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“Financial Aid Evolution: Change
Agents”OASFAA Fall
Conference 2015
Decoding CDR Reports and Correcting Data
Administrative capability
Why Review Your CDR Data
A high CDR could result in Adverse publicity
Loss of Title IV eligibility
Loss of access to private loan funds
Extra work due to loss of benefits or added sanctions
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
Administrative capability
Better-quality decision-making
Why Review Your CDR Data
Capturing the right data, accurate data, and timely data is critical for making good policy and accurate decisions
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
2
Administrative capability
Better service to students
Why Review Your CDR Data
When borrowers default They pay more in interest and collections fees
The government can seize wages, tax refunds, and Social Securityand disability benefits
Better-quality decision-making
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
Agenda
Discuss the Cohort Default Rate (CDR) cycle
Decode the Loan Record Detail Report
Review how to comparing and correct data
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
“Financial Aid Evolution: Change
Agents”OASFAA Fall
Conference 2015
Understanding the Cohort Default Rate Cycle
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What Is a Cohort Default Rate?
The Numerator is the number of Stafford loan
borrowers from the denominator who default
within a cohort period
The Denominator is the number of Stafford loan
borrowers who enter repayment within a
cohort period
= Did not default in 2012-2014
= Defaulted in 2012
= Defaulted in 2013
= Defaulted in 2014
All borrowers entered repayment in 2012
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
What Is a Cohort Default Period?
Borrowers who entered repayment between
10/01/2011 and 9/30/2012
Borrowers who entered repayment between 10/01/2011
and 9/30/2012 and who defaulted between 10/01/2011
and 9/30/2014
3-year CDR Example FY2012
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
What Is a Cohort Default Rate Cycle?
The Department sends draft and official cohort default rates to all schools that Are eligible to participate in any of the Title IV programs
Have had a borrower in repayment in the current or any of the past cohort default rate periods
Source: CDR Quick Reference Guide
February August
Draft default rates released to schools only
Official rates released to schools and the general public
September JanuaryDraft Rate Cycle Official Rate Cycle
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
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What Is a Cohort Default Rate Cycle?
The official cohort default rates are available to the public through a searchable database at: ed.gov/FSA/defaultmanagement/cdr.html
Source: CDR Quick Reference Guide
February August
Draft default rates released to schools only
Official rates released to schools and the general public
September JanuaryDraft Rate Cycle Official Rate Cycle
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
No Sanctions or Benefits Associated with Draft CDR
Keep in mind Schools that fail to challenge the accuracy of draft cohort default rate data
through an incorrect data challenge may not contest the accuracy of the data used in the official rate
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
How Are Schools Notified?
CDR notification packages Sent electronically to all domestic schools (eCDR)
Using Student Aid Internet Gateway (SAIG)
Allowed five business days to report problems
Timelines for submitting challenges, adjustments and appeals begin six days following announced transmission date, as posted on IFAP (ifap.ed.gov)
IFAP notification establishes the “Timeframe Begin Date”
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
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What Is Included in the eCDR?
CDR package includes Cover letter
Loan Record Detail Reports (LRDR) Reader-friendly
Extract-type
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
“Financial Aid Evolution: Change
Agents”OASFAA Fall
Conference 2015
Decoding the Loan Record Detail Report
Loan Record Detail Report (LRDR)
Contains borrower information for Stafford (DL & FFELP) loans that were used to calculate a school’s draft or official cohort default rate
Includes borrower’s
Name, social security number
Date borrower entered repayment
Date of default (if applicable)
Loan type
Borrowers with multiple loans will be counted only once
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
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Review LRDR
Check for accuracy
Compare to school records Repayment Date
Default Status
Cancellations/Refunds
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
Submitting Challenges and Adjustments
Schools MUST use eCDR Appeals to prepare and submit challenges or adjustments
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
Loan Record Detail Report –Data Manager
Three-digit code used to identify entity reporting the information
Guaranty Agency Department of Education
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
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Reader-Friendly LRDR
Loan Record Detail Report –Repayment Date
Indicates when the borrower began repayment Determines if the loan is included in the denominator
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
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Loan Record Detail Report –Default Date
Indicates the date A Direct Loan is considered in default based on its past due status
- OR -
Guarantee agency paid a default claim to a lender for a FFELP Loan
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
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Loan Record Detail Report –CDR Usage
Indicates how the loan is included in the calculation “D” Denominator only
“B” Both Numerator and Denominator
“N” Not Used
“E” Eligible, but not counted
Important Codes to Know
Source: CDR Guide, page 2.3-7
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
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Important Codes to Know
Source: CDR Guide, page 2.3-8“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
“Financial Aid Evolution: Change
Agents”OASFAA Fall
Conference 2015
Collecting and Comparing Data
Collecting the Data
Determine data that needs to be captured Last date of attendance (LDA)
Less than half-time date (LTH)
Withdrawal date (WD)
Date entered repayment (DER)
Claim paid date/default date (CPD/DD)
Use a spreadsheet or database to collect this data Implement this process early
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
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Collecting the Data
Determine where to find data Internal resources available
on-campus
External resources NSLDS
Loan servicers
Guaranty agencies
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
Possible Errors on LRDR
LRDR incorrectly: Reports a data element and the data element should be changed
Includes a borrower whose repayment date does not fall within the cohort fiscal year and the borrower should be removed from the cohort rate calculation
Excludes a borrower who entered repayment within the cohort and the borrower should be added to the cohort rate calculation
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
Should the Loan be Included inFY 2012 CDR?
