In a November 21, 2019 Electronic Announcement, we informed schools about a change to our approved Master Promissory Note (MPN) confirmation processes. The new process will require student and parent borrowers to view how much they currently owe in federal student loans, and to acknowledge that they have seen this amount before a school can make the first disbursement of the first Direct Loan that a student or parent borrower receives for each new award year.
The "Annual Student Loan Acknowledgement" process (previously referred to as the "Informed Borrowing Confirmation" process) will be available on StudentAid.gov beginning in late April 2020. However, while we plan to implement most of the functionality explained in this announcement, we will delay the requirement that borrowers complete the Annual Student Loan Acknowledgement prior to disbursement for the 2020–21 Award Year. Instead, the Annual Student Loan Acknowledgement must be completed before a borrower can receive the first disbursement of the first loan the borrower receives for a particular award year, starting with loans associated with the 2021–22 Award Year. See also our March 27, 2020 Electronic Announcement.
Note: For the purposes of the Annual Student Loan Acknowledgement process, the term "award year" means the award year to which the loan is assigned in the Common Origination and Disbursement (COD) System.
While the borrower completion requirement is delayed; we do want to provide operational information about the April 2020 system changes that will incorporate the Annual Student Loan Acknowledgement into existing Direct Loan processing. In this announcement, we explain possible operational impacts to schools, describe what borrowers will experience when they complete the process, and provide COD System processing information. We hope this information will assist schools and software vendors as they continue preparing for the upcoming changes.
We will continue to post additional operational guidance as it becomes available.
School-Based Operational Impacts
As noted in the earlier announcement, schools will need to update websites and other materials to include information about the Annual Student Loan Acknowledgement. Schools will also need to update internal processes and procedures to ensure that borrowers complete the Annual Student Loan Acknowledgment. Though the requirement will not begin until the 2021–22 Award Year, we encourage schools to begin evaluating the impact at the earliest point possible.
A school is not required to change its financial aid offers or packaging materials, but it will be required to inform the borrower of the new requirement. To assist schools with notifying borrowers of the new requirement, we will be posting materials that can be used for borrower outreach. We will inform schools when these materials are available in forthcoming communications.
As a reminder, the Annual Student Loan Acknowledgement is in addition to the existing MPN confirmation processes that we have approved; it does not require schools to make any changes to their MPN confirmation processes. Further, the Annual Student Loan Acknowledgement also does not replace existing counseling requirements. This means that in addition to completing the Annual Student Loan Acknowledgement, first-time student Direct Loan borrowers must also complete entrance counseling before receiving their first loan disbursement, and Direct PLUS Loan applicants who are determined to have an adverse credit history and qualify for a Direct PLUS Loan by obtaining an endorser or documenting extenuating circumstances must also complete PLUS credit counseling.
Borrowers will be able to complete the Annual Student Loan Acknowledgement independently from other processes (i.e., borrowers are not required to complete an MPN or entrance counseling first). In addition, it can be completed regardless of whether or not a loan origination record is on file.
Note: We are aware that some schools already must provide borrowers information similar to the Annual Student Loan Acknowledgement to fulfill state requirements. The Annual Student Loan Acknowledgement is a separate process that must be completed even if a borrower has already been provided with similar information under a state requirement.
The Annual Student Loan Acknowledgement is not school-specific. If a borrower completes the process for a loan associated with a particular award year at one school, the borrower will not complete the process for another loan associated with that same award year again, even if he or she receives the other loan at a different school. An example is shown in the table below.
|Borrower A||School Name||Loan Award Year (in
|Loan A, Disb 1||123 University||2021–22||Y|
|Loan B, Disb 1||ABC Career College||2021–22||N|
The Annual Student Loan Acknowledgement is also not specific to a particular loan type. For example, if a graduate student initially receives only a Direct Unsubsidized Loan and completes the Annual Student Loan Acknowledgement, but later receives a Direct PLUS Loan that is assigned to the same award year as the earlier Direct Unsubsidized Loan, the student is not required to complete another Annual Student Loan Acknowledgement before receiving the first disbursement of the Direct PLUS Loan.
Notes about the Borrower Experience
All borrowers (both students and parents) will complete the Annual Student Loan Acknowledgement on StudentAid.gov. For a Direct PLUS Loan made to a parent borrower, only the parent completes the Annual Student Loan Acknowledgement.
Note about FSA IDs: To complete the Annual Student Loan Acknowledgement, borrowers must be able to log in to StudentAid.gov using their username and password (FSA ID). To ensure borrowers can complete the process in a timely manner, schools can help by reminding borrowers to have an active FSA ID at the earliest possible point in time. This could include having borrowers create an FSA ID if they do not already have one or requesting that borrowers validate their existing username and password if they anticipate borrowing in the 2021–22 Award Year.
The Annual Student Loan Acknowledgement should take less than 10 minutes to complete. The experience will be personalized based on the borrower’s attributes, but generally—
First-time borrowers (those who have no current loan balance) will
answer a few questions about their state, school, expected degree, and field of study.
view summary information from the College Scorecard about total estimated school costs, graduation rate, total estimated student loan debt, and estimated monthly payments.
