The Federal Perkins Loan Program provides a low interest (5%) student loan for both undergraduate and graduate students with exceptional need. The University of Nebraska-Lincoln acts as the lender using its own funds, as well as those provided by the Federal Government.
Repayment begins after an initial nine (9) month grace period once the borrower graduates, leaves school, or drops below half-time enrollment. Although payments are not required and interest will not accrue, borrowers can begin making payments during grace periods. Borrowers will receive communications throughout the grace period, so it is important to keep contact information updated.
The University of Nebraska-Lincoln must ensure that students who have borrowed Federal Perkins Loans receive exit counseling before they leave school. Exit counseling provides the borrower specific details about repayment of their loan.
**Effective June 30, 2023: The Department of Education announced that all colleges and universities are required to assign loans made under the Federal Perkins Loan Program that have been in default for more than two years. Once the loan is accepted and assigned to the Department of Education, the institution can no longer accept any payments from the borrower. Borrowers who wish to satisfy their debt of an assigned loan must contact the Department of Education's Customer Service Center at (866)313-3797.**
Repayment Options
The minimum monthly payment is $40.00 if the borrower received a Perkins Loan for the first time on or after October 1, 1992. The minimum monthly payment may increase depending upon the total amount borrowed from the Perkins Loan Program.
The University of Nebraska-Lincoln contracts with Heartland ECSI for the billing and collecting of our Federal Perkins Student Loans.
Heartland ESCI
School Code: W18
Heartland ECSI – Payments
University of Nebraska-Lincoln
c/o Educational Computer Systems, Inc.
PO Box 718
Wexford, PA 15090
Heartland ECSI – Forms
University of Nebraska-Lincoln
c/o Educational Computer Systems, Inc.
PO Box 1278
Wexford, PA 10590
Deferment, Forbearance, and Consolidation
Deferment
A deferment extends the repayment period for a specified period of time. Deferment is granted when the borrower submits an application and meets certain regulatory requirements. Payments are not required and interest will not accrue during periods of deferment. Once the approved deferment period ends, the borrower will receive a six (6) month grace period before regular scheduled payments will resume.
Forms to apply for Deferment can be found on the ECSI Website.
Forbearance
Forbearance is a temporary postponement of payments, an extension of time allowed for making payments, or an allowed time for making smaller monthly payments.
Forbearance benefits are limited to a maximum of 36 months over the life of the loan. The borrower may qualify for forbearance if: his/her total monthly payments of all Title IV loans exceeds 20% of his/her monthly gross income, due to poor health, or other acceptable reasons such as a change in employment. Interest continues to accrue during the forbearance period. Forbearance will only be granted in increments of up to 12 months per application.
Forms to apply for Forbearance can be found on the ECSI Website.
Consolidation
If a borrower has student loan debt, he/she may be eligible to consolidate all of his/her Federal loans. Loans eligible for consolidation include Federal Subsidized and Unsubsidized Stafford Loans, Federal Perkins/National Direct Student Loans, Health Professional Student Loans and Federal Parent Loans in some cases.
For more information, you may contact the Loan Consolidation Information Center at 1-800-557-7392 or online at StudentAid.gov.
Cancellation Benefits
Cancellation is the forgiveness of a portion or all of a loan when the borrower has met certain employment requirements or when other regulatory conditions have been met. The borrower must submit an application each year he/she qualifies for cancellation.
Forms to apply for Cancellation can be found on the ECSI Website.
Default and Delinquency
To default means to fail to make payments on a student loan as scheduled or fail to file deferment/cancellation requests on time according to the terms of the promissory note.
Once a borrower defaults on his/her Federal Perkins Loan, the following can happen:
- Holds will be placed on University records that will prevent future registration, release of transcripts and diplomas.
- The loan balance will be accelerated and become due in full.
- The default status of the loan will be reported to the national credit bureaus. A negative credit rating may make it difficult to borrow money in the future.
- The borrower will lose the right to forbearance, deferment and cancellation benefits.
- The borrower will lose the right to receive additional Federal Student Financial Aid.
- The loan will be assigned to a professional collection agency and all costs involved with the collection of the loan will be assessed to the borrower. Collection costs can be up to 40% of the loan balance placed with the agency. Continued delinquency may result in legal action and the borrower will be responsible for legal fees related to litigation of the debt.
Loan Rehabilitation
If a borrowers defaulted on his/her Federal Perkins Loan, he/she may rehabilitate the loan by requesting and making nine (9) on-time, monthly payments, as determined by the University or our collection agency. A borrower may rehabilitate a defaulted Federal Perkins Loan only once.
Benefits of successful loan rehabilitation:
- The borrower will qualify for the benefits and responsibilities of the original promissory note.
- The default will be removed from his/her credit history.
- The borrower will have a maximum of nine (9) years to repay the remaining balance in full.