Perkins Loan Services

Employment Deferment and Cancellations

Military Cancellation

If the borrower has received orders to report to an area of hostility or area of imminent danger and meets the following qualifications, the borrower is entitled to cancel a portion of his Perkins loan as indicated below. The Military Form should be completed and submitted at the end of 12 consecutive months of service.

The borrower must:

• be a member of the U.S. Armed Forces, the National Guard, or the Reserves. Any portion of a month the borrower is on active duty in a qualifying area is considered a full month and counts toward cancellation.
• serving in an area of hostility or area of imminent danger for 12 consecutive months.
• receiving special pay under section 310 of Title 37 of the U.S. Code.

Areas of hostility are those placed on the Dept of Defense Hostile Fire/Imminent Danger pay areas list. An "area of hostility" should not be confused with military service that qualifies for other forms of special pay, such as flight pay or service overseas in areas where additional pay is given for a dependent's living allowance.

The amount of cancellation remains at a total of 50 percent; that is, 12.50 percent for each year of qualifying service.