment period shall be

described in this paragraph.

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

I am not eligible for a deferment while serving in a medical internship or

installment, the excess will be used to repay principal unless I designate it as

residency program.

an advance payment of the next regular installment.

Page 2 of 4

Omb No. 1845-0061 Form - Federal Perkins Loan Promissory Note Page 2

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