While you were sleeping, the Federal Perkins Loan Program expired last Wednesday night after the Senate failed to approve an extension.
The loan program specifically caters to low-income students.
The cut means no new Perkins loans will be offered, but students currently receiving Perkins loans will continue to receive them until they graduate.
The Perkins loan has been around since 1958, making it the oldest federal student loan program in existence. It spanned 11 administrations and helped over 30 million low-income students in its lifetime, providing $36 billion in aid.
Perkins loans didn't offer students a whole lot of money in comparison to other loan programs, but for many it was enough to make a dent in their debt loads. According to the Office of Federal Student Aid, Perkins offered up to $5,500 a year for students with "exceptional" financial need. The total amount an undergraduate student could borrow was $27,500. For students working on a Master's degree, the Perkins loan offered up to $8,000 per year ($60,000 total including undergraduate loans).
Some folks might have seen this coming. The Perkins program stopped getting new federal reimbursement money a decade ago, causing the amount of available aid to shrink. In turn, the program wasn't able to help nearly as many students as before. It provided aid to just over half a million people in 2012-2013. The U.S. Senate allowed the program to expire in an effort to "simplify student aid."
However, with no program to replace it, the only thing the cut means for low-income students is that they have fewer resources to help them pay for school.
On the eve of State of Opportunity's special Issues and Ale event, news like this proves there's more reason now than ever to discuss the state of college affordability in Michigan. It's not too late to register – you can do so here.
