Bulletin ID
DLB - 96 - 8
| PublicationDate: 6/1/96 BulletinID: DLB - 96 - 8 Dear Colleague: By now, I am sure you are aware that there is no cap on the William D. Ford Federal Direct Loan Program (Direct Loans) for the 1996-97 academic year. Due to President Clinton's commitment to Direct Loans and the education community's support for choice in the student loan programs, Direct Loans continues to grow. In the 1996-97 academic year, there will be approximately 1700 schools participating in the Direct Loan Program, constituting 45 percent of total student loan volume for the year. At that time, the Direct Loan Program will serve approximately 2.1 million families with a total loan portfolio of $13 billion. As a reminder, effective July 1, 1996, the new 30-day reporting requirement for submission of all Direct Loan records will be implemented. As stated in the Federal Register, December 1, 1995, section 685.301, "a school that originates a loan must submit the promissory note, loan origination record, and initial and subsequent disbursement records to the Secretary no later than 30 days following the date of the disbursement." Cancellations and adjustments of loans are considered part of the disbursement records and, therefore, are also required to be reported within 30 days of the date of the adjustment or cancellation. Schools will be required to comply with this regulation immediately. This new requirement will help ensure program integrity in two ways. First, schools will be able to account for all Direct Loan funds in a timely manner; and second, we will be able to make sure that all loans are booked and that loan servicing is initiated as quickly as possible after the loans are made. This requirement is most important for the integrity of the program and is especially critical for unsubsidized and PLUS loan borrowers, who must begin repayment and be informed of interest accruing on their loans. If schools are aware that they will have problems complying with the 30-day requirement, we suggest that these institutions call their school relations representative at the Loan Origination Center, their regional Client Account Manager, NCS customer support staff or the Direct Loan Task Force for immediate assistance. For your convenience, we have enclosed a list of important Direct Loan phone numbers with this letter. If your school does encounter problems, assistance from the Department is available. It is important to let us know about any issues that could affect your ability to meet this requirement because the consequences of non-compliance could be serious. To date, the Department of Education has an excellent record with cash management and loan detail reconciliation. For the 1994-95 award year, 100 percent of all cash has been accounted for and less than 250 out of the one million loan origination records are not yet reconciled. For the current 1995-96 award year, 77 percent of all records are accounted for and 93 percent of all loan detail information is reconciled. To better assist schools with Direct Loan processing, training on reconciliation, which is now being referred to as "cash management and data matching," will be offered on a weekly basis at the Regional Training Facilities beginning in October 1996. This training will offer both a beginner and advanced level for individuals working with the Direct Loan Program. These sessions will provide step-by-step procedures on how to best process Direct Loans, report all records and "reconcile" your database. A new cash management and data matching guide will be provided to all attendees. Please attend these sessions since they are designed to be of assistance to you. Enclosed is a list of "Helpful Hints and Best Practices" that we hope will assist you in better managing Direct Loans, especially in the areas of cash management and data matching reporting requirements. Thank you for your continued support of the Direct Loan Program. Sincerely, Leo L. Kornfeld Senior Advisor to the Secretary Enclosures ---------------------------------------------------------------------------------------------------------------------- HELPFUL HINTS AND BEST PRACTICES GENERAL: · Use the promissory note review/acceptance guidelines contained in Direct Loan Bulletin DLB-96-6 to help ensure that promissory notes are accepted (and not rejected) by the Loan Origination Center (LOC). · Be sure to export and transmit all: 1. Loan Origination Records 2. Promissory Notes Remember to submit both the electronic and paper manifest. Be sure to sign the manifest and submit with all promissory notes to the LOC. 3. Disbursement Records (including adjustments and cancellations) To the extent possible, it is best to process and transmit records in the order of occurrence; loan origination records, promissory notes, disbursement records, cancellations and adjustments. · Large loan volume schools should be aware that EDExpress may not be the best way to process Direct Loans. Using EDExpress will be slow and cumbersome unless specific steps are taken to maximize system efficiencies. NCS customer service will be able to assist you in determining the best configuration for your school. · It is important to establish a regular production schedule for all loan processing steps; including, entering loan records, exporting batches and importing acknowledgements. · Import all pending acknowledgements. This includes all loan origination, promissory note and disbursement acknowledgements. Remember to check for rejects. · Wait 5 business days past your "as-of-date" (end date) to submit a reconciliation batch. This will allow enough time for all pending items transmitted to the LOC to return from the LOC as acknowledged. · Always back-up your computer system regularly. Also check your back-up data to make sure the back-up system is working accurately. CASH DETAIL: · Be sure to reconcile all cash reported to the LOC (drawdowns and excess cash returns) with your internal accounting records. This activity should be done on a daily or weekly basis. · When a correction to a reported cash amount is needed, be sure to back out the incorrect entry, using the same date, and then enter the correct date and amount. · Review excess cash for accuracy: 1. Be sure to enter correct transaction types. For example, be careful not to enter an excess cash amount as a draw down amount or vice versa. 2. Be sure to enter the correct positive or negative sign on cash amounts. 3. Be aware that the LOC records the date it receives excess cash and matches this date with the date the school has reported. 