Summary: This letter provides updated procedures for institutions that are liquidating their Federal Perkins Loan Program portfolio.
SUMMARY: This letter provides updated procedures for institutions that are liquidating their Federal Perkins Loan Program portfolio.
REFERENCE: The Campus-Based Programs portion of the Federal Student Financial Aid
We have revised the procedures that institutions must follow when they end their participation in the Federal Perkins Loan Program.
Do these procedures apply to my institution?
These procedures apply to your institution and must be followed if:
1. Your institution is voluntarily withdrawing from the Federal Perkins Loan Program.
2. Your institutions participation in Perkins is being terminated as a result of an action taken by the Department of Education, e.g., a loss of eligibility or revocation of a provisional certification.
Additionally, if your institution is closing and you wish to provide an orderly withdrawal from the Federal Perkins Loan Program, these procedures may be followed in conjunction with the guidance provided by the Department of Educations Case Management Team for your area.
Why did you revise the procedures?
We revised and clarified the liquidation procedures originally contained in Dear Colleague Letter CB-98-11 to reflect the comments and suggestions for improvement we received from institutional representatives, third-party servicers, and auditors.
What revisions have you made to the previous procedures?
We have reordered the procedures into a more logical progression. For example, the assigning of your institutions outstanding loans and the return of the federal share of the cash on hand now precedes the submission of your final Perkins Loan Report. Furthermore, the required close-out audit is now your final step in the liquidation process. We have also expanded the guidance on purchasing loans, reporting to NSLDS, calculating the final capital distribution, and submitting the compliance audit in an effort to clarify the procedures and to answer your most frequently asked questions.
Who should I contact if I have questions regarding these procedures?
You may contact:
Name Telephone E-mail Fax
Judy Norris (202) 708-9757 Judy_Norris@ed.gov (202) 205-1919
Rhonda Herbert (202) 708-9191 Rhonda_Herbert@ed.gov (202) 260-0522
Enclosure 1: Federal Perkins Loan Liquidation Procedures
Enclosure 2: Instructions for Electronic Fund Transfers and Check Transmittals for the
Federal Perkins Loan Program