Posted Date: September 10, 2010

Author:  Jana Hernandes, Service Director, Operations, Federal Student Aid

Subject: Total and Permanent Disability Discharge Information - GA Assignment Procedures Effective October 1, 2010 (Updated June 12, 2013)

June 12, 2013 Note: In a May 17, 2013 Electronic Announcement, we explained how the total and permanent disability (TPD) discharge regulations will change on July 1, 2013. The assignment procedures below are effective for those who submit TPD discharge applications before July 1, 2013. For those who submit TPD discharge applications on or after July 1, 2013, refer to the assignment procedures posted in a June 12, 2013 Electronic Announcement.

May 27, 2011 Note: Effective April 1, 2011, the Nelnet Total and Permanent Disability Servicer will process and service all general (non veterans) total and permanent disability discharge assignments and referrals. For complete details, including links to updated contact information, refer to the Electronic Announcement posted on March 25, 2011. Effective June 1, 2011, the Nelnet Total and Permanent Disability Servicer will also process and service all veterans total and permanent disability discharge assignments and referrals. For complete details, including links to updated contact information, refer to the Electronic Announcement posted on May 27, 2011.

We also replaced the errata sheet attachment, the Procedures document, and Appendix VII.

November 15, 2010 Note: On November 15, 2010, we updated this announcement by replacing several attachments with updated versions. We also added a new attachment titled "Errata Sheet for Guaranty Agency Total and Permanent Disability Discharge Assignment Documents" which provides a list of the attachments that were replaced and a summary of the changes in each of the updated attachments.

In an August 13, 2010 Electronic Announcement on the Information for Financial Aid Professionals (IFAP) Web site, we announced the award of the Department of Education's (the Department's) total and permanent disability servicer contract to Nelnet and the overall transition plan for general total and permanent disability discharge assignments. The transition will include the continuation of work with the current total and permanent disability discharge servicing centers for a period of time after the Nelnet start on October 1, 2010.

Beginning October 1, 2010, the following three processing methods will be in effect:

  • The Nelnet Total and Permanent Disability Servicer in Denver, CO will receive and process new general total and permanent disability discharge assignments and referrals.

  • The Veterans Disability Discharge Unit in Atlanta, GA will receive and process all veterans total and permanent disability discharge referrals.

  • The Disability Discharge Loan Servicing Center in Greenville, TX will complete all general total and permanent disability discharge assignments and referrals submitted by loan holders prior to October 1, 2010.

In this announcement, we provide procedures that guaranty agencies will follow when submitting new general total and permanent disability discharge assignments and referrals to the Nelnet Total and Permanent Disability Servicer in Denver, CO. In addition, we include procedures that guaranty agencies will follow when submitting veterans total and permanent disability discharge referrals to the Veterans Disability Discharge Unit in Atlanta, GA. All of these procedures are effective October 1, 2010.

We present the information in this announcement as follows:

  • Components of Total and Permanent Disability Discharge Assignment Procedures

  • Forthcoming Communication

 Components of Total and Permanent Disability Discharge Assignment Procedures

The total and permanent disability discharge assignment procedures that guaranty agencies will follow beginning October 1, 2010 are attached in PDF format at the end of this announcement. The 11 components are as follows:

Table of Contents - Lists the sections of the procedures document and all appendices.

Procedures - Provides all operational instructions and other information, including new Student Aid Information Gateway (SAIG), National Student Loan Data System (NSLDS), submission address, and contact information (effective October 1, 2010).

In the Procedures document, we clarify the following with respect to involuntary payments:

  • If a loan was paid in full through involuntary payment within 30 days of a guaranty agency's receipt of a discharge application, the guaranty agency may assign the loan to the Department. Contact the Nelnet Total and Permanent Disability Servicer before assigning a loan with a zero (0.00) balance.

  • If a guaranty agency receives an involuntary payment on an account after assignment to the Department, the guaranty agency may return the payment if it determines that the involuntary payment resulted from the guaranty agency's error.

In addition, if a promissory note or Master Promissory Note (MPN) was signed electronically, a guaranty agency no longer needs to include a sheet of paper with a copy of the electronically signed promissory note/MPN that contains the applicable certification ("I declare under penalty of perjury that the foregoing…").

