Loan Purchase Commitment Program FAQ

Last Updated August 14, 2009
Most recent questions are italicized

The information presented in this Question and Answer (Q&A) format provides additional information on the new Loan Purchase Programs authorized by the "Ensuring Continued Access to Student Loans Act of 2008" (Pub. Law 110-227) (ECASLA). This set of Q&As relates to the Loan Purchase Commitment Program where the Department offers to purchase from FFEL Program lenders certain FFEL Program loans that were made for the 2008-2009 academic year. Q&As on the Loan Participation Purchase Program, where the Department offers to purchase "participation interests" in FFEL Program loans that were made for the 2008-2009 academic year, can be accessed from the home page of this website.

These Q&As supplement information provided in other documents on this website and through our series of webinars. This information is to be considered interpretive guidance provided by the Department for use with the Loan Participation Purchase Program. This document will be periodically updated, as needed.

NEW LOAN CONVERSION TRANSFER AND IMAGING COLLATERAL TRANSFER FILE

Q1 Why is the Department changing the layouts for these two files?

A1 The four servicers approached the Department and expressed a concern that they could potentially be requiring 4 separate file formats from Sellers/Servicers wishing to sell their loans to the Department. They proposed using the current ACS file format to develop one common format that could be used by all. While keeping the changes to a minimum, the Servicer workgroup made recommended changes that would benefit the borrower, seller/seller servicer, schools, and the Department.

Q2 What types of changes were made to the Loan Conversion Transfer file format?

A2 Loan Conversion Transfer File changes include

Q3 What types of changes were made to the Imaging Collateral Transfer file format?

A3 Imaging Collateral Transfer file changes include

Q4 When will the four new servicers be ready to coordinate testing with my organization?

A4 The four new servicers are currently ready to begin test coordination.

Q5 Who do I contact to begin test coordination?

A5 The contact information is listed below:

Sallie Mae Contact:

Todd Rieg

Todd.rieg@salliemae.com

Phone: 317-598-4112

Information needed from the Seller/Seller Servicer when contacting for testing:

Sallie Mae will provide a "welcome packet" that will walk-through the necessary information. This includes contact information, testing schedules, etc.

Additional Servicer Information for Seller/Seller Servicer Letters:

Payment Address:

Department of Education
P.O. Box 740351
Atlanta, GA 30374-0351

Payment Acceptance Date - Date of Sale

Correspondence Address:

Sallie Mae - Department of Education Loan Services
P.O. Box 9635
Wilkes-Barre, PA 18773-9635

Website: www.SallieMae.com

Servicer Phone Number: 800-722-1300


PHEAA Contact:

Adele Marsh, FedLoan Servicing (PHEAA)

Conversions@myfedloan.org

Phone: 717-720-2711

Information needed from the Seller/Seller Servicer when contacting for testing:

A "welcome" package containing the information you need is posted to the FedLoan Servicing website at www.myfedloan.org. Information items include Operations contact, Loan Transfer File Technical contact, Electronic Transmission contact, and Date Test File will be ready.

Additional Servicer Information for Seller/Seller Servicer Letters:

Payment Address:

Department of Education, FedLoan Servicing
P.O. Box 530210
Atlanta, GA 30353-0210

Payment Acceptance Date - Date of Sale

Correspondence Address:

FedLoan Servicing
P.O. Box 69184
Harrisburg, PA 17106-9184

Website: www.myfedloan.org

Servicer Phone Number: 800-699-2908


Great Lakes Contact:

Primary Contact:

Jeff Ross, Manager - ISD Servicing

608-246-1446

jross@glhec.org

Secondary Contact:

Kari LaFave, FSA Loan Conversions Coordinator

605-688-4379

Conversion Mailbox: GreatLakesFSALoanConversion@glhec.org

Information needed from the Seller/Seller Servicer when contacting for testing:

Great Lakes will work with each seller/servicer individually.

