Perkins Loan Rehabilitation Plan and Procedure

In accordance with current Federal Perkins Loan Regulations, Wellesley College has established the following Loan Rehabilitation Plan.

Rehabilitation is a process by which a borrower enters into an agreement with Wellesley College to make (12) twelve consecutive on- time payments on their defaulted NDSL/Perkins Loan. Payments are made payable to Wellesley College and sent to University Accounting Service (UAS). Those accounts that have been placed with a collection agency will make payment of that agency.

Payments will be deemed “on time” if received within the first five days of the month that the payment was due. Wellesley College, in accordance with its policy, will establish the amount to these payments.

The monthly payment for the twelve-month period will be the greater of, or an amount equal to that which would have all past due and accrued interest paid at the end of the rehabilitation period, or $40.00. If the defaulted NDSL/Perkins Loan has been placed with a collection agency, the monthly payment may include collection costs in addition to the past due and accrued interest to be paid at the end of the rehabilitation period.

Once the borrower has successfully made the required twelve (12) consecutive payments, the loan will be considered rehabilitated, it will be removed from its defaulted status and all negative credit will be repaired. At that time, the borrower signs a new repayment schedule not to exceed (5) years and is subject to all other terms and conditions of the original promissory note. The borrower also regains eligibility for any remaining benefits and privileges of the original promissory note.

Rehabilitation is available only at the written request of the borrower. Any consecutive monthly repayments that were made by the borrower prior to the agreement may be counted as payments toward rehabilitation if the minimum payment requirements are met and one (1) payment was paid after the 7/1/2000 date. If a payment is skipped or determined to be late, the rehabilitation agreement is nullified and the borrower is once again subject to standard collection procedures.

If a loan goes back into default after the rehabilitation plan has successfully completed, it cannot be rehabilitated again. Rehabilitation is available one time only.

Student Financial Services
Created: September 9, 2007
Modified: September 9, 2007