Department of Education Says Schools Should Disburse Perkins Loans

February 17, 2016 · by mlivolsi · Spark Notes

February 16, 2016

Prepared by: Harrison Wadsworth (

Since the December passage of legislation reinstating the Perkins Loan Program as of October 1, 2015, the Department of Education has been developing new guidance taking into account some changes to the program made by the extension legislation. That guidance has been undergoing final review for weeks, and it is still expected to be made public any day. In the meantime, COHEAO has been asking Department officials the question schools are asking: should schools be disbursing new Perkins loans before the official guidance is released? At the COHEAO Annual Conference and again late last week, a senior Department official said yes, schools should do so, being careful to follow the law.

The text of the law, H.R. 3594, is attached. Key points to remember are:
• New loans can be made to all undergraduates, whether they have received a Perkins Loan before or not
• New loans can only be made to graduate students who have previously received a Perkins Loan
• Packaging has changed, requiring the awarding of Stafford Loans before Perkins
• The law includes a list of new disclosures that have to be made to borrowers. The disclosures are a bit complicated, but schools should do the best they can. A good-faith effort to comply with the law’s requirement for the new disclosures is highly unlikely to draw punishment by the Department, even if the wording isn’t exactly what the Department will be recommending in its guidance. The law is quite detailed so it provides a good starting point for writing the disclosures.

To sum it up: Don’t get stuck having to send excess cash to the Department, make loans to students who need them now.

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