Additional Servicer Information for Seller/Seller Servicer Letters:

Payment Address:

Department of Education
P.O. Box 530229
Atlanta, GA 30353-0229

Payment Acceptance Date - Date of Sale

Correspondence Address:

Great Lakes Borrower Services Department
P.O. Box 7860
Madison, WI 53708-7860

Website: mygreatlakes.org

Servicer Phone Number: 800-236-4300 or 608-246-1700

Servicer Fax Number: 800-375-5288 or 608-246-1608


Nelnet Contact:

Becky Keith

303-696-5224

Becky.keith@nelnet.net

Information needed from the Seller/Seller Servicer when contacting for testing:

Nelnet needs the following information: Name of the contact person name, email, phone number, the Servicer loans will come from, if notice is from seller the PUT Program Type to test, test Loan Conversion Transfer File containing variety of loan types, a test Image file with both collateral and historical files, and the date of live transfer.

Additional Servicer Information for Seller/Seller Servicer Letters:

Payment Address:

Department of Education
P.O. Box 740283
Atlanta, GA 30374-0283

Payment Acceptance Date - Date of Sale

Correspondence Address:

P.O. Box 82561
Lincoln, NE 68501

Website: www.nelnet.com

Servicer Phone Number: 1-888-486-4722


Q6 I was listening in on the call this afternoon and have a question. I work from a software provider perspective for lenders/servicers that are currently PUTing loans in the current format. Will the lenders/servicers who continue to do PUTs need to be able to support both the current layout and the revised layout at the same time, or will there be a clean cut over? In other words, if a lender is assigned to one of the 4 new DOE Servicers after submitting a Notice Of Intent, is there a possibility that on a future NOI that they will get ACS again? I'm trying to determine if the lender will need two separate programs (the current one, and the new one), or if we can just make updates to the current one and have them start using it as soon as they are assigned one of the new servicers.

A6 The Department anticipates that once you are assigned one of the new servicers that you will only need to use the new file format moving forward.

Q7 This is the clarification you requested from NSLDS on the conference call regarding enrollment data. NSLDS questioned why there are limited values and a conditional requirement on the enrollment code field in the transfer file layout. The transfer layout shows that Enrollment Effective date is required, but the enrollment codes are conditional and limited to F (Full), H (Half) or Spaces. Today, NSLDS requires both enrollment code and effective date for reporting loans by the GA's. NSLDS accepts the following enrollment code values:
F - Full Time, H - Half time, L - Less than Half time, A - Approved Leave of Absence, W - Withdrawn, G - Graduated, D - Deceased, X - Never Attended, Z - No record Found

A7 Although the new Loan Conversion Transfer file only includes F, H, or spaces, the Servicers will be deriving the additional codes and providing them to NSDLS.

Q8 On the call today, I asked if the Image Transfer File changes are required. The response on the call was, "if you are going to use the new loan file transfer layout, then yes, you must use the updated image transfer file layout". That seems clear cut. However, if the lender works with the servicers to come up with their own transfer file layout or use an existing file layout that is already in place, can we continue to use the same specifications for the image transfer file as we've used with ACS if the servicer is willing to accept it? Or does the DOE require the changes be made for the image transfer file regardless of how the loan transfer file is done?

A8 The Department does not require a lender or servicer to use the new image transfer file, but agreement must be reached with the Department's new servicer(s) to accept a different file format.

Q9 ED expressed the preference that if one of the 4 new servicers currently services loans for a lender, then the lender's loans are likely to be assigned to that servicer when the loans are sold to ED. That final determination of assignment will be made by ED after receipt of the 45 day notice. And all loans in a sale will be assigned to the same servicer.

How will ED determine where loans are currently serviced in order to fulfill the preference to leave sold loans at one of the 4 new servicers when they are already servicing them? Nothing on the 45 day notice informs ED as to the servicing location of the loans included in the notice. And loans in a 45 day notice may in fact be serviced in several locations. The risk seems high that current servicers of the loans could end up having to transfer loans nonetheless.

A9 A 45 day notice can only contain one servicer in the loans being sold. Until a more permanent mechanism is put into place, the Department encourages the seller or seller/servicer to include the name of the current servicer in the email containing the 45 day notice.

Q10 With the addition of the 4 new Department Servicers, we have been asked questions regarding the Security Agreement for the Agreed Upon Procedures Engagement.

  1. Will the Audit Firm have to sign a Security Agreement with each of the Servicers?
  2. If a Security Agreement has already been signed with ACS for a prior AUP, will a new agreement be needed for the subsequent AUP for loans serviced at ACS?

A10 The answer to both questions 1 & 2 are "yes". The Audit firm will have to sign a Security Agreement with each of the Servicers and a new agreement will need to be signed with ACS for subsequent AUP audits for loans serviced at ACS.

