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Put Process and Servicing Federally Held Loans. Agenda. Put Loan Overview Put Process Timeline School Resources Questions. Put Loan Overview. Put Loan Background. 2007: Lender difficulty creating new loans College Cost Reduction Access Act (CCRAA) National credit crisis - PowerPoint PPT Presentation
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Put Process and Servicing Federally Held Loans
Agenda
• Put Loan Overview
• Put Process Timeline
• School Resources
• Questions
Put Loan Overview
Put Loan Background
• 2007: Lender difficulty creating new loans– College Cost Reduction Access Act (CCRAA)– National credit crisis
• Ensuring Continued Access to Student Loans Act (ECASLA) – May 2008– Put Program – Temp authority to purchase– Created a secondary market for lenders
Put Loan Process Overview
• Lenders sell FFELP loans to the U.S. Department of Education (ED)– If fully disbursed prior to
September 30 of that year– Falls within eligibility dates
• When loan is sold:– Remains true to the MPN– Still classified as a FFELP loan– FFELP guaranty no longer exists– Owned and serviced by ED
Eligibility Dates
• ECASLA I (08-09)– First disbursement is on or after 05/01/2008
but before 07/01/2009– Loan is fully disbursed by 09/30/2009– Academic period for the loan includes
07/01/2008 or begins after 07/01/2008
Eligibility Dates
• ECASLA II (09-10)– First disbursement is on or after 05/01/2009
but before 07/01/2010– Loan is fully disbursed by 09/30/2010– Academic period for the loan includes
07/01/2009 or begins after 07/01/2009
Program Scope
• According to SLA analysis, over 85% of FFELP loans will be sold to Department– Based on Department data published
September 15, 2009• $20.1 billion sold to the Department• Additional $30.3 billion to be sold in next 45 days• $50.4 in total sales to Department of
Education figures
Program Scope
– Total FFELP $58.7 billion– Consistent with recently released Department
of Education figures
• Source: Student Lending Analytics Blog Posted September 20, 2009• http://studentlendinganalytics.typepad.com/student_lending_analytics/
Put Servicers
• ECASLA I: ACS
• ECASLA II: Four additional servicers
- Great Lakes Higher Education
– AES/PHEAA– Nelnet– Sallie Mae
Put Process Timeline
Put Process Timeline
• Day 45 – Day 10: Start Put Process
• Day 9: Adjustment Cutoff Date
• Day 0: Anticipated Put Date
Put Process Timeline
• Day 45 – Day 10– GL is assigned Notice from ED
• We contact seller to discuss details of sale
– Lenders not required to notify schools of loans identified for sale
Put Process Timeline
• Day 45 - 10: Changes Allowed– All changes are still possible during this time
• Changes processed same as any other FFELP loan• Original service provider should be able to process
changes sent which do not contain errors
-Grade Level-LP Begin & End Dates (not outside of Put criteria)
-Reinstatements -Reissues-Loan Increases-Additional Disbursements-Reallocations-Refunds
-Refund Reversals(only for correcting mistakes)
▪returned in error▪returned to wrong account
Electronic Manual
Put Process Timeline
• Day 9 - 1: Adjustment Cutoff Date (Day 9)– Current Servicer sends loan transfer file to GL
(as ED Put Servicer)– Work w/seller & current servicer to resolve
discrepancies– Once loans are verified, GL receives Bill of
Sale from selling lender• Bill of Sale is official document that
transfers ownership to ED
Put Process Timeline
• Day 9 – 1: Changes Restricted– Some Change Transactions CANNOT be performed
on or after Adjustment Cutoff Date (Day 9)
ALLOWED:-Grade Level-LP Begin & End Dates (not outside of Put criteria)
-Refund Reversals (only for correcting mistakes)
-Reallocations-Refunds
NOT ALLOWED:-Reinstatements -Reissues-Loan Increases-Additional Disbursements
Electronic
Manual
Put Process Timeline
• Day 0: Anticipated Put Date– Date the loan is scheduled to be transferred
to ED (Put Servicer)– Our system sends CL notification to schools
• Informing them of transfer• Letting them know to communicate with GL as
servicer– With the exception of ELM
Put Process Timeline
• Day 0 & Beyond: Changes Limited– From this point on, changes cannot be processed by original
service provider– We send CL response confirmation when schools submit
allowable change transactions for processing
ALLOWED:-Grade Level-LP Begin & End Dates (not outside of Put criteria)-Refund Reversals (only for correcting mistakes)
-Reallocations (both loan types must be Put & already exist w/same disbursement dates. Need to have same unique IDs to process electronically)-Refunds
NOT ALLOWED:-Reinstatements -Reissues-Loan Increases-Additional Disbursements
Manual
Electronic
Borrower Perspective
• Day 0: Anticipated Put Date– What does the Borrower see?
