Federal Student Aid - IFAP
   

Publication Date: August 26, 2004

DCL ID: FP-04-07

Completion of Loan Verification Certificates (LVCs) by Direct Loan Servicing


Posted on 08-26-2004

August 2004

FP-04-07

Subject: Completion of Loan Verification Certificates (LVCs) by Direct Loan Servicing.

Summary: This letter announces the resumption by Direct Loan Servicing of the completion of LVCs in instances where the borrower has only a Direct Consolidation Loan or has only a Direct Consolidation Loan and a Federal Perkins Loan(s).

Reference: Section 428C of the Higher Education Act (HEA)

Dear Colleague:

Recently, the Department's Office of Federal Student Aid (FSA) stopped completing LVCs submitted by Federal Family Education Loan (FFEL) lenders in support of an application for a FFEL Consolidation loan for borrowers who only have a Direct Consolidation Loan or who only have a Direct Consolidation Loan and a Federal Perkins Loan(s). In light of the fact that the HEA reauthorization bill introduced in the U.S. House of Representatives on May 5, 2004 -- H.R. 4283, the "College Access and Opportunity Act of 2004" -- addresses the issue of reconsolidation of Direct Loans, the Department has decided to not take action in this area before the Congress has spoken to the issue. Consequently, FSA will again complete requested certifications upon receiving LVCs that are submitted by FFEL lenders seeking to make FFEL Consolidation loans for borrowers who only have a Direct Consolidation Loan or who only have a Direct Consolidation Loan and a Federal Perkins Loan(s).

Sincerely,

Sally L. Stroup
Assistant Secretary
Office of Postsecondary Education