Q11 Has the D2 Header Record been removed entirely from the new layout?

A11 Yes, the D2 Header record has been removed from the file layout.

Q12 The 4 new servicers are using this new format for the 9 day file, but did they also agree upon the edits that they will apply to the data in the file? Hopefully, the edits will be the same from one servicer to the next, so if we have a successful test with one, we should expect a successful test with another one with the same data. If they have common edits for the data in the file, could you also share that? It will make the testing process faster if we can anticipate problems before we start to trade files.

A12 Yes, the 4 new servicers will be using common edits for the Loan Conversion Transfer File. In addition to Loan Purchase Program edits, the additional common edits are listed below:

Q13 You mentioned emphatically that we cannot send "live" data as a test. What do you mean by that? Do you mean we need to scramble the SSN? Or change the name of the borrower to a fictitious name?

A13 You cannot use any live PII data that could be used by others to form a privacy breach to the student, parent, or borrower.

Q14 When we send the 9 day file, we do not set the loan status or the principal dollar amount at what it would be on the sale date. We provide the data as of the 9 day file. Most common status change activity has been a convert to repayment that would occur between 9 day file and sale date. This has not been a problem for ACS. Will this be for the 4 new servicers?

A14 No, the new servicers will not have any problem handling activity that occurs on the loan after the 9 day file cut-off. These pre-sale activities will be handled through the post-sale adjustment process.

Q15 Will we use the same transmission and encryption process for the 9 day file as we do today with ACS? Do you have transmission specifications from the 4 new servicers yet?

A15 We do not know if there will be differences in the transmission and encryption process, so you should direct the question to each servicer when coordinating your testing efforts. A list of the testing contacts is in A5.

Q16 In the Header Record there is a data field for Loan Count. How is this count different than Borrower Count? We currently tally every Record 1 as the count for Borrower Count. Would this not be the same for Loan Count?

A16 There should be one SSN per borrower and this will provide you with the unique borrower count. Tallying every Record 1 will provide you with the unique loan count.

Q17 In the Header Record there is a data field for Lien Holder - If there is no lien holder, we will leave this field blank - correct?

A17 Correct.

Q18 Record 03 - Clarification of the first field "Date of Prior Servicer's Earliest unpaid installment" and the new field "Next Payment Due Date":

A18 Correct.

Q19 First Due Date of Current repayment schedule - this is the first due date from the current disclosure?

A19 Correct.

Q20 Repayment Term 1 of Current Repayment schedule - is this the term that was established as of the current disclosure? It is not the remaining term left - correct?

A20 The only way that Repayment Term 1 would equal the remaining term left is if the loan has a level repayment schedule with equal payments throughout the entire term.

Q21 Repayment Term 2 of current Repayment schedule - for level schedules, sometimes the last payment amount is not the same as the monthly payment amount. Are you expecting this to be 1 and the final payment amount in Repayment Amount 2 - or will this be an error when we have indicated that the schedule is a level one?

A21 Yes, see A20 above.

Q22 Enrollment effective date - how is this different from the Record 01 Separation Date and Record 03 Separation Certification Date and the Record 07 School Loan Cert Date? Please provide explanations of each so we know how they are different.

A22 TBD

Q23 Post Sale - We currently have EXCEL spreadsheets that ACS has standardized for submission of payments and other information that comes to us and we will forward on to the new servicer. Will these post sale spreadsheets remain the same across all 4 new servicers?

A23 Yes.

Q24 Field 05 01 85 CHAR IBR Eligibility Indicator C Required if on an IBR Schedule "Y", "N" Indicator used to determine if loan is eligible for IBR. Under what condition(s) should the IBR Eligibility Indicator be to "Y"?

A24 The flag should be set to "Y" if the borrower is eligible for IBR. Please refer to the regulations for the specific eligibility criteria.

Q25 Field 05 03 128-130 CHAR Number of Qualifying Payments C Required if in Repayment Number of Qualifying Payments made to date. Does the Number of Qualifying Payments relate to the number of payments the borrower has made in total on the loan or the number of payments made during IBR?

A25 The number of number of qualifying payments made to date. Please refer to the regulations for further information.

