Campus Partners Update Newsletter
May 1, 2009
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Inside Campus Partners Frances Johnson
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Highlights of the President’s 2010 Budget
The Department of Education has launched a new Web site publicizing the President’s FY 2010 Budget proposal and its impact on the student financial assistance programs. This site summarizes relevant provisions of the budget proposal that affect federal student assistance programs, answers frequently asked questions about the provision, and provides links to related sites. One of the Q&A’s includes information specific to the Perkins Loan Program. ED will update the site as more information on the President’s 2010 Budget proposal becomes available. To view this Web site, go to: http://www.ed.gov/about/overview/budget/budget10/finaid/index.html.
Possible Changes to Economic Hardship Deferment
Campus Partners has heard from many customers who are concerned that the economic hardship deferment has been eliminated. The economic hardship provision in section 674.34(e) has not been eliminated, although one of the categories outlined in (e) (5) will be eliminated effective July 1, 2009.
The College Cost Reduction and Access Act made the following changes to economic hardship. This information is excerpted from Dear Colleague Letter GENFP-08-01:
In addition, the CCRAA eliminates the provision of the HEA under which a borrower could be considered to have an economic hardship if the borrower was working full-time and had a Federal educational debt burden that equaled or exceeded 20 percent of the borrower’s adjusted gross income. However, the CCRAA did not eliminate the Secretary’s authority to establish, by regulation, additional criteria for an economic hardship deferment based on the borrower’s income and debt-to-income ratio. Accordingly, until the Department issues new regulations to implement the CCRAA, the regulations at 34 CFR 674.34(e) (4) and (5) and 682.210(s) (6) (IV) and (v) that establish an income and debt-to-income criteria for the economic hardship deferment remain in effect. The applicable poverty line standard for purposes of these regulatory provisions, however, is the new poverty line standard (150 percent of the poverty line applicable to the borrower’s family size).
Campus Partners also confirmed this change with a representative of the Department of Education, who wrote:
“Yes, this change will affect Perkins Loans as well as FFEL loans. Basically, we would remove the 20/220 economic hardship deferment category from the Perkins regs [Section 674.34(e) (5)]. The change would be effective July 1, 2009 if we follow our common practice, borrowers applying for economic hardship deferments on or after July 1, 2009 would not be able to qualify for the deferment under the 20/220 criteria. Borrowers who are in an economic hardship deferment that began prior to July 1, 2009 would continue in that status for one year after the beginning of the deferment period. However, after the 12-month deferment period ends, they would not be able to re-apply for an economic hardship deferment under that category.”
According to one official at the Office of Post Secondary Education, cost would be a factor if the hardship provision was allowed to continue beyond July 2009.
Keep in mind that these provisions are subject to change based on negotiated rulemaking. We are not planning to change our current Application for Hardship/Unemployment until we know what the final impact will be to Federal Perkins loans. The Department is tentatively scheduled to publish a Notice of Proposed Rulemaking in August with final regulations being published on November 1, 2009. We will keep you updated on this and any other changes to the Federal Perkins program.
Federal Perkins Master Promissory Note (MPN)
The revised Federal Perkins Master Promissory Note is now available for comment. You can access this information from ED’s Information Collection System. To view the document, go to http://edicsweb.ed.gov, select the “Browse Pending Collections” link, and click link number 4005. Interested parties are invited to submit comments on or before June 8, 2009. You may view this Federal Register Notice at
http://edocket.access.gpo.gov/2009/pdf/E9-8119.pdf.
Federal Perkins Assignment Form
The new Federal Perkins Assignment form is also available for comment. Go to
http://edicsweb.ed.gov select “Browse Pending Collections” and click link number
4009. When you access the information, click on “Download Attachments” to view. Comments are due on or before June 15, 2009.
