Publication Date: November 2001
DCL ID: CB-01-13
This letter provides implementation information about the enclosed new Federal Perkins Loan and National Direct Student Loan (NDSL) promissory notes.
November
2001
CB-01-13
SUMMARY:
This letter provides implementation information about the enclosed new Federal
Perkins Loan and National Direct Student Loan (NDSL) promissory notes.
FEDERAL
STUDENT FINANCIAL AID HANDBOOK REFERENCE: This letter supplements the information
contained in Part 2 of the Campus-Based Program Section of the 2001-2002
Student Financial Aid Handbook
Dear
Partner:
This
letter will serve as the Department of Education's (ED) approval of the following
Federal Perkins Loan and NDSL promissory notes:
·
Federal Perkins
Loan Closed-End Promissory Note
·
Federal Perkins
Loan Open-End Promissory Note
·
NDSL Closed-End
Promissory Note
·
NDSL Open-end
Promissory Note
These
promissory notes reflect programmatic changes made in the Federal Perkins Loan
and NDSL programs by the Higher Education Amendments of 1998. Previously, ED had provided schools an addendum to be used with the Federal Perkins Loan and NDSL promissory notes contained in Dear Colleague Letters CB-93-9 and CB-96-8.
The
major changes made to the promissory notes include:
·
provisions for
the implementation of the loan rehabilitation program and clarification that
the 24 percent cap on collection costs that may be assessed on a rehabilitated
loan does not apply if the borrower defaults again on the rehabilitated loan;
·
retained grace
periods for borrowers who are ordered to active duty for a period of more
than 30 days;
·
notification of
the availability of the Department of Education's Student Loan Ombudsman;
·
the expansion
of borrower eligibility for volunteer service cancellations for NDSL loans;
·
the addition of
a new section on Discharges;
·
the addition of
the Privacy Act Notice, Financial Privacy Act Notice, and the Paperwork Reduction
Notice;
·
a correction to
the cross-references to the Individuals with Disabilities Act (IDEA)
to reflect statutory changes as a result of the reauthorization of IDEA in
1997;
·
revisions to the
Deferment section to reflect that deferment requests no longer need to be
in writing and that it is no longer necessary for a borrower to request an
in-school deferment; and
-
revisions
to the Deferment section relating to economic hardship deferments for borrowers
who are in the Peace Corps or who have received an economic hardship deferment
under the Federal Family Education Loan Program or the William D. Ford Federal
Direct Loan Program
In
addition, minor changes were made in various sections of the promissory notes
to improve the text and language.
Implementation
of the New Promissory Notes --
Format and
Content
The
newly revised promissory notes are legally valid documents with an OMB document
number and expiration date. The new
promissory notes are authorized for use through October 31, 2004.
No changes to, deletions from, or additions to the prescribed language are permitted
except that bracketed text may be deleted at the option of the institution.
Of course, information (name, address, and telephone number) identifying the
school may be printed in Section B, Item 6.
Appropriate coding is also permitted (for example, bar coding to reflect the
source, type, or other identification system for filing or processing) in this
area. Additional bar coding is permitted
in the side or bottom margins to meet requirements for individual processing
systems. These coding identifiers
may not be printed on the promissory notes in a way that would alter the general
layout of the note. Schools may also
print in the lower margin of the promissory note a reference to the type: for
example, original, student copy, file copy.
Implementation
Deadline
The
new Federal Perkins Loan and NDSL promissory notes are available for use immediately
and must be used no later than May 1, 2002.
No further use of the notes issued as part of Dear Colleague Letters CB-96-8
or CB-93-9 is permitted on or after May 1, 2002.
Printing
Instructions
The
enclosed documents must be printed with black ink on white paper.
The typeface, point size, and general presentation of the form may not be changed
from the enclosed documents approved by ED. However, a school's identifying
information located in Section B, Item 6 may be printed in another color to
make the school's name and address more pronounced.
The
new Federal Perkins Loan and NDSL promissory notes are available in PDF and
Word format on ED's Information for Financial Aid Professionals website at
www.ifap.ed.gov.
If you have any questions concerning the new promissory notes and their use,
please contact Brian Smith or Vanessa Freeman at (202) 377-4008 or via email
at firstname.lastname@ed.gov.
Jeffrey Baker, Director
Program
Development Division
Student
Financial Assistance
Attachments/Enclosures:
Federal Perkins
Loan Closed-End Promissory Note in MS Word Format, Size 60KB, pages 4
Federal Perkins Loan Closed-End Promissory Note in PDF Format, Size 39KB, pages 4
Federal Perkins
Loan Open-end Promissory Note in MS Word Format, Size 61KB, pages 4
Federal Perkins
Loan Open-end Promissory Note in PDF Format, Size 28KB, pages 4
NDSL Closed-End Promissory Note in MS Word Format, Size 59KB, pages 4
NDSL Closed-End Promissory Note in PDF Format, Size 30KB, pages 4
NDSL Open-end Promissory
Note in MS Word Format, Size 61KB, pages 4
NDSL Open-end Promissory
Note in PDF Format, Size 28KB, pages 4
