Chart 2
Comparison of Loan Benefits:
Direct Consolidation Loans and Perkins and HHS Loans
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This chart compares the main benefits of some current loans (last four columns)
with the benefits the borrower will receive when consolidating under the William D. Ford Federal Direct Loan
Program (first two columns). The information contained in this chart is valid for consolidation loans made
on or after July 1, 1995.
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| Overview of Major Benefits
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Direct Consolidation Loans (Subsidized and Unsubsidized)
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Direct PLUS Consolidation Loans
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Perkins/National Direct Student Loans (NDSL National Defense Student
Loans(NDSL)
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Health Education Assistance Loans (HEAL)
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Health Professions Student Loans (HPSL) Loans for Disadvantaged
Students (LDS)
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Nursing Student Loans (NSL)
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| Interest rate
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Weighted average or variable with 8.25% cap[1]
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Weighted average or variable with cap[2]
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3, 4, or 5%
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Variable no cap
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3, 5, 7, or 9%
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3, 5, or 6%
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| Maximum repayment term
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30 years[3]
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30 years[3]
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10 years
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25 years
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25 years
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10 years
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| Available repayment plans
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| Standard
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x
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x
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x
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x
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x
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x
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| Income Contingent
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x
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x[31]
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No
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x
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No[4]
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No[4]
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| Graduated
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x
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x
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x
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x
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x
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x
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| Extended
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x
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x
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No
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No
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No
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No
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| Alternative
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x
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x
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No
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No
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x[4]
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x[4]
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| Prepayment without penalty
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x
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x
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x
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x
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x
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x
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| Cancellation upon borrower's death or total disability
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x
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x
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x
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x
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x
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x
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| Discharge due to school closing or falsely certifying loan
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x
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x
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x[6]
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No
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No
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No
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| Grace period
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6 months[7]
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No
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6-9 months[8]
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9 months[9]
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1 year
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9 months
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| Cancellation for public service
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No
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No
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x[10]
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No
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No
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No
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| Deferment Options
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All Borrowers
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Borrowers Prior to 7/1/93[11]
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| Attending school half-time
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x
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x
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x
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No
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No
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Up to 10 years[12]
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| Attending school full-time
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x
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x
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x
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x
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x[13]
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Up to 10 years[12]
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| In graduate fellowship program
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x
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x
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x[14]
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Up to 2 years[15,16]
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No[17]
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No
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| Attending rehabilitation program for disabled individuals
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x
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x
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x[14]
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No
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No
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No
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| Unemployed
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Up to 3 years
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Up to 3 years
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x[14]
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No
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No
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No
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| Economic Hardship (including Peace Corps service)
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Up to 3 years
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Up to 3 years
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x[14]
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No
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No
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No
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| Serving required internship/residency
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Up to 2 years[18]
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Up to 2 years[18]
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Up to 2 years[19]
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Up to 4 years[20]
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x
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No
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| Serving internship/residency leading to degree/certificate
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Up to 2 years[18]
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Up to 2 years[18]
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Up to 2 years[21]
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x[22]
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No
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No
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| Temporarily totally disabled or required to provide full-time care for disabled
dependent
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Up to 3 years[18]
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Up to 3 years[18]
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Up to 3 years[23]
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No
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No
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No
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| Teaching in designated teacher shortage area
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Up to 3 years[18]
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No
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No
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No
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No
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No
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| Serving in the Armed Forces, Peace Corps, Public Health Service, ACTION, or as a
full-time volunteer for tax-exempt organization
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Up to 3 years[18]
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Up to 3 years[18]
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Up to 3 years[24]
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Up to 3 years[25]
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Up to 3 years[26]
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Up to 3 years[26]
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| Active duty in NOAA corps
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Up to 3 years[18]
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No
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Up to 3 years[21]
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No
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Up to 3 years
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Up to 3 years
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| Qualifying parental leave
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Up to 6 mos.[18]
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No
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Up to 6 mos.[21]
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No
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No
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No
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| Working mother
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Up to 1 year[18]
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No
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Up to 1 year[21]
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No
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No
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No
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New Borrowers as of 7/1/93[11]
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| Attending school at least half-time
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x
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x
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x
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No[27]
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No[27]
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Up to 10 years[12]
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| Attending approved graduate fellowship or rehabilitation program for
disabled individuals
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x
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x
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x
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Up to 2 years[28]
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No[17]
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No
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| Unemployed
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Up to 3 years
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Up to 3 years
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Up to 3 years
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No
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No
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No
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| Economic hardship (including Peace Corps service)
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Up to 3 years
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Up to 3 years
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Up to 3 years
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No
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No
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No
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| Other
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No
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No
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x[29]
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x[30]
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No
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No
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Notes
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- If application is received on or after 2/1/99, weighted average rounded to nearest higher
one-eighth of one percent with 8.25% cap; all others variable with 8.25% cap.