Addendum to Perkins MPN to Be Required
Based on previous guidance we received from the Department of Education, we told you in our December 1, 2008 Campus Partners Update that ED would require schools to send an Addendum to the Federal Perkins promissory note to their borrowers. In a follow up email to ED, we again have confirmed that ED will publish a Dear Colleague Letter, requiring schools to send an Addendum to borrowers who have already signed a MPN. From ED:
“I can’t give you a timeframe at this point as to when a Dear Colleague Letter providing an addendum to the Perkins MPN will be available, but we will be developing an MPN addendum to reflect the new statutory and regulatory requirements affecting the Perkins Loan program.”
New Federal Perkins Fact Sheet and Expanded Cancellation Provisions
As published in our December 1, 2008 Campus Partners Update, Campus Partners has updated the Federal Perkins Fact Sheet (Form 4884) that many of you use during exit interviews. These updates include changes to rehabilitation and the new cancellation benefits that are available to your borrowers.
We have also added a new form to our Web site called Expanded Cancellation Benefits (Form 9171) that lists the new cancellation benefits made effective August 14, 2008 under the Higher Education Opportunity Act (HEOA).
The Fact Sheet is available at
http://www.campuspartners.com/documents/4884FactSheet.pdf and the Expanded Cancellation Benefits form is available at http://www.campuspartners.com/documents/P9171.pdf.
Borrowers can view and download these forms from http://www.mycampusloan.com.
FSA Handbook – Volume 2 – School Eligibility and Operations
Volume 2 - School Eligibility and Operations of the 2009-2010 FSA Handbook is now available and is presented as a separate PDF File. This volume discusses the three types of institutions eligible to participate in the FSA programs, how to apply to participate in the FSA programs, general participation requirements, and much more. You may access this Volume of the Handbook by clicking on the following link: http://ifap.ed.gov/fsahandbook/0910FSAHbkVol2.html.
Regulatory Wisdom from Sharon Cameron Question: In addition to the changes to the economic hardship deferment for Perkins loans that may be effective July 1, 2009, what about the Income-Based Repayment program (IBR). Does the IBR apply to Federal Perkins loan borrowers? Answer from ED: No. Please refer to a new web site that is available for borrowers at http://www.ibrinfo.org. Income Based Repayment is available to borrowers with Direct and FFEL loans and not Perkins. |
Exit Interview Packages Changes
Campus Partners will be enhancing our exit interview packages by mid September to make the loan Disclosure Statement more user friendly for the borrower. We will be providing the Disclosure Statement as two individual documents on standard 8.5 by 11 inch paper. Each Disclosure Statement will continue to have a label with the borrower’s name and address affixed to it, which can be used to mail the exit interview to the borrower. While many borrowers attend group or individual exit interview sessions, most schools send the interview packages to borrowers who do not attend in-person interviews. Borrowers will be instructed to sign and return one copy of the Disclosure Statement to their school and keep the other for their records.
The Loan Interview form, which provides sections for borrowers to update their personal contact information and provide references, will be supplied as a separate document. The form will be printed on NCR (carbonless) paper with a glue strip on the top. If the form is mailed as part of the exit interview package, borrowers will be instructed to tear of the top sheet of the form and return it to their school, along with the Disclosure Statement.
There are not any other changes to the exit packages. Fact sheets and the mycampusloan.com insert will still be provided to the school to distribute to the borrower.
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Student Loan Default Rate Rising
Recent articles appearing in the Wall Street Journal and NAASFA Web site report that the default rates for federally guaranteed loans (FFELP and Direct Loans) are rising at an alarming rate. These articles cite recent figures released by the Department of Education that project a 6.9% default rate for fiscal year 2007, as compared to a 4.6% default rate in 2005. These figures reflect borrowers who began repaying their loans between October 1, 2006 and September 30, 2007, and who defaulted on or before September 30, 2008.
The Wall Street Journal article, entitled “Student Loans: Default Rates Are Soaring” also details the growing number of borrowers defaulting on private loans. According to the article, some private lenders have written off almost double the number of loans in 2008 as in 2006. Based on these articles, you are very likely to see higher cohort default rates for Perkins loans when figures are released for the 2007 cohort year. As a Perkins loan administrator, you are probably only too aware of the increase in defaults among your borrowers.