Q26 Fields 08 07 207-213 NUM Unreported Capitalized Interest OID C 99999v99 - The amount of capitalized interest OID that ED Servicer will be responsible to report on 1098Es and 08 07 214-220 NUM Unreported Loan Origination Fee OID C 99999v99 - The amount of origination fee OID paid by the borrower that ED Servicer will be responsible to report on 1098Es. Previous conversations with ACS regarding the OID information led us to believe that it would not be needed if our organization was reporting OID for the borrowers for the period their loan was on our system in 2009. The software that we use for calculating OID does not break it out between Capitalized Interest and Loan Origination Fee. If the OID information must be split out, we will need you to supply us with a calculation or algorithm that we could apply to attain the desired results. Unfortunately, this may require manual processing on our part which will be burdensome. If we must supply the information, will the ED Servicer be reporting this on the 1098Es for this year?

A26 These fields would be needed only in the case where the ED Servicer needs to report the information on loans where your organization has not done the reporting.

Q27 Field 6 87-92 DATE Interest Accrued Thru Date R - The Date the interest is accrued thru. Our plan is to accrue interest through the creation date of the Conversion Transfer File. Will this be a problem?

A27 No.

Q28 For those fields that are now flagged "unused", are the NUM and DATE attributes still relevant? In other words, should "unused fields" still be populated as zeroes if the Data Type specifies NUM or DATE?

A28 These fields will be ignored, so you can either populate the field as you currently do or, if it has not been coded, leave it blank.

Q29 In the past, our image transfers to ACS only included prom notes and certifications. Can you confirm our future image files can continue to only contain these 2 types of documents and will only need to be updated to match the new format in the Image Transfer File specification version 2.2?? If yes, what document type is to be used for certifications? It is not listed in the specifications document.

A29 The Master Loan Sale Agreement (MLSA) specifies the collateral that must be provided to the ED servicer at purchase. Certifications can included in the servicing or correspondence history or you may continue to use the document type currently provided to ACS, if the new servicer agrees and can accept that document type.

Q30 If we are now required to submit more types of documents, EA #50 talks about including an image of payment and collection history. Wouldn't this information be included in the loan transfer data file? Specifically what data and in what format does the department require for imaged payment and collection history if it is truly intended to be imaged and not included in the loan transfer data file?

A30 Other entities in the industry are using the guaranty agency claim package format to create payment and collection histories that are then imaged and forwarded with the Image Collateral Transfer file.

Q31 If we are required to provide images of correspondence, what correspondence is required? Does this include letters, emails, text messages, and notes on the borrower's account? If so, and the correspondence cannot be directly associated to a specific loan, does the department still want the correspondence? For example, a borrower may have called to inquire about several loans (both private and FFEL) and a note is entered on their account at the borrower level.....not the loan level. Does the department want this data sent regardless of whether it can be associated to the specific loan being sold?

A31 The Master Loan Sale Agreement (MLSA) specifies the collateral that must be provided to the ED servicer at purchase.

Q32 EZ27TransferFile_Layout_version2. On record 4: Current Due - Should Current Due include the Partial Due Amount, or not?

A32 Yes, it should include the Partial Due Amount.

Q33 Record 05 - IBR Create Date ... What does this represent exactly - Is it the Start Date of the IBR?

A33 Yes, it is the date that begins the 25 year "count down".

Q34 Record 03 - Repayment Term 1 of Current Schedule (and Term 2, etc.) - Is this the schedule the borrower is currently in or should it reflect the schedule over the life of the loan?

A34 It is the schedule that the borrower is currently in.

Q35 Are the new "Unused" fields supposed to be treated as filler and left as spaces?

A35 Yes

Q36 Will the edits for ACS match the edits by the additional Servicers?

A36 The edits may be similar but they are probably not the exact same edits listed in A12.

Q37 "Servicer Code"...Page 5 & 6 of format V2.2 doc...is that Servicer code supposed to be the ED servicer that the PUT is going to or is it the servicer the loans are coming from?

A37 This code refers to the servicer that the loans are coming from.

Q38 For multiple pdf docs that pertain to one loan, is the expectation that those individual documents will be indexed together in some sort of sequence such as:

Borrower 1, Doc A
Borrower 1, Doc B
Borrower 1, Doc C
Borrower 2, Doc A
Borrower 2, Doc B
Borrower 2, Doc C
etc.

A38 No, the expectation is not to index the documents as described above.

