| DCLPublicationDate: 9/1/97 DCLID: Disaster Letter-97-21 AwardYear: Summary: Storm damage and flooding in Illinois. September 22, 1997 DISASTER LETTER 97-21: Storm damage and flooding in Illinois. Dear Guaranty Agency Director: On September 17, President Clinton declared COOK county in ILLINOIS to be a disaster area because of storm damage and flooding that began on August 16. Guaranty agencies and lenders are authorized to use the Department's disaster-related forbearance policies to assist FFEL borrowers who are residents of that county. Please note that this letter is designated as "Disaster Letter 97-21." We did that in response to requests from several FFEL Program participants who recommended that each natural disaster letter be numbered (this is the 21st disaster letter to be sent in 1997.) For your reference, here is a list of the previous disaster letters (retroactively numbered) sent in 1997: DISASTER LETTER DATE SUBJECT 97-01 01-14 flood - CA, ID, NV 97-02 01-21 flood - CA, ID, NV, WA 97-03 01-24 flood - OR 97-04 02-06 flood - WA 97-05 03-02 tornado - AR 97-06 03-05 flood - KY, OH 97-07 03-10 flood/tornado - AR, IN, KY, OH, TN, WV 97-08 03-25 flood/tornado - AR, IL, IN, KY, OH, TN, WV 97-09 03-26 flood/tornado - AR, IL, IN, KY, OH, TN, WV 97-10 04-03 tornado - TN 97-11 04-08 flood - ND, SD 97-12 04-09 flood - MN 97-13 04-16 flood - AR 97-14 04-17 flood - MN 97-15 04-25 flood - ND 97-16 05-27 flood - MN 97-17 07-16 flood - MI, TX, WI 97-18 07-30 flood - VT 97-19 08-19 flood - AL, CO 97-20 08-27 flood - MN On January 14, 1997, in "Disaster Letter 97-01," the Department published an interim policy that permitted loan holders to more easily assist borrowers who were victims of major natural disasters. That policy has received such widespread approval that we believe there is no further need to consider it an "interim" policy. So that all FFEL Program participants will be familiar with this policy, it is reprinted below: 1. Loan holders are strongly recommended to grant forbearances to borrowers who contact them and indicate that they have been adversely affected by the disaster and need temporary relief from their loan obligations. If the holder believes that the borrower has been harmed and needs assistance, the holder may grant a forbearance for up to 3 months based on either the borrower's oral or written request for assistance, which must be documented in the holder's files. 2. The holder does not need to obtain supporting documentation or a signed written agreement from the borrower to justify a forbearance for this initial 3-month period. The Secretary will decline to enforce the requirements of 34 CFR 682.211(c) for this period. 3. A continuation of the forbearance past this 3-month period will require supporting documentation and a written agreement from the borrower. Lenders and guaranty agencies may contact the Department's toll- free number at 1-800-433-7327, Monday through Friday from 9:00 a.m. to 5:00 p.m.EST for further updates. This letter has also been sent to each regional office of the Department, plus the National Council of Higher Education Loan Programs, Inc., the Consumer Bankers Association, the National Association of Student Financial Aid Administrators, and the Student Loan Servicing Alliance. Sincerely, Pamela A. Moran Chief, Loans Branch Policy Development Division Student Financial Assistance Programs |