| AwardYear: 1996-1997 ChapterNumber: ChapterTitle: Contents PageNumbers: 1-4 Direct Loan School Guide 1996-97 DIRECT LOAN SCHOOL GUIDE CONTENTS OVERVIEW . . . . . Overview-1 CHAPTER 1 DIRECT LOAN PARTICIPATION . . . . . 1-1 Eligibility Criteria . . . . . 1-1 Origination Status . . . . . 1-2 School Origination Options (chart) . . . . . 1-3 Additional Criteria for Origination Loans Under Options 1 and 2 . . . . . 1-2 Deciding on the Type of Participation . . . . . 1-4 100 Percent Participation vs. Partial Participation . . . . . 1-4 Changing Origination . . . . . 1-5 Origination Fees . . . . . 1-5 Consortia . . . . . 1-6 Withdrawal Procedures . . . . . 1-6 Points to Consider in Managing Direct Loans . . . . . 1-6 CHAPTER 2 ELECTRONIC RESOURCES . . . . . 2-1 Participation through EDE . . . . . 2-1 Hardware and Software Requirements . . . . . 2-2 Hardware/Software (chart) . . . . . 2-3 Implementation . . . . . 2-4 Technical References . . . . . 2-5 CHAPTER 3 INFORMATION AND COUNSELING FOR BORROWERS . . . . . 3-1 Getting the Word Out . . . . . 3-1 Explaining New Terms . . . . . 3-2 Department Publications . . . . . 3-3 Direct Loan Servicing Center Communications . . . . . 3-3 Repayment Plan Information . . . . . 3-4 Direct Loan Program Repayment Plans (chart) . . . . . 3-5 Repayment Periods for Extended or Graduated Plans (chart) . . . . . 3-6 Entrance and Exit Counseling . . . . . 3-6 Counseling Materials . . . . . 3-7 CHAPTER 4 GETTING STARTED: ESTABLISHING DIRECT LOAN ELIGIBILITY . . . . . 4-1 Some Provisions Common to the FFEL Program . . . . . 4-1 Determining Direct Subsidized and Unsubsidized Loan Eligibility . . . . . 4-2 Determining PLUS Eligibility and Loan Amounts . . . . . 4-3 Application Process . . . . . 4-3 Credit Issues . . . . . 4-4 Parent Notification . . . . . 4-4 School Notification . . . . . 4-5 Applicants with Adverse Credit Histories . . . . . 4-5 Packaging . . . . . 4-6 Maximum Annual Loan Limits (chart) . . . . . 4-8 Total Loan Limits . . . . . 4-8 CHAPTER 5 ORGIINATION RECORDS AND PROMISSORY NOTES . . . . . 5-1 Essential Records . . . . . 5-2 Loan Origination Records . . . . . 5-2 Creating Loan Origination Records . . . . . 5-3 Direct Loan Record Data Items (chart) . . . . . 5-4 Loan ID . . . . . 5-5 Creating Direct Subsidized or Unsubsidized Loan Origination Records . . . . . 5-5 Creating Direct PLUS Loan Origination Records . . . . . 5-6 Promissory Notes . . . . . .5-6 Option 1 and Option 2 Schools . . . . . 5-7 Loan Amount Increase (chart) . . . . . 5-8 Conveying Records and Notes . . . . . 5-9 Determining When to Begin the Loan Process . . . . . 5-11 Time Frame Comparison for Promissory Note and Loan Record Creation (chart) . . . . . 5-13 CHAPTER 6 RECEIVING AND DISBURSING FUNDS . . . . . 6-1 General Information . . . . . 6-2 Requesting Funds: Option 2 Schools . . . . . 6-4 Calculating Funding Needs . . . . . 6-4 Timing the Requests for Direct Loan Funds . . . . . 6-4 Requesting Direct Loan Funds . . . . . 6-5 Issues to Consider in Requesting Funds . . . . . 6-7 Requesting Funds: Option 1 and Standard Origination Schools . . . . . 6-9 Funding and Disbursement Timeline/Option 1 and Standard Schools (chart) . . . . . 6-10 CHAPTER 6 (CONTINUED) Disbursing Funds to Borrowers . . . . . 6-10 Special Direct PLUS Loan Considerations . . . . . 6-12 Informing Students About Disbursements . . . . . 6-13 Disbursement Decision Chart . . . . . 6-14 Reporting Disbursements . . . . . 6-15 Payment Adjustments . . . . . 6-15 Direct Loan Cancellations, Adjustments, and Payments (chart) . . . . . 6-17 Direct Loan Servicing Center Response and Actions . . . . . 6-18 CHAPTER 7 CASH MANAGEMENT AND DATA MATCHING (RECONCILIATION) . . . . . 7-1 General Information . . . . . 7-1 Cash Management . . . . . 7-2 Data Matching . . . . . 7-3 The Loan Detail Record . . . . . 7-5 The Cash Detail Record . . . . . 7-5 CHAPTER 8 CERTIFYING BORROWER ENROLLMENT [REMOVED--SEE PAGE 8-1] CHAPTER 9 DIRECT LOAN SERVICING CENTER RESPONSE AND SUPPORT . . . . . 9-1 General Information . . . . . 9-1 Student Service Features . . . . . 9-2 Addresses and Toll-Free Number . . . . . 9-3 Standard Communications . . . . . 9-3 Loan Issuance Notification . . . . . 9-3 Deferment and Forbearance Assistance . . . . . 9-3 Deferments . . . . . 9-4 Forbearance . . . . . 9-5 Annual Statements . . . . . 9-5 School Service Features . . . . . 9-6 Addresses and Toll-Free Numbers . . . . . 9-6 Loan Origination/Servicing Center Response Summary (chart) . . . . . 9-9 Problem Resolution . . . . . 9-10 CHAPTER 10 QUALITY ASSURANCE . . . . . 10-1 General Information . . . . . 10-1 Management Worksheets . . . . . 10-2 Progress Reports . . . . . 10-3 School Draw-Down Reconciliation Report--Appendix A Direct PLUS Loan Application and Promissory--Appendix B Direct PLUS Loan Endorser Application--Appendix C Direct Stafford/Ford Loan Promissory Note and Disclosure--Appendix D Promissory Note Review/Acceptance Guidelines and Edits--Appendix E Account Statements--Appendix F Billing Communications--Appendix G Quarterly Unsubsidized Interest Statement--Appendix H Welcome Letters--Appendix I Forbearance Letters--Appendix J Deferment Letters--Appendix K Death/Total and Permanent Disability Letters--Appendix L Disbursing Loan Amount Letters--Appendix M Returned Check Letters--Appendix N Income Contingent Repayment Plan Letters--Appendix O Clearing Bad Credit Letters--Appendix P Promissory Note Fraud Letters--Appendix Q Bankruptcy Letters--Appendix R Interest Letters--Appendix S Repayment Plan Letters--Appendix T Payment History Letters--Appendix U Payment Due Date Letters--Appendix V Account Discrepancy Letters--Appendix W Miscellaneous Letters--Appendix X Help Listing--Appendix Y Direct Loan Program Regulations Listing--Appendix Z Direct Loan Core Publications--Appendix AA |