Q39 Is it acceptable to continue to send separate transmissions for the groups of documents. (One transmission for P-notes, one transmission for loan histories, one transmission for disclosures)?

A39 Yes, this is acceptable.

Q40 What is the difference between the "Disbursement Number" versus the "Disbursement Segment" and can you provide examples?

A40 Yes, please see below:

Disbursement Number: Sequential numbering of disbursements being sent for this loan; used to link the disbursement level records together; not necessarily the same as disbursement segment.

Disbursement Segment: Disbursement number for multiply disbursed loans (first, second, third etc disbursement of the loan).

Scenario 1: A loan has three disbursements: 8/20/09 (Fall), 12/20/09 (Winter), and 4/20/10 (Spring). In the Loan Transfer File, the 8/20/09 records are first, the 12/20/09 records are second, and the 4/20/10 records are third.

Disbursement Date Record 07 Disbursement Number Record 08 Disbursement Number Disbursement Segment
8/20/09 01 01 01
12/20/09 02 02 02
4/20/10 03 03 03

Scenario 2: A loan has three disbursements: 8/20/09 (Fall), 8/25/09 (Summer), and 1/14/10 (Spring). In the Loan Transfer File, the 8/25/09 records are first, the 8/20/09 records are second, and the 1/14//10 records are third.

Disbursement Date Record 07 Disbursement Number Record 08 Disbursement Number Disbursement Segment
8/25/09 01 01 02
8/20/09 02 02 01
1/14/09 03 03 03

Q41 Can you please provide examples of how to properly populate the fields related to graduate repayment schedules?

A41 Yes, please see below:

Graduated repayment with a Conversion Date (day 0) of 7/15/2009.

Scenario #1

Field Name Record/Starting Position Value
First Payment Due Date 03/95 5/1/2007
Repayment Plan Term 1 03/101 12
Repayment Plan Amount 1 03/104 $25.00
Repayment Plan Term 2 03/111 12
Repayment Plan Amount 2 03/114 $40.00
Repayment Plan Term 3 03/121 24
Repayment Plan Amount 3 03/124 $50.00
Date of Prior Servicers Earliest Unpaid Installment 03/03 8/1/2009
Next Payment Due Date 03/81 8/1/2009

The repayment schedule would be loaded with a first gradation begin date of 5/1/2007 in the amount of $25.00. The second gradation would have a begin date of 5/1/2008 in the amount of $40.00. The third gradation would have a begin date of 5/1/2009 in the amount of $50.00. The loan would be loaded with a next due of 8/1/2009 in the amount of $50.00.

Scenario #2a

Field Name Record/Starting Position Value
First Payment Due Date 03/95 5/1/2007
Repayment Plan Term 1 03/101 12
Repayment Plan Amount 1 03/104 $25.00
Repayment Plan Term 2 03/111 12
Repayment Plan Amount 2 03/114 $40.00
Repayment Plan Term 3 03/121 24
Repayment Plan Amount 3 03/124 $50.00
Date of Prior Servicers Earliest Unpaid Installment 03/03 4/1/2009
Next Payment Due Date 03/81 8/1/2009

The repayment schedule would load the same as above. The loan would be loaded with a next due of 8/1/2009. The system would build all of the bills. The bills would be 4/1/2009 - $40.00, 5/1/2009 - $50.00, 6/1/2009 - $50.00, 7/1/2009 - $50.00, 8/1/2009 - $50.00. Total past due would equal $190.00 and the Monthly Payment Amount would equal $50.00 for a Current Due of $240.00.

Scenario #2b

If the borrower was granted a deferment from 5/1/2009-6/30/2009, the loan would be loaded with a next due of 8/1/2009. The system would build all of the bills. The bills would be 4/1/2009 - $40.00, 7/1/2009 - $50.00, 8/1/2009 - $50.00. Total past due would equal $90.00 and Monthly Payment Amount would equal $50.00 for a Current Due of $140.00.

Q43: Will the Loan Detail Schedule, as specified by ACS, be used by the other servicers? Can we expect to receive this file in both .pdf and XCEL formats?

A43: Yes and you can expect both formats.

Q44: If filing for Notices of Intent is being extended to 8/31, does this mean that the closeout of Year 1 Participation will be extended into October?

A44: See Electronic Announcement #71

Q45: Record D1 (70-77) � Current Owner. Should this be our agency�s LID or the custodian�s LID?

