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Direct Loan Overview

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Direct Loan Overview

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    1. Direct Loan Overview ILASFAA More Change…Less Cents

    2. Moving to DL

    3. Step One Get Federal approval to participate in the DL program Check your school’s Eligibility and Certification Approval Report (ECAR) to see if DL is listed as an approved program. If it is not listed, you must add it by submitting a revised E-APP. Go to “E-APP for Schools” website (www.eligcert.ed.gov) Once your school’s PPA (program participation agreement) is adjusted to include DL your are ready to move to step two

    4. Step Two Send an email to the COD School Relations Center @ CODSupport@acs-inc.com to request participation in the DL program. Include the following information in your email request: Name of your school Address including city, state, and zip code Person requesting participation Email and phone number of the official COD ID# (8 digit #) OPE ID# (8 digit #) DUNS # (if known) Award year in which processing will begin After reviewing your school’s request, ED will send a final approval or denial letter via email

    5. Step Three Your school must decide how it will process Direct Loans: Here are some options: Use EDExpress, free software provided by ED. If you choose to use EDExpress software, you can download the most recent version of the software and related documentation. If you have additional questions about this process, contact Central Processing System (CPS) Technical Support at (800) 330-5947. ED also provides training support on this software that is available through the regions, on the Web, and at Department Conferences. Use Banner, PeopleSoft, or other mainframe vendor’s system for processing Direct Loans Develop your own Direct Loan software using the technical specifications found in the COD Technical Reference available on www.fsasdownload.ed.gov Use a Third Party Servicer

    6. Step Four Update your Student Aid Internet Gateway (SAIG) enrollment to include DL processing Contact the SAIG customer service staff at (800) 330-5947 or visit their website at https://www.fsawebenroll.ed.gov/PMEnroll/index.jsp

    7. Step Five Set up your school to receive Direct Loan funds via the Department’s Grant Administration and Payment System (GAPS) Your bank account information must be in GAPS. Please visit the GAPS website or call the GAPS Hotline at (888) 336-8930 for instructions You must submit a new direct deposit form, Form SF1199A (available at your bank), to receive DL funds even if you will use the same bank account as your other Title IV funds If you already have a valid GAPS user ID and password, you do NOT need to request a separate one for Direct Loans

    8. Step Six Contact COD School Relations at (800) 848-0978 or codsupport@acs-inc.com to reach your primary Customer Service Representative (CSR). He/she will assist you with the following: Adding Direct Loan contact information Signing up to receive Direct Loan bulletins via e-mail Selecting your Direct Loan report options Establishing your promissory note process (paper or electronic) Establishing access to the COD website (Be sure to complete the COD Computer-Based Training (CBT) at http://www.ifap.ed.gov/eannouncements/1007CODUpdatedCBTDoc.html

    9. Step Seven Sign up to receive Direct Loan listserv messages To join, send an email request to David Hebrank at david.hebrank@edl.gov on the Direct Loan Operations team. Include the following information in your email request: Your name Your school Complete email address Request to be added to the listserv

    10. Direct Loan Processing Awarding Origination Disbursement Reconciliation

    11. Direct Loan Processing- Awarding The Institution’s role in the awarding process: Verify that student and parent meet eligibility criteria Provide students with rights and responsibility information

    12. Direct Loan Processing-Awarding The Student’s Role: Accept and/or decline loan funds Sign Master Promissory Note Read borrower’s rights and responsibility information Complete loan entrance counseling Repay loan funds that are received

    13. Direct Loan Processing-Origination The Institution’s Role in the Origination process: Transmit records to Common Origination and Disbursement (COD) Review acknowledgments for rejected records Fix and re-transmit rejected records Send paper promissory notes to COD (provided that the borrower does not have access to complete an online promissory note)

    14. Direct Loan Processing-Origination The Department of Education’s role in the Origination process: Receive, process and transmit batched loan data to institutions Link Master promissory notes to Origination records that are sent by the Institution Provide customer service to Institutions

    15. Direct Loan Processing-Disbursement The Institution’s role in disbursing funds: Disburse funds to students Send disbursement data to COD

    16. Direct Loan Processing-Disbursement The Department of Education’s role in disbursement: Receive and process batch data, as well as transmit batch data back to institutions

    17. Direct Loan Processing-Reconciliation The Institution’s role in the reconciliation process: Institutions must reconcile on a monthly basis Use the Direct Loan School Account Statement (DLSAS) Compare the school’s disbursement data against DLSAS to resolve any issues

    18. Direct Loan Processing-Reconciliation The Department of Education’s Role in the reconciliation process: Provide monthly SAS reports to Institutions

    19. Year-End Closeout Institutions must complete yearly closeout and balance confirmations Total Net Drawdowns (minus) Total Net Disbursements must equal $0 Ending Cash Balance

    20. Factors to Consider The role systems will play in the process The time and amount of staff needed Reports to catch errors(i.e. system and staff)

    21. Useful Phone Numbers For Schools Direct Loan Servicing 1-888-877-7658 COD School Relations Center DL: 1-800-848-0978 CPS/SAIG Technical Support 1-800-330-5947 G5 1-888-336-8930

    22. Useful Sites to Visit Information for Financial Aid Professionals (IFAP): www.ifap.ed.gov Federal Handbook, Volume 4, chapters 1-3 Common Origination and Disbursement: www.cod.ed.gov Direct Loan Servicing: www.dl.ed.gov Direct Loan Consolidation: www.loanconsolidation.ed.gov

    23. Other Useful Sites to Visit Direct Loan Software and Reference Material: www.fsadownload.ed.gov Direct Loan Tools COD Technical References FAA Access on the Web: www.fafsa.ed.gov/FOTWWebApp/faa/faa.jsp National Student Loan Data System (NSLDS): https://www.nsldsfap.ed.gov/secure/logon.asp Department of Education: www.ed.gov

    24. QUESTIONS?????

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