Posted Date:August 5, 2011
| Author: | William Leith, Service Director, Program Management, Federal Student Aid |
Subject: Federal Perkins Loan Portfolio Liquidation and Perkins Loan Assignment Procedures
Note: This announcement has been superseded by an updated electronic announcement posted on October 5, 2012. Please refer to the updated announcement at http://ifap.ed.gov//eannouncements/100512PerkinsLoanPortfolioLiquidandAssignProc.html.
This announcement and its attachments provide updated information about the required processes for liquidating a Federal Perkins Loan (Perkins Loan) portfolio when a school ends participation in the Perkins Loan Program as well as processes for assigning Perkins Loans to the Department of Education (the Department). The assignment form, as approved by the Office of Management and Budget (OMB), and instructions for the form are also included.
Note: The information in this announcement and its related attachments replaces the guidance last posted in a June 10, 2010 electronic announcement.
Perkins Loan Portfolio Liquidation
A school must liquidate its Perkins Loan portfolio when:
the school voluntarily withdraws from the Perkins Loan Program,
the school is no longer advancing Perkins Loan funds to students, or
the school’s participation is terminated by the Department due to loss of eligibility or revocation of a provisional certification.
Additionally, if a school is closing and wishes to provide an orderly withdrawal from the Perkins Loan Program, these procedures may be followed in conjunction with the guidance provided by the Department of Education’s School Participation Team.
Several steps must occur in order to liquidate a Perkins Loan portfolio. Step-by-step guidance for this process is provided in the attachment, titled “Federal Perkins Loan Liquidation Procedures.”
Assignment of Perkins Loans to the Department
Perkins Loans may be assigned to the Department when a school:
chooses to assign defaulted Perkins loans after due diligence has still resulted in default,
assigns a loan to the Department after making an initial determination of borrower eligibility for a total and permanent disability discharge, and
is liquidating its Perkins Loan portfolio and assigns both defaulted and non-defaulted loans to the Department
Guidance for Perkins Loan Assignments is provided in the attachment titled “Federal Perkins Loan Assignment Procedures.”
Contact Information
If you have questions about this announcement, contact the Campus-Based Call Center at 877/801-7168. Customer service representatives are available Monday through Friday from 8:00 A.M. until 8:00 P.M. (ET). You may also e-mail CBFOB@ed.gov.