• Borrower Notification Letter (welcome letter)• GL Previously Serviced; GL Put Servicer
(sample John Doe letter)• Non-GL Previously Serviced; GL Put Servicer
(sample Jane Doe letter)• Other resources:
– mygreatlakes.org for account information, etc.– NSLDS for verification of where all loans
are serviced
Borrower Perspective
• Day 0– Sample John Doe Letter sent
to borrower once put loan is loaded to our system if GL was previous Servicer & is now Put Servicer
– Letter Explains:• Loan has been put to ED
• GL will still service loan & send updated payment statements if needed
• They may have other loans with lender not affected
• GL contact & payment information
Borrower Perspective
• Day 0– Sample Jane Doe Letter sent
to borrower once Put loan is loaded to our system if GL was NOT previous servicer & is now put servicer
– Letter Explains:• Loan has been put to ED
• GL will now service loan & send payment statements if needed
• They may have other loans with lender not affected
• GL contact & payment information
Change Transaction Dates
Type of Change Transaction Date Restriction
Reinstatements Not allowed on or after adjustment cutoff date (day 9).
Reissues Not allowed on or after adjustment cutoff date (day 9).
Loan Increases Not allowed on or after adjustment cutoff date (day 9).
Grade Level No date restrictions.
Additional Disbursements Not allowed on or after adjustment cutoff date (day 9).
Loan Period Begin and End DatesNo date restrictions unless the change would move the loan outside of eligible put criteria.
Reallocations
No date restrictions.
However, both loans must be serviced by the same put loan servicer and must have disbursed on the same date.
Refunds or Cancellations No date restrictions.
NSLDS
• NSLDS allows schools to verify when a loan was sold to the Department
• Loans are only indentified as being sold to the Department after the sales date and NSLDS has been updated
NSLDS
• Select AID tab• Select borrower• A list of loans for the borrower displays• If the loan is sold to the Department
– Dept of Ed (Guarantor) in the GA field– Department of Ed (Servicer) in the Servicer field
• Click Loan Detail.– The GA/Lender/Servicer Agent History
page with a web link to current servicer
Loans put to ED, guaranteed by ED, serviced by Great Lakes
This borrower’s loans 1 and 2 are guaranteed by ASA, with Chase as lender. Loans 3 and 4 have been put.
School View of NSLDS
Click on Loan Detail to see guarantor/lender/servicer history.
*
* Loan is part of the 2008-2009 Loan Purchase Commitment Program
Click the underlined blue name to see contact information for the entity.
See next page…
School View of NSLDS
Dept. of Ed/Great Lakes information
Dept. of Ed information
Client Services and Borrower Services are main contacts.
Borrower Path to NSLDS
2. Enter•Social security number •First two letters of last name•Date of birth •FAFSA PIN (Personal Identification Number)
1. Go to www.nslds.ed.gov
Borrower View of NSLDS
Loan Menu
Loan Detail
Click the aqua number boxes to see loan detail.
Put information displays here.
Put Loan Servicer Codes
• ACS700577, GA code 577
• Sallie Mae 700578, GA code 578
• PHEAA700579, GA code 579
• Great Lakes700581, GA code 581
• Nelnet700580, GA code 580
School Resources
Put Loan Servicing Page
• mygreatlakes.org– Click
Great Lakes Servicing Federal Student Loans
Put Loan Servicing Page
• Resources– Great Lakes Servicing Overview: Put Loans
• Details put process and how to identify and work with put loans
– List of contacts and resources for all put loan servicers
– Sample Borrower Notification letter– Federally-Held Loans Serviced by
GL Detail Report• Provides list of borrowers with put loans
serviced by Great Lakes
Default Management
Borrowers at Risk Report
• Includes all Stafford & PLUS borrowers now 60 days or more delinquent on loans guaranteed or serviced by GL
• Email address, mailing address, up to two phone numbers for each borrowerUpdated every week
Default Management
Borrowers at Risk Report
• Grouped into five categories:1.) Stafford 320+ days current cohort yr
2.) Stafford < 320 days current cohort yr
3.) Stafford delinquent not current cohort yr
4.) GradPLUS 60+ days delinquent
5.) PLUS delinquent – provides student name
Commonly Asked Questions
• How will loans be allocated between the servicers?
• Will schools or students be able to choose which servicer they work with?
• How will split servicing situations be handled?• How will customer satisfaction be measured?
Quarterly Customer Service Performance Results
• http://www.ifap.ed.gov/eannouncements/031010Loan ServicingInfo.html
Sample Allocations based on Results
Questions?
Great Lakes Client Services(888) 686-6919
Mike Mutziger
Vice President, Marketing and Sales - Northcentral
(888) 502 – 5902 x3032