- If application is received on or after 2/1/99, weighted average rounded to nearest higher
one-eighth of one percent with 8.25% cap; if application is received between 10/1/98 and 1/31/99,
variable with 8.25% cap; all others variable with 9% cap.
- For standard repayment plan, 10 years; for income contingent, 25 years; for graduated and extended,
may range from 12 to 30 years, depending on amount borrowed.
- Renegotiated repayment schedules may be arranged between the school and the borrower, but must be
repaid within the 10-year limit or, at the schools discretion, within 25 years.
- Removed
- Perkins Loan, National Direct Student Loan, and National Defense Student Loan borrowers are not
eligible for discharge due to falsely certifying a loan.
- For any Direct Consolidation Loan that meets the in-school consolidation eligibility requirements
at the time of application.
- 6 months for National Direct Student Loans made on or after 10/1/80; 9 months for Perkins Loans made
on or after 7/1/87 and National Direct Student Loans made before 10/1/80; Perkins Loans and National
Direct Student Loans made on or after 10/1/80 also have a 6-month post-deferment grace period.
- After leaving school or a qualified internship/residency.
- Perkins Loans, National Direct Student Loans, and National Defense Student Loan borrowers are
eligible for deferment of payments in anticipation of cancellation during periods of public service.
- Deferment benefits in the Perkins Loan, National Direct Student Loan, and National Defense Student
Loan Programs are granted in accordance with the date the loan is made; these benefits are not borrower
specific.
- For loans disbursed on or after 11/4/88, if enrolled in collegiate nursing program leading to
baccalaureate or graduate degree, advanced training in nursing or training to become a nurse anesthetist,
or combination of these; 5-year limit for loans disbursed prior to 11/4/88.
- For loans disbursed on or after 11/4/88; attendance must be at health professions school.
- Eligibility for this deferment was extended to all Perkins Loan, National Direct Student Loan, and
National Defense Student Loan borrowers as of 10/7/98.
- For loans made after 10/21/85.
- Also for up to 4 years in advanced health professional training (including internships and
residencies); up to 2 years for fellowship training program or full-time educational activity directly
related to profession borrower is preparing for, if prior to or within 12 months after completion of
advanced professional training, for loans made after 10/21/85.
- But available for advanced health professional training (including internships and residencies);
up to 2 years for fellowship training program or full-time educational activity directly related to
profession borrower is preparing for.
- If borrower currently has a loan with this deferment option or has an outstanding balance on a
FFEL Program loan made prior to 7/1/93.
- For loans made on or after 10/1/80.
- Must be in field related to health education.
- For Perkins Loans only.
- Must be in field related to health education; unlimited for loans disbursed before 10/22/85; 48
months for loans disbursed after 10/22/85.
- For National Direct Student Loans made on or after 10/1/80, and for Perkins Loans; care for spouse
only for National Direct Student Loans.
- Service in Public Health Service only for loans made on or after 10/1/80 and before 7/1/93;
volunteer for tax-exempt organizations only for loans made on or after 10/1/80 and before 7/1/93.
- Up to 3 years each in Armed Forces, National Health Service, Peace Corps, and ACTION; 12 year
maximum.
- Service in ACTION and volunteer for tax-exempt organization not eligible.
- Must be full time.
- For graduate fellowships only; see also notes 12 and 13.
- Perkins Loan, National Direct Student Loan, and National Defense Student Loan borrowers performing
public service that qualifies them for loan cancellation are eligible for deferment.
- Up to 1 year for chiropractic school graduates; up to 3 years for practicing primary health care.
- Direct PLUS Consolidation Loans made before 7/1/06 are not eligible for the Income Contingent Repayment plan.
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