Campus Partners is receiving a large increase in the number of borrowers calling our office because they cannot pay their student loan bills. We are regularly advising them of deferment, forbearance, and cancellation options, resulting in an increase in the number of forms received for processing by our office. We continue to be totally committed to helping both you and your borrowers through this difficult time.
Our third-party audit for the fiscal year ending June 30, 2009 is currently underway. The audit is being conducted by Porter Keadle Moore, LLP. Requests for our audit will be fulfilled in mid-August. All loan types, including Perkins, HHS governed, and Institutional, will be included in the testing of loans selected by PKM.
An Audit Report Request Form is available on our Web site. Please stay tuned to the Campus Partners Update for more information.
Attachment: Audit Request Form
Get Ready for Year-End Processing
June 30, 2008 is two months away, but it is not too early to start planning for year-end processing. Use this checklist to help close the fiscal year successfully:
Reconcile loan and accounting information.
· Reconcile all disbursements for the year.
· Correct and return all unpostable new loans and advances.
· Check and update separation dates.
· Reconcile your general ledger.
Determine special needs and communicate them to us.
· Contact your auditors to determine the reports they need.
· Submit change/adjustment requests for processing.
Work the Cohort Default Rate Report.
· Provide your Customer Service Representative with requests for coding changes.
As the end of the fiscal year approaches, our goal is to process all Customer Service requests in a timely manner. All requests are processed in the order that we receive them, whether they arrive via regular mail, overnight mail, fax, DataLink Dispatch, or e-mail.
Important Year-End Processing Deadlines
June 5 Requests for duplicate reports
June 19 Requests for Change/Adjustment memos
June 26 Year-end post begins
Remember, you can use eXpressReports to access your fiscal year-end reports immediately following year-end processing. This Internet tool provides you with the fastest method of receiving your year-end information. Our Customer Service team can assist you with creating any special report that you need using myReports, our ad hoc reporting tool.
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”As always, thank you for your help. The staff at Campus Partners have always provided prompt, courteous assistance to me concerning the Federal Perkins Loan Program.”
Cindy Colbert |
The next session of Student Loans 101 will be presented on July 9-10. This workshop is designed for less experienced student loan administrators or those who are new to the Campus Partners system. Participants will gain hands-on experience at individual workstations in the newly renovated training room
Student Loans 101: July 9-10
Time: Day One: 8:30 AM- 4:00 PM Day Two: 8:30 AM - 1:00 PM
To register, fax a completed registration form to Debra Pitts at 336-607-2025.
Attachment:Student Loan 101 Registration Form
To register, fax a completed registration form to Debra Pitts at 336-607-2025.
Sign up for Web Conferences !
Please join us for our next Web conference, The Borrower Experience, scheduled for May 14 from 2:00 to 3:30 Eastern. You may contact Debra Pitts at dpitts@campuspartners.com to register for this Web conference or any training event.
To register for one or more training events, please contact Debra Pitts at dpitts@campuspartners.com.
2009 Web Conference Schedule
| Topic | Date |
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The Borrower Experience |
Thursday, May 14 2:00 to 3:30 Eastern |
FISCOP Reporting |
Thursday, June 11 2:00 to 3:30 Eastern |
Cohort: What is it and How Do I Manage it? |
Thursday, August 13 2:00 to 3:30 Eastern |
Where do I start? A Month to Month Guide |
Thursday, September 10 2:00 to 3:30 Eastern |
Open |
Thursday, October 8 2:00 to 3:30 Eastern |
Regulations Update |
Thursday, November 12 2:00 to 3:30 Eastern |
Tips for Managing Delinquencies |
Thursday, December 10 2:00 to 3:30 Eastern |
Campus Partners staff will attend the following conferences during the first six months of 2009.
KASRO will present its Spring Meeting on May 6-8 at Barren River State Resort Park, KY. More details are available at http://www.kasro.net.