A45: This should be the seller�s LID.

Q46: Record 03 (89-94) � Next Payment Due Date. If reporting on the 25th of the month and the due date was the 15th of that same month (the borrower was a few days past due) what would be reported in this field?

A46: You would report the 15th of the next month.

Q47: Record 03 (101-160) � Repayment Term fields. Please verify that the Repayment Term fields apply to all repayment types (i.e. IBR, graduated schedule, standard schedule)

A47: Yes

Q48: Record 05 (63-71) � Gradation Factor (9999v99999). How would a Gradation Factor of 15% be reflected in this field?

A48: It should be reflected as 000015000

Q49: Record 05 (110-115) � Forgiveness Start Date. Can be based on three different scenarios (i.e. IBR Start Date, 1st Economic Hardship on or after 7/1/09 or 1st Payment on or after 7/1/09 that is >= Standard Standard Payment Amount). Does this mean that we must calculate the Standard-Standard Payment Amount for every loan being PUT?

A49: You would only need to calculate the Standard-Standard Payment Amount for borrowers that are on an IBR.

Q50: Record 07 (17-24) � Note Amount. The first row in the mapping document for Record 07 indicates that we should only be reporting on disbursed disbursements. (i.e. �Do not send records for amounts cancelled prior to disbursement�). It also indicates that we should be reporting one record for each of those disbursements.

Note Amount, which falls in Record 07, seems to be looking for information that would sum up amounts for all disbursements for the loan. If all disbursements were to be included, would it then include undisbursed cancelled disbursements? If so, we would not ordinarily be reporting these in the file. Does this cause present any problems?
Also, would the value be the same for all 07 records (it appears that it would)?

A50: The Note Amount should be the total amount of actual disbursements and not include undisbursed cancelled disbursements.

Q51: Record 07 (71-72) - Bond Identifier Code. Can you explain what value should be populated in this field?

A51: This field is not used so you can populate it as you do now or not populate it at all.

Q52: Record 07 (161-162) - Fully Disbursed Indicator. Specifies the following in the mapping document: C = Fully disbursed by Cancellation, F = Fully Disbursed, P = Partially disbursed (As loans must be fully disbursed, P will not be a valid value). Is this field at the disbursement level? What about disbursements that were partially cancelled?

A52: Partially cancelled loans prior to the sale should be flagged as F � Fully Disbursed.

Q53: We note that there is no place in the file to report Military Grace. Was this intentional?

A53: No, this was an oversight. The file layout will be updated to add Military Grace begin and end dates to the 02 record.

Q54: Follow-up on Q33/A33 - Wouldn't this be the same as the Forgiveness Start Date? Why are there two fields with the same data being reported?

(Q33: Record 05 - IBR Create Date ... What does this represent exactly - Is it the Start Date of the IBR? A33: Yes, it is the date that begins the 25 year �count down�).

A54: The answer to Q33 has been revised as follows:
The Forgiveness Start Date is the date that begins the 25 year count down and it is the date of the first qualifying IBR payment or the date of the first economic hardship on or after repayment begins. The IBR Create Date is the date that the IBR Repayment Plan begins.

Q55: Follow-up Q26/A26 � With respect to Question 26 of the Q&A, we take this to mean that if the current servicer will be reporting the 1098-e information for payments it has received, we do not need to populate the OID fields. Is this correct?

A55: These fields are needed if there is information that the ED Servicer needs to report unreported information. The workgroup�s understanding is that this information is split out for claims purposes on the claims filing form. If you currently have a method for reporting the information to the guaranty agency at the point of claims filing, then this method would also be acceptable for reportingthe information to the ED Loan Servicer.

Q56: The image transfer file requirements request the disclosure as one of the documents. Is this the disbursement disclosure or the repayment disclosure.

A56: This means any type of disclosure.

Q57: On page 7, the valid document types are listed. Deferment, forbearance and correspondence are listed as document types. This refers to an image of the physical deferment form, forbearance form or letter or other correspondence. Correct? You are not asking us to take the history information (which may be simply comments in our servicing history) of these type of events. Correct?

A57: Correct.

Q58: We have only been providing the promissory note as the image documentation, and then our �claim package� information as the history file. We have not supplied any other documentation, as this has met the requirements in the past. Is this still correct? We will plan on two files � one for �NOTE� and the other �PHST�. This appears to be a valid option for the new format. Correct?

