Government stops funding for Federal Perkins Loan - KBJR 6 Your Weather Authority: News, Weather & Sports

Government stops funding for Federal Perkins Loan

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After 60 years of providing funds for college students, the Federal Perkins Loan is ending.

The loan program offered low-interest loans and 9-month grace periods for students to pay back.

According to the University of Wisconsin financial aid officials, the program was originally scheduled to expire back in 2014, but it received an automatic one-year extension until October 1st, 2015. 

In 2015, the program was given a two-year extension with the hope that in those two years, Congress would reauthorize the Higher Education Act and address all types of federal student loans, including the Federal Perkins Loan. 

Legislation has been introduced to allow for the further extension of the program, but no immediate action has been taken.
Abbey Schield, is a non-traditional student at University Wisconsin-Superior 
she says when she did her undergrad, she relied on the Perkins Loan.

"I wouldn't be here without loans. I didn't get grants. My entire education is loans and without that service, there's going to be a lot of students messed up with it," said Schield.

Financial aid staff at UW-Stevens Point said they're concerned about the impact it will have on future students.

The program has funded over 30 million students. Just last year over 2,000 UWSP students received the Perkins Loan.

 "This is a significant amount loss to our students of a very good program," Financial aid associate director Carol Scipior said.

The average loan amount awarded was $2,000 per year.

UWSP's Bursar Terri Chang said the government is debating whether or not to restore the loan or create a "One Loan" program.

"I much rather see the Perkins Loan receive the support to bring it back," Chang said. "Otherwise I hope something as beneficial comes from the government."

UWSP staff said they've reached out to parents and students about the change, and advised them to take a careful look at their future budget.

"I don't think that they'll probably realize the true impact on it until next year when they file their FAFSA," Scipior said.

Directors said the loan will officially stop disbursing funds in June of 2018.

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