The 2009 Western Student Financial Services Conference will be held July 19-22 at the LaSells Steward Center at Oregon State University in Corvallis, OR. For more details, please visit http://oregonstate.edu/conferences/pac10/index.html.
COHEAO will hold their mid-year conference in Philadelphia, PA on August 1-4. We will provide more information as it becomes available. COHEAO’s Web address is http://www.coheao.org.
Williams & Fudge will hold its Student Loans and Receivables Collection Conference on September 20-23 at the Hilton Mrytle Beach Resort. For more information, go to http://www.wfcorp.com/news/upcoming.html.
The Texas Bursars for Universities and Colleges will host the Texas BUC$ Conference at the Omni Bay Front Hotel on Oct. 11-14 at Corpus Christi, TX. More details are available at http://texasbucs.com.
The Minnnesota Collection Network will present its Mega Conference XVII on Oct 19-21 at the Sheraton Bloomington in Bloomington, MN. More information is available at http://www.mnnetwork.org/.
Cutoff dates for April, May, June, and July are presented below:
Transaction
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Apr. 2009 |
May 2009 |
June2009 |
July 2009 |
|---|---|---|---|---|
Last day to receive collection payments |
4/27 |
5/26 |
6/23 |
7/28 |
Last day to receive regular payments |
4/28 |
5/27 |
6/24 |
7/29 |
Last day for online payments |
5/01 |
5/29 |
6/26 |
7/31 |
Date final post begins |
5/01 |
5/29 |
6/26 |
7/31 |
Report date used for final post |
4/30 |
5/31 |
6/30 |
7/31 |
Last day deposits created for deposit to bank account |
4/30 |
5/29 |
6/26 |
7/31 |
2009 Cutoff Dates
Month |
Last day to receive collection payments |
Last day to receive regular payments |
Last day for on-line payments |
Date final post begins |
Report date used for final post |
Last day deposits created for deposit to bank account |
December 2008 |
12/26/2008 |
12/29/2008 |
1/2/2009 |
1/2/2009 |
12/31/2008 |
12/31/2008 |
January 2009 |
01/27/2009 |
01/28/2009 |
01/30/2009 |
01/30/2009 |
01/31/2009 |
01/30/2009 |
February 2009 |
02/24/2009 |
02/25/2009 |
02/27/2009 |
02/27/2009 |
02/28/2009 |
02/27/2009 |
March 2009 |
03/24/2009 |
03/25/2009 |
03/27/2009 |
03/27/2009 |
03/31/2009 |
03/27/2009 |
April 2009 |
04/27/2009 |
04/28/2009 |
05/01/2009 |
05/01/2009 |
04/30/2009 |
04/30/2009 |
May 2009 |
05/26/2009 |
05/27/2009 |
05/29/2009 |
05/29/2009 |
05/31/2009 |
05/29/2009 |
June 2009 |
06/23/2009 |
06/24/2009 |
06/26/2009 |
06/26/2009 |
06/30/2009 |
06/26/2009 |
July 2009 |
07/28/2009 |
07/29/2009 |
07/31/2009 |
07/31/2009 |
07/31/2009 |
07/31/2009 |
August 2009 |
08/25/2009 |
08/26/2009 |
08/28/2009 |
08/28/2009 |
08/31/2009 |
08/28/2009 |
September 2009 |
09/25/2009 |
09/28/2009 |
10/2/2009 |
10/2/2009 |
09/30/2009 |
09/30/2009 |
October 2009 |
10/27/2009 |
10/28/2009 |
10/30/2009 |
10/30/2009 |
10/31/2009 |
10/30/2009 |
November 2009 |
11/20/2009 |
11/23/2009 |
11/25/2009 |
11/27/2009 |
11/30/2009 |
11/25/2009 |
December 2009 |
12/28/2009 |
12/29/2009 |
12/31/2009 |
12/31/2009 |
12/31/2009 |
12/31/2009 |
January 2010 |
01/26/2010 |
01/27/2010 |
01/29/2009 |
01/29/2009 |
01/31/2009 |
01/29/2009 |