4. Be careful not to transpose numbers. 5. It is best not to return excess cash by individual amounts since each separate transaction must be reported to the LOC. Whenever possible, aggregate excess cash into one amount and return by ACH. · Review cash receipts on your system with the school's internal cash activity. Be sure all dates and amounts match exactly. LOAN DETAIL: · When entering disbursement records into the EDE computer system, be sure to enter the correct disbursement date. The only way to change a disbursement date is to cancel the entire transaction and re-enter all information. · Be sure to follow-up on all rejected records. · Review the 30-day warning report and submit necessary records to book loans. · Always use the "as-of-date" (end date) for the current period even if you are reconciling items from a previous period. · Prior to sending in a reconciliation batch, make sure that all acknowledgements have been retrieved (imported) into your system. · Keep track of the names of the files that are included in each batch of loan origination records and disbursements. This will help if there is ever a need to re-create a batch. · Correct and re-transmit all rejected loan origination records, promissory notes and disbursement records as quickly as possible to avoid delays in processing loans. · Check your batch activity database for any unconfirmed batches. Import any missing acknowledgements. · If using EDExpress, remember to run the Measurement Tools Reports to determine unreconciled loan detail items. ---------------------------------------------------------------------------------------------------------------------- William D. Ford Direct Loan Program IMPORTANT NUMBERS TO REMEMBER: Student Financial Aid Programs Customer Service....................1-800-433-7327 FAX.........................................202-260-4199 Bulletin Board....................1-800-429-9933 Internet Address.........csb@sfa.ope.ed.gov · General inquiries from institution Federal Student Aid Information Center.................................1-800-4-FED-AID · Student inquiries · Working hours are from 8:00 am to 8:00 pm (EST) Department of Education Direct Loan Task Force.........................202-708-9951 FAX.........................................202-401-3424 · Program Development and Coordination · Working hours are from 8:00 am to 5:00 pm (EST) Department of Education Direct Loan Policy.................................202-708-9406 CPS and Direct Loan Customer Service.......................................1-800-330-5947 FAX.........................................319-339-6996 · All EDExpress software modules · Technical advice and EDExpress systems support · Working hours are from 7:00 am to 7:00 pm (CST) Title IV WAN Customer Service .................................................1-800-615-1189 FAX.......................................319-339-6983 · Enrollment forms for Title IV WAN · Distribution of Title IV WAN software · Network problems · Re-sending application batches · Password problems · Transmission errors Direct Loan Custom/Combo Technical Reference Support.......1-800-756-4220 · Mainframe technical issues and systems support National Computer Systems (NCS) User Services.......................1-800-553-2159 · Systems support for Title IV WAN software · Support for Monthly Electronic Expenditure Reporting System (MEERS) Loan Origination Center - School Relations ...............................1-800-848-0978 FAX.....................................1-800-848-0984 TDD.....................................1-800-848-0983 · Loan origination and disbursements · Acknowledgments · Promissory notes processing · School testing · Reconciliation issues · Standard origination processing · Bulk forms/publication ordering · Working hours are from 8:00 am to 4:00 pm (EST) Direct Loan Servicing Center - Borrower Services.....................1-800-848-0979 Delinquent Accounts/Collections..........1-800-848-0981 Direct Loan Consolidation....................1-800-848-0982 FAX..........................................................1-800-848-0984 TDD..........................................................1-800-848-0983 · Booked loans · Payments made and loan balance information · Deferments · Repayment options · Disability · Working hours are from 8:00 am to 8:30 pm (EST) National Student Loan Data System (NSLDS).............................1-800-999-8219 · Student Status Confirmation Reports (SSCR) · Borrower tracking · Financial Aid Transcripts · NSLDS User ID and password · Working hours are from 6:00 am to 6:00 pm (CST) DIRECT LOAN REGIONAL CLIENT ACCOUNT MANAGERS REGION I (MA, ME, NH, VT, RI, CT) Regional Director for Direct Loans--David Sola Address: J. W. McCormack P.O.C.H., Room 532, Boston, MA 02109 Phone: 617-223-4963 Fax: 617-223-4968 REGION II (NY, NJ, PR, VI) Regional Director for Direct Loans--Barbara Heisler Williams Address: 75 Park Place, 12th Floor, New York, NY 10007 Phone: 212-264-8012 Fax: 212-264-1666 REGION III (PA, MD, VA, WV, DE, DC) Regional Director for Direct Loans--Gary Smith Address: 3535 Market St., Room 2304, Philadelphia, PA 19104 Phone: 215-596-1716 Fax: 215-596-1726 REGION IV (GA, FL, AL, MS, TN, KY, SC, NC) Regional Director for Direct Loans--Connie Kaschub Address: 101 Marietta Tower, Room 909, Atlanta, GA 30323 Phone: 404-730-2012 Fax: 404-730-2078 REGION V (IL, WI, MI, IN, OH) Regional Director for Direct Loans--Kathy Rehorst Address: 111 N. Canal Street, Suite 830, Chicago, IL 60606 Phone: 312-886-8766 Fax: 312-886-6737 REGION VI (TX, OK, LA, AR, NM) Regional Director for Direct Loans--Don Kerr Address: 1200 Main Tower, Room 2150, Dallas, TX 75202 Phone: 214-767-9607 Fax: 214-767-9604 REGION VII (KS, MO, NE, IA) Regional Director for Direct Loans--Mark Walsh Address: 7505 Tiffany Springs Parkway, Suite 500, Kansas City, MO 64153-1367 Phone: 816-880-4090 Fax: 816-891-8713 REGION VIII (CO, WY, MT, UT, SD, ND, MN) Regional Director for Direct Loans--Mike Clark Address: 1801 California St., Suite 930, Denver, CO 80202-2610 Phone: 303-294-1393 Fax: 303-294-1399 REGION IX (CA, AZ, HI, NV) Regional Director for Direct Loans--Jim Castress Address: 50 United Nations Plaza, Room 121, San Francisco, CA 94102-4987 Phone: 415-437-8843 Fax: 415-437-8852 REGION X (WA, OR, ID, AK) Regional Director for Direct Loans--Barry Shine Address: 915 Second Ave., Room 3164, Seattle, WA 98174-1099 Phone: 206-220-4400 Fax: 206-220-4407 Telephone numbers and information provided are subject to change. |