Posted Date:January 28, 2009
Author: William Leith, Service Director, Program Management, Federal Student Aid
Subject: Updated Guidance on Making Direct Loan Borrower Payments
Each year, we remind schools of the correct process for making a borrower payment by sending a check to the Direct Loan Servicing Center's (DLSC's) Payment Center. A borrower payment is made in order to return funds at the borrower's request more than 120 days after disbursement.
If you are returning funds at a borrower's request within 120 days of disbursement, or are returning funds at any time in order to comply with a statutory or regulatory requirement, you should make the appropriate adjustment to the borrower's loan record or records and follow the process for making a refund of cash as updated in the Electronic Announcement posted on the Information for Financial Aid Professionals (IFAP) Web site.
To ensure the most accurate and timely processing of a borrower payment, please follow these guidelines:
- Issue a check to the U.S. Department of Education and include the borrower's name, loan ID, and loan amount being returned on the check.
- Include a completed Direct Loan Payment to Borrower Account form (attached below) with the check.
- Mail the check and completed form to the DLSC's Payment Center at:
U.S. Department of Education
Attention: Payment Center
P.O. Box 530260
Atlanta, GA 30353-0260
If you have questions about this bulletin or returning funds at the borrower's request more than 120 days after disbursement, contact the COD School Relations Center at 800/848-0978 or e-mail CODSupport@acs-inc.com.