How it works: Unlike grants, loans must be paid back. Perkins loan money is also limited by the amount a school receives each year and awards are first come, first served. The interest rate on the loan is fixed at 5 percent.

Lender/payback: The lender is the school. Students can take up to 10 years to pay back (perhaps longer if they are in the military). If you participate in a specific teaching position, become a part of law enforcement or the military, or work certain nonprofit jobs, you may have your loan discharged.