Department of Education Update

15 Jan 2013 9:10 AM | Anonymous
Department of Education Update
David Bartnicki
Federal Training Officer


As mentioned in the November 1, 2012 electronic announcement ED will be providing you with text information for every verification item required by ED. Instead of receiving a more formalized worksheet, we will provide text blocks/segments that will contain sample language you can use for each and every verification item. The electronic announcement containing the suggested text blocks should be posted to IFAP this month. Stay tuned.

One thing I do want to point out is that though the verification text blocks we will provide is suggested text and you will have the flexibility to change items, please note that for the Statement of Educational Purpose you will not be able to adjust the language. We specifically want you to use the Statement of Educational Purpose we will provide.

In addition I have been asked by a few schools if a student provides a high school transcript to validate their high school completion can it be an official or unofficial transcript. Policy has indicated that in this instance we are looking for a final official high school transcript.

PLUS Loans

Some of you may have noticed that we recently extended the time frame that a PLUS credit check will be accepted from 90 days to 180 days. This change was implemented to assist PLUS applicants who were impacted by changes to the PLUS approval process implemented in the fall of 2011. Any applicant who has a credit report that is less than 180 days old will not need to have another credit check run prior to the loan origination. If an applicant has had two credit checks run within the last 180 day period the most recent credit decision will be analyzed. This change will apply to anyone applying for a PLUS Loan before February 1, 2013. On or after February 1, 2013 PLUS credit checks will revert back to the normal 90 day timeframe.

Pell LEU

FOR STUDENTS RECEIVING PELL in the 2012-2013 award year and beyond, they cannot have a Pell LEU over 600%. If their records indicate that they received Pell in 12/13 or later that pushed them over the 600% limit then they would be in a Pell overpayment situation.

Students who prior to 2012-2013 were already over the Pell 600% limit have no Pell eligibility for 12/13 or beyond but remain eligible for other Title IV aid (assuming they meet any specific TIV program requirements).
I have also gotten several questions from schools around students whose records indicate they are over the 600% Pell limit and Title IV eligibility. Just a reminder that if you have a student whose ISIR record or COD Pell data shows that they are over the 600% Pell limit, they are in a Pell overpayment situation and ineligible for any TIV aid until the overpayment is resolved (either paid in full or satisfactory payment arrangements made). There are no allowable exceptions for a student to exceed the 600% Pell LEU. If the school is responsible, the overpayment is resolved when the school returns the funds and properly updates COD.

If a student is at the 600% Pell limit but not over it, then he is not eligible for Pell, but may be eligible for other forms of Title IV aid.

GE Disclosures

ED posted an electronic announcement 11/23/12 (GE EA #42) informing schools that by January 31, 2013 all schools must update their disclosures for each of their GE Programs for the 2011-2012 award year. We also indicated that until the ED template is available, institutions must make their GE Program disclosures using an institutionally-determined format. For additional information please see the above mentioned electronic announcement or go to the GE webpage on IFAP - . Please make sure you properly update your program disclosures as this is an area being reviewed by program reviewers and auditors.

Subsidized Loan Limitations

I continue to get numerous calls and emails around the upcoming limits on subsidized loans for undergraduate students. In an electronic announcement dated 7/10/12 and during the FSA Conference, ED officials provided some basic information about the new subsidized loan limitation as required under Public Law 112-141. The new law will limit eligibility for Direct Subsidized Loans for new borrowers on or after July 1, 2013. A new borrower on or after July 1, 2013 will not be eligible for new Direct Subsidized Loans if the period during which the borrower has received such loans exceeds 150 percent of the published length of the borrower’s educational program. The law also provides that a borrower reaching the 150 percent limit becomes ineligible for interest subsidy benefits on all Direct Subsidized loans first disbursed to that borrower on or after July 1, 2013.

ED is currently developing regulations and operational procedures to implement the new law as of July 1, 2013. FSA is going to have to track, calculate and inform schools of subsidized loan limits and schools will have to provide certain program information to FSA for proper monitoring. I have been getting a lot of questions that we just don’t have answers for yet. Please be patient. I promise that as soon as we can ED will post additional guidance on IFAP regarding requirements, tracking mechanisms, student eligibility, etc. Stay tuned.


For those that were unable to attend the FSA Conference in November don’t forget that you can review the presentations and video recordings on our conference website -
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