DIVISION OF FINANCIAL AFFAIRS
Office of the Controller
Federal Perkins Loan Office
1906 College Heights Boulevard # 11023
Bowling Green, Kentucky 42101-1023
270.745.5551
Perkins Cancellation Benefits
Criteria for Employee of a Child or Family Service Agency Cancellation
To receive loan cancellation for being employed at a child or family services agency, a borrower must be providing services only to high-risk children who are from low-income communities. The borrower may also be providing services to adults, but these adults must be members of the families of children for whom services are provided. The services provided to adults must be secondary to the services provided to the high-risk children. The Department has determined that an elementary or secondary school system or a hospital is not an eligible employing agency.
For these cancellation provisions, a borrower's loan is canceled at the rates shown below for each completed year of full-time employment of services:
- 15% of the original principal loan amount--plus any interest that may have accrued during the year--for each amount of the first and second years;
- 20% of the original principal loan amount--plus any interest that may have accrued during the year--for each of the third and fourth years; and
- 30% of the original principal loan amount--plus any interest that accrued during the year--for the fifth year.
Criteria for Law Enforcement or Corrections Officer Cancellation
To establish the eligibility of a borrower for the law enforcement or corrections officer cancellation provision, the school must determine that 1) the borrower's employing agency is eligible and 2) the borrower's position is essential to the agency's primary mission.
1. A local, state, or federal agency is an eligible employing agency if it is publicly funded and its activities pertain to crime prevention, control, or reduction, or to the enforcement of the criminal law. Such activities include, but are not limited to, police efforts to prevent, control, or reduce crime or to apprehend criminals; activities of courts and related agencies having criminal jurisdiction; activities of corrections, probation, or parole authorities; and problems relating to the prevention, control, or reduction of juvenile delinquency or narcotic addiction.
Agencies that are primarily responsible for enforcement of civil, regulatory, or administrative laws are ineligible.
2. For the borrower's position to be considered essential to the agency's primary mission, he or she must be a full-time employee of an eligible agency and a sworn officer or person whose principal responsibilities are unique to the criminal justice system and are essential in the performance of the agency's primary mission. The agency must be able to document the employee's functions.
Individuals whose official responsibilities are supportive, such as those that involve typing, filing, accounting, office procedures, purchasing, stock control, food services, transportation, or building, equipment or grounds maintenance are not eligible for the law enforcement or corrections officeroan cancellation regardless of where these functions are performed. Also, a borrower employed as a public defender does not qualify for cancellation benefits under this provision.
For these cancellation provisions, a borrower's loan is canceled at the rates shown below for each completed year of full-time employment of services:
- 15% of the original principal loan amount--plus any interest that may have accrued during the year--for each amount of the first and second years;
- 20% of the original principal loan amount--plus any interest that may have accrued during the year--for each of the third and fourth years; and
- 30% of the original principal loan amount--plus any interest that accrued during the year--for the fifth year.
Criteria for Disability Cancellation
Any Perkins Loan, NDSL, or Defense Loan will be canceled if the borrower becomes permanently and totally disabled after receiving the loan. Permanent and total disability is the inability to work and earn money because of an impairment that is expected to continue indefinitely or to result in death. NOTE: (1) This standard may be different from standards used under other programs in connection with occupational disability or eligibility for social service benefits. (2) You cannot be considered to have a total and permanent disability if your condition existed at the time your loan was made, unless your condition has substantially deteriorated so that you are now totally and permanently disabled. In addition, a 95% disability does not qualify the borrower for disability cancellation. Receiving Social Security disability benefits does not automatically qualify a borrower for permanent and total disability cancellation.
If a borrower becomes permanently and totally disabled, the school must decide whether to cancel the loan based on medical evidence (certified by a physician) furnished by the borrower or his or her representative. A form must be completed and certified by your physician that the criteria for permanent and total disability have been met. If Western Kentucky University determines that you do meet the eligibility requirements, your loan will be assigned to the Department of Education. At that time, the Department of Education will make a determination of your eligibility for the discharge. If the Department of Education makes a determination that you do meet the criteria for disability discharge, the Department of Education will place your loan in a CONDITIONAL DISCHARGE STATUS, for three (3) years from the date that you became totally and permanently disables, as certified by your physician.
During the conditional discharge period, interest will not accrue on the loan and you are not obligated to make payments on the loan. If, throughout the conditional period of three (3) years, you remain eligible for the discharge, the Department of Education will grant you a final discharge. To qualify for a final discharge, you cannot receive any additional Title IV Student Loans, and cannot have annual earnings from work in excess of the poverty level for a family of two, during the conditional discharge period. The Department of Education will be requesting information on your income from employment during the conditional discharge period.
Please contact our office for further information.
Criteria for Head Start Cancellation
This type of partial cancellation is for service as a full-time staff member of a Head Start program. A full-time staff member is defined as someone who is regularly employed in a full-time professional capacity to carry out the educational part of a Head Start program. The program must operate for a full academic year, or its equivalent, and the borrower's salary may not be more than that of a comparable employee working in the local educational agency.