A58: Correct.

Q59: The Security Agreements entered into earlier were tri-party agreements between ED, the lender, and the auditor. The servicer (ACS) was not a party to the agreement although they are ED�s agent. In answer #1, can you clarify whether the Auditor and lender will be required to enter into an agreement with the servicers themselves, or will they enter into 4 new Security Agreements with ED covering each of the additional ED servicers?

A59: The 4 new security agreements will be between ED, the lender, and the auditor.

Q60: The current Security Agreement covering the servicing done by ACS on behalf of ED has a one year term from date of its execution by ED. In answer # 2 below, will a new agreement be required to be executed between the Auditor, lender, and ED only for those AUPs performed subsequent to the expiration of the one year term of the current Agreement? If not, what is the specific date after which AUPs for loans serviced by ACS will require a new Security Agreement?

A60: We will require a new security agreement after the one year term of the existing agreement expires.

Q61: What disclosures are being included in the requirement of sending disclosures to servicers?

A61: Any disclosure related to the loan.

Q62: Due diligence only requires that messaging be made reflecting that disclosures went out and does not require the document � will copies of the messaging be sufficient for servicers?

A62: Yes.

Q63: In what format should disclosure messaging be sent?

A63: No specific format has been identified. There needs to be a file for every loan.

Q64: I am still having trouble with Table 4. I realize it is independent of the months of deferments in Record 02. However, we have more deferment types defined on our system than Table 4 provides. I still need to understand which Table 4 Deferment Type Definition I use when I have a deferment of the following:
Public Health deferment
Vista deferment
Internship deferment
Tax Exempt deferment
Disability deferment
Motherhood deferment
Parental Leave deferment
Teacher deferment

A64: These additional deferment types have been added to the Loan Conversion Transfer File layout.

Q65: What if the loan has more than 6 repayment terms schedules? Record 03 only provides spaces for up to 6 repayment term schedules.

A65: You will need to work with the Servicer(s) to address the additional terms.

Q66: Are IBR fields in Record 05 at the Loan Level?

A66: Yes

Q67: Is Record 05 'Forgiveness Start Date' definition = either (Grace End Dt + 1 day) or 7/1/09 whichever is later? Or is there another definition for this field? Why is it necessary to have a field with this value if the definition is one of the 2 values above?

A67: Please see A33 & A54.

Q68: For the imaging file, just want to confirm that fields that are not required are still needed in the index file and denoted by two consecutive || characters. For example: 123456789|Smith|John|note||07/01/2009|PLUS|07/01/2005|07/29/2009|12345|somefilename.zip

In the example above, the commonline field is not being populated and therefore is blank denoted by the two consecutive pipe symbols.

A68: Yes, that is correct.

Q69: Is the endorser Addendum document type supposed to be in the collateral file or the post sale file?

A69: This should be in the collateral file.

Q70: We are a lender that currently sends a letter to the borrower when the loan is sold. We have a sentence that reads: Your federal students loans listed below have been sold to the Department of Education, and will be serviced by:

  • The Servicer Name is listed as: Department Of Education Student Loan Servicing Center
  • Our assumption is this would be the same for each of the 4 servicers so would not need to be variable. Correct us if that is an invalid assumption and please provide exactly what would be listed for each servicer.

A70a: Correct

We also list a servicer contact address in the letter. In the Q&A document � there were generally two contact addresses listed for each servicer. One address for payments and one for correspondence. Changing our letter to list two addresses cannot be done withinthe short timeframe. Which address would the servicer�s prefer the lender list on the letter?

A70b: The payment address.

Q71: Deal Number: How soon after the 45 day notice is filed will the Deal Number be assigned? How will the lender be notified of this number?

A71: Deal number will be assigned by the servicer upon receipt of the 45 day notice from the Department. The servicer will communicate the deal number during initial contact regarding the sale.

Q72: Record 03 Remaining Loan Term (86-88): Says required if the loan is in repayment. If the loan has entered repayment, but is now in deferment or forbearance, this field would be left blank, correct?

A72: Correct.

Q73: Record 03 Next Payment Due Date (89-94): Says required if the loan is in repayment. If the loan has entered repayment, but is now in deferment or forbearance, this field would be left blank, correct?

A73: Correct.

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Last updated/reviewed August 14, 2009

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