An Update on Perkins Loans Post-October 1

October 24, 2017

Written by Wes Huffman (whuffman@wpllc.net)

Following the expiration of the authority to make new Perkins Loans on October 1, COHEAO has received several inquiries regarding loan disbursements, the path forward for Perkins, and other related matters. Below is COHEAO’s guidance regarding the inquiries we have received to date:

• For students with loans disbursed by September 30, 2017, you may increase or decrease the award provided the final disbursement occurs by June 30, 2018. COHEAO has received multiple inquiries on the topic of adjusting the awards for students this year. This is a great opportunity to increase the award and ensure that your institution is not left with excess cash. The award may be increased or decreased as long as the student received a first disbursement by September 30, 2017.   

• If loans were not first disbursed by September 30, 2017, new Perkins Loans cannot be made without Congressional action.

• The Department of Education intends to use a process similar to the Excess Liquid Capital (ELC) process for the potential wind-down of Perkins Loans, but ED will not begin that process for the return of the federal share until October 1, 2018. 

• Separate from the wind-down process, the ELC determination for 2017 is delayed until the first part of 2018 to allow for the integration of the e-Campus Based and COD systems.  Schools can expect to receive a notification in early 2018 if they have excess cash for the 2016-17 AY along with instructions on how to return those funds. 

• The fight to save Perkins Loans is FAR FROM OVER and your help is needed more than ever. The Perkins Loan Extension Act (H.R. 2482/S. 1808) has broad bipartisan support, particularly in the House of Representatives where there are currently 237 cosponsors, more than half of the 435 voting members. COHEAO members and other Perkins Loan advocates are pushing hard for an extension. Perkins advocates can support these efforts by signing up for COHEAO’s state calls with Senators and Representatives. You can also support the cause by educating your colleagues on campus and engaging your students and borrowers in the fight to save this valuable program. Additional information is available online.

COHEAO will continue to provide updates as developments warrant. If you have any questions, please do not hesitate to contact COHEAO Associate Director Wes Huffman (whuffman@wpllc.net).