For these cancellation provisions, a borrower's loan is canceled at the rate shown below for each completed year of full-time employment of services:
- 15% of the original principal loan amount--plus any interest that may have accrued during the year.
Criteria for Nurse or Medical Technician Cancellation
To be eligible for this type of partial cancellation, the borrower must be a full-time nurse or medical technician providing health care services. The borrower must provide health care services directly to patients.
Nurse: A licensed practical nurse, a registered nurse, or other individual who is licensed by the appropriate state agency to provide nursing services.
Medical Technician: A allied health professional (working in fields such as therapy, dental hygiene, medical technology or nutrition) who is certified, registered, or licensed by the appropriate state agency in the state in which he or she provides health care services. An allied health professional is someone who assists, facilitates, or complements the work of physicians and other specialists in the health care systems.
Allied Health Professions:
The American Medical Association defines an allied health professional as one engaged in the following types of services:Anesthesiology Assistant
Art Therapist
Athletic Training
Blood Bank Technology
Cardiovascular Technologist
Cytotechnology
Dental Assistant
Dental Hygienist
Dental Laboratory Technician
Diagnostic Medical Sonography
Dietetic Technician
Dietition/Nutritionist
Electroneurodiagnostic Technology
Emergency Medical Services
Genetic Counselor
Health Information Management
Kinesiotherapist
Low Vision Therapist
Medical Assisting
Medical Illustration
Medical Laboratory Technology
Music Therapist
Nuclear Medicine Technology
Occupational Therapy
Ophthalmic Medical Technology
Orientation and Mobility Therapist
Orthoptist
Perfusion
Pharmacy Technician
Physical Assistant Practice
Physician Assistant
Radiologic Technology
Rehabilitation Counselor
Respiratory Therapy
Specialist in Blood Bank Technology
Surgical Technology
Therapeutic Recreation SpecialistAdditional medical services included in the partial cancellation for Medical Technician are:
Audiologist
Physical Therapy
Speech and Language PathologistFor these cancellation provisions, a borrower's loan is canceled at the rates shown below for each completed year of full-time employment of services:
- 15% of the original principal loan amount--plus any interest that may have accrued during the year--for each amount of the first and second years;
- 20% of the original principal loan amount--plus any interest that may have accrued during the year--for each of the third and fourth years; and
- 30% of the original principal loan amount--plus any interest that accrued during the year--for the fifth year.
Criteria for Teaching Cancellation
Federal Perkins Loan borrowers are eligible for cancellation for full-time teaching in three categories:
1.Teaching in an elementary or secondary school that serves low-income students (Perkins/NDSL loans made on or after July 1, 1987).
To be eligible for Perkins teaching cancellation, you must be teaching full-time at a low-income school, as determined by the State Education Agency. To find out if the school that employs you is classified as a Low Income School, you can check our on-line database for the year(s) that you have been employed as a teacher. Usually, you will want to check the database for the most recent year in which you taught at the school.
| 1998-99 School Year | 1999-2000 School Year | 2000-2001 School Year | 2001-2002 School Year
Note that if you have had a portion of your loan cancelled for teaching at a low-income elementary or secondary school in one year, you can continue to have portions of your loan cancelled for teaching at that school, even if it is not listed as a low-income school in later years. Under certain circumstances, the school that holds your Perkins Loan may permit retroactive cancellation, if you can demonstrate that you qualified for cancellation in a prior year.
To be considered a "low-income school," the school must be in a school district that qualified for funds--in the year for which the cancellation is sought--under Title I of the Elementary and Secondary Education Act of 1965, as amended. The school also must have more than 30% of its enrolled children counted in the Title I funding formula. Questions about the inclusion or omission of a particular school should be directed to the State Education Agency contact in the state where the school is located, and not to the U.S. Department of Education.
2. Teaching in an elementary or secondary school system that has a shortage of teachers in a designated subject matter area (Perkins Loans made on or after July 23, 1992).
Federal Perkins Loan borrowers can also have their loans canceled for full-time teaching if there is a shortage of teachers in their subject area. Each year the State Education Agency determines any subject-matter shortage areas in the elementary and secondary schools within the state. These designated subject-matter shortage areas include mathematics, science, foreign languages, and bilingual education. You should check with your local school system or State Education Agency to find out if your subject matter area has been designated as a teacher shortage area.
3. Teaching disabled students in a public or other nonprofit elementary or secondary school (Perkins/NDSL loans made on or after July 1, 1987).
You must have an official at the school certify that you are teaching handicapped or learning disabled students, either on the postponement/cancellation form itself, or on an official letter from the school bearing the school's seal or letterhead. For Perkins Loans made on or after July 23, 1992, this cancellation includes special education teachers, including teachers of infants, toddlers, children, or youth with disabilities.
Cancellation amounts for years of service
If a borrower is eligible for teacher cancellation under any of the three categories listed above, up to 100% of the loan may be canceled for teaching service, in the following increments:
- 15% canceled per year for the first and second years of service,
- 20% canceled for the third and fourth years, and
- 30% canceled for the fifth year.