Appendix I - New and Existing Fields: Contains information about one new field and one of the existing fields. When making the program changes to add the new field, a guaranty agency should use this opportunity to ensure that its programs are populating all of the fields correctly.

Appendix II - Assignment File Format: Contains the revised assignment file format. As noted under Appendix I, a new field is being added to the assignment file. Although we provide a new file format, a guaranty agency may continue to use the current file format or the manual paper process until further notice.

The new field is in the TPD Discharge Assignment File Detail Record in Position 1475 and denotes the file record's type of assignment or referral as follows:

  • A = Regular TPD Discharge Assignment

  • B = Endorser/Co-Maker Account

  • C = Veterans Account

  • D = Joint Consolidation Loan

Appendix III.A - Assignment Form: Contains the new total and permanent disability assignment form. All assignments that are submitted manually (on paper) must be accompanied by the assignment form.

Appendix III.B - Referral Form: Contains the new total and permanent disability referral form. All referrals must be accompanied by the referral form.

Appendix IV - SAIG Record Specifications: Contains new record specifications for submitting assignments and referrals through the SAIG.

Appendix V - Additional Information: Contains revised instructions for the manifest that must accompany hard copy files, including a revised Sample Manifest.

Appendix VI - Joint Consolidation: Contains procedures for referring applications for discharge of joint consolidation loans and PLUS loans with co-makers who are disabled, as well as loans with endorsers who are disabled.

Appendix VII - Veterans Disability Discharge: Contains procedures for referring applications from veterans applying under the special qualifications for veterans. As noted above, veterans total and permanent disability discharge referrals are submitted to the Veterans Disability Discharge Unit in Atlanta, GA.

Appendix VIII - Discharge Application: Total and Permanent Disability: Contains a link to the approved Discharge Application: Total and Permanent Disability.

Forthcoming Communication

We appreciate the community's patience and assistance as we transition to our new total and permanent disability discharge servicer. After we begin the transition on October 1, 2010, we will inform the community of this start and reiterate processing and contact information. Please monitor the IFAP Web site for this communication.

Attachments/Enclosures:

Errata Sheet for Guaranty Agency Total and Permanent Disability Discharge Assignment Documents in PDF Format, 93KB, 4 Pages

Guaranty Agency Total and Permanent Disability Discharge Assignment Procedures: Table of Contents in PDF Format, 70KB, 2 Pages

Guaranty Agency Total and Permanent Disability Discharge Assignment Procedures: Procedures in PDF Format, 260KB, 21 Pages

Guaranty Agency Total and Permanent Disability Discharge Assignment Procedures: Appendix I - New and Existing Fields in PDF Format, 125KB, 1 Page

Guaranty Agency Total and Permanent Disability Discharge Assignment Procedures: Appendix II – Assignment File Format in PDF Format, 353KB, 37 Pages

Guaranty Agency Total and Permanent Disability Discharge Assignment Procedures: Appendix III.A – Assignment Form in PDF Format, 159KB, 24 Pages

Guaranty Agency Total and Permanent Disability Discharge Assignment Procedures: Appendix III.B – Referral Form in PDF Format, 267KB, 24 Pages

Guaranty Agency Total and Permanent Disability Discharge Assignment Procedures: Appendix IV – SAIG Record Specifications in PDF Format, 146KB, 3 Pages

Guaranty Agency Total and Permanent Disability Discharge Assignment Procedures: Appendix V – Additional Information in PDF Format, 170KB, 2 Pages

Guaranty Agency Total and Permanent Disability Discharge Assignment Procedures: Appendix VI – Joint Consolidation in PDF Format, 223KB, 11 Pages

Guaranty Agency Total and Permanent Disability Discharge Assignment Procedures: Appendix VII – Veterans Disability Discharge in PDF Format, 517KB, 5 Pages

Guaranty Agency Total and Permanent Disability Discharge Assignment Procedures: Appendix VIII – Discharge Application: Total and Permanent Disability in PDF Format, 16KB, 1 Page

   

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