Note: College Scorecard data is unavailable for borrowers attending foreign schools. Borrowers attending foreign schools will be able to proceed without viewing College Scorecard data.
view general financial literacy information about borrowing student loans.
check a box acknowledging they read and understood the information.
Returning aid recipients (borrowers with current outstanding loan balances) will
view summary information about their loans and grants from the National Student Loan Data System (NSLDS®) as of the day they complete the acknowledgement. Information includes outstanding balance, estimated 10-year standard monthly payment based on the borrower's current balance, servicer information, loan limit information, grant summary, and grant limit information.
check a box acknowledging they read and understood the information.
Although borrowers will not be required to complete the Annual Student Loan Acknowledgement process until they begin receiving loans for the 2021–22 Award Year, it will be available to borrowers following the StudentAid.gov update in April 2020.
COD System Operational Impacts
Beginning in April 2020, we will begin processing information about borrowers’ completion of the Annual Student Loan Acknowledgement. Schools will receive information from us in several ways, including Common Record responses, Common Record web responses, system-generated responses, COD web, COD edits, and COD reports.
While borrowers will see the term “Annual Student Loan Acknowledgement” on StudentAid.gov and in any borrower-facing materials that we produce, schools will continue to see references to “Informed Borrowing Confirmation” on the COD website screens, in the tags for the COD XML schema, and in parts of the COD Technical Reference.
Common Record Processing
Schools will receive three new tags (<InformedBorrowingComplete>, <InformedBorrowingCompletionDate>, and <InformedBorrowingID>) to indicate whether a borrower has completed the Annual Student Loan Acknowledgement and can receive loan funds. The tags will be returned in the Direct Loan response block (award level) in Common Record and web responses. The tags will be returned starting with the 2020–21 Award Year, but schools will not need to take action as a result of receiving the tags.
In addition to the Common Record and web responses, schools will receive the tags in a new system-generated Informed Borrowing response (message class: CRIBxxOP). The response will be sent if a borrower has completed the Annual Student Loan Acknowledgement and a Direct Loan award is on file. The response will be sent to the school associated with the award “linked” to the acknowledgement. Alternatively, schools can request a CRIB response via the COD website.
As with other system-generated responses, schools will receive them once per day (usually overnight for the preceding day’s activity).
Note: Schools must implement COD Common Record Schema version 4.0d to receive the tags and responses associated with the Annual Student Loan Acknowledgement process. Schools can refer to an COD XML Schema 4.0d posting for more information about the new schema version.
COD Website Updates
Schools will be able to view and search for Annual Student Loan Acknowledgement completion information. The COD website will be updated with three new fields which align with the new schema tags: Informed Borrowing Completion, Informed Borrowing Completion Date, and Informed Borrowing ID. The fields will display on the Award Detail page and Batch Response Information page. Schools can also find the fields through the Person – Direct Loan Information page.
Schools can also search for Informed Borrowing completion status. The “Informed Borrowing Search” can be performed using the borrower SSN and award year (up to 10 SSNs can be added per search). The search results page will include SSN, name, award year, Informed Borrowing Completion Date, and Informed Borrowing ID. If needed, schools can request the Informed Borrowing system-generated response be sent from the search results page.
Schools can also search for Informed Borrowing responses (CRIB) using the Batch Search functionality.
COD System Edits – Reject Edit 225
With the April 2020 implementation, we will add COD System Reject Edit 225, but it will not be in use for the 2020–21 Award Year. We will not require borrowers to have the Annual Student Loan Acknowledgement prior to disbursement until the 2021–22 Award Year.
Note: For the 2021–22 Award Year and forward, schools will receive a new COD Reject Edit 225 (“Actual disbursement submitted with no Informed Borrowing Completion on file.”)on actual (Disbursement Release Indicator = True) Direct Loan disbursements if the Annual Student Loan Acknowledgement process has not yet been completed by the borrower. The edit will be returned at the disbursement level.
If COD Reject Edit 225 is triggered when the origination is first submitted, schools will also receive COD Reject Edit 117 (“Disbursement information is incomplete or rejected. Direct Loan award is not accepted.”) for the award.
The Direct Loan Rebuild will be updated to include three new fields which align with the new schema tags: Informed Borrowing Completion, Informed Borrowing Completion Date, and Informed Borrowing ID.
No other current reports will be modified to include Annual Student Loan Acknowledgement information, and there are no new reports being implemented for this new process.
Software and Documentation
We have updated the 2020–21 COD Technical Reference to include additional information about the Annual Student Loan Acknowledgement.
Note for EDExpress Users: EDExpress for Windows 2020–2021, Release 2.0, scheduled for release in spring 2020, will be updated for the Annual Student Loan Acknowledgement process. We will communicate EDExpress Release 2.0 information through forthcoming electronic announcements on the IFAP website.
We are updating the training material for a webinar about the Annual Student Loan Acknowledgement. Updated details, including new dates and registration information, will be provided in a forthcoming Training Announcement to be posted to the IFAP website.
If you have questions about this announcement, contact the COD School Relations Center at 1-800-848-0978. You may also email CODSupport@ed.gov.