There are many provisions for cancellation on Federal Perkins Loans. If you preformed eligible service prior to default you may be eligible for cancellation during that period.
Cancellation Rates for Military, Teachers/Public Servants
With the exception of the early childhood education and volunteer service cancellations, the cancellation rate per completed year of qualifying full-time service is
- First and second years: 15% of the original principal loan amount, plus the interest that accrued during the year
- Third and fourth years: 20% of the original principal loan amount, plus the interest that accrued during the year
- Fifth year: 30% of the original principal loan amount, plus any interest that accrued during the year
A “year of service” consists of 12 consecutive months of service, except for teaching service, where the borrower must teach full-time for a full academic year or its equivalent. For cancellation definitions visit https://ifap.ed.gov/fsahandbook/attachments/1516FSAHbkVol6Ch4.pdf beginning on page 23.
To apply for cancellation or to obtain cancellation forms visit your loan servicer or contact us at 800-830-7570