Mariah
Withdrew from school 11/4/2011
NSLDS reveals Mariah transferred to another school on 2/4/2012
LDA
11/4/2011
Add 6 months,
1 day
5/5/2012
Date entered
repayment
Actual DER5/13/2013
Default date
5/8/2014
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
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Should the Loan be Included inFY 2012 CDR?
Mariah
If date of repayment is delayed by re-enrolling in school prior to the end of grace, inclusion in a CDR calculation is also delayed
Defaulted between 10/1/2011 – 9/30/2014• Defaulted 5/8/2014
FY 2012 (10/1/2011 – 09/30/2012)• Date Mariah entered repayment 5/13/2013
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
Should the Loan be Included inFY 2012 CDR?
Katy
Withdrew from school 11/4/2011
Loans are deferred on 1/12/2013
LDA Add 6 months,
1 day
Date entered
repayment
05/05/2012(Loan deferred
1/12/2013)
Default date
11/4/2011 5/5/2012 N/A
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
Should the Loan be Included inFY 2012 CDR?
Katy
Deferments or forbearances do not alter the date the borrower entered repayment
Defaulted between 10/1/2011 – 9/30/2014• No default
FY 2012 (10/1/2011 – 09/30/2012)• Date Katy entered repayment 05/05/2012
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
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Should the Loan be Included inFY 2012 CDR?
Adele
Withdrew from school 6/1/2011; defaulted on loans 05/27/2013
Consolidated three loans 12/4/2013
LDA
6/1/2011
Add 6 months,
1 day
12/2/2011
Date entered
repayment
12/2/2011
Default date
5/27/2013
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
Should the Loan be Included inFY 2012 CDR?
Adele
The date underlying loans entered repayment is the date used in the cohort default rate calculation
Defaulted between 10/1/2011 – 9/30/2014• Adele defaulted 5/27/2013
FY 2012 (10/1/2011 – 09/30/2012)• Date Adele entered repayment 12/02/2011
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
Should the Loan be Included inFY 2012 CDR?
Taylor
Graduated from school 6/1/2011
Paid loan in full on 7/1/2011
LDA
6/1/2011
Add 6 months,
1 day
12/2/2011
Date entered
repayment
Loan paid in full 7/1/2011
Default date
N/A
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
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Should the Loan be Included inFY 2012 CDR?
Taylor The paid-in-full date becomes the new repayment date Same is true for loans discharged due to death, bankruptcy,
disability
Defaulted between 10/1/2011 – 9/30/2014• No default
FY 2012 (10/1/2011 – 09/30/2012)• Date Taylor paid in full 07/01/2011
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
Should the Loan be Included in FY 2012 CDR?
Ariana
Entered repayment on 11/14/2011; defaults on 12/4/2012
Begins loan rehabilitation on 3/29/2013 and completes it on 12/29/2013
Date Entered
Repayment
Rehab Begins
3/29/2013
Rehab Completed
11/14/2011 12/29/2013
Default Date
12/4/2012
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
Should the Loan be Included inFY 2012 CDR?
Ariana The borrower is included in the cohort fiscal year when they enter
repayment They are also included if they default during the same cohort
period but removed if they rehabilitate before the cohort ends
Defaulted between 10/1/2011 – 9/30/2014• No default
FY 2012 (10/1/2011 – 09/30/2012)• Date Ariana paid in full 07/01/2011
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
15
“Financial Aid Evolution: Change
Agents”OASFAA Fall
Conference 2015
Correcting Data
Challenges of Draft CDR
Used to correct errors on the draft CDR
Submitted by school to guarantors (FFEL) and/or DL servicers via eCDR Appeals within 45 days of timeframe begin date Relevant information for each borrower challenged
Supporting documentation for each borrower challenged
CEO certification letter
34 CFR 668.185(b)34 CFR 668.204(b)
Incorrect Data Challenge (IDC)
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
Challenges of Draft CDR
Only available if a school is potentially subject to a loss of eligibility (or provisional certification) based on draft rates
School must send completed PRI Challenge to the U.S. Department of Education within 45 days of timeframe begin date PRI Challenge Spreadsheet (CDR Guide page 4.2– 8)
Letter
Participation Rate Index Challenge (PRI)
34 CFR 668.185(c)
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
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Adjustments of Official CDR
Ensures that a school’s official cohort default rate calculation reflects changes that were correctly agreed to as a result of an incorrect data challenge
School must submit its UDA to the Department within 30 calendar days of timeframe begin date via eCDR Appeals system
34 CFR 668.19034 CFR 668.209
Uncorrected Data Adjustment (UDA)
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
Adjustments of Official CDR
Allows a school to challenge the accuracy of “new data” included in most recent official CDR Compare LRDR of draft CDR to LRDR of official CDR to determine if new data is
reported correctly
New Data Adjustment (NDA)
34 CFR 668.19134 CFR 668.210
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
Adjustments of Official CDR
School must submit its NDA to Data Manager via eCDR Appeals within 15 days of timeframe begin date Relevant Information for each borrower challenged
Supporting documentation each borrower challenged
CEO Certification Letter
New Data Adjustment (NDA)
34 CFR 668.19134 CFR 668.210
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
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Appeals of Official CDR
Available if the school is subject to a loss of eligibility (or provisional certification) based on official rates; or
If the school previously challenged the accuracy of data as part of its Incorrect Data Challenge, or
If a review of loan record detail reports for draft and official rates show new data
Erroneous Data Appeal (ER)
34 CFR 668.19234 CFR 668.211
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
Appeals of Official CDR
School must send the Erroneous Data Appeal allegations to Data Manager within 15 days of timeframe begin date Erroneous Data Appeal spreadsheet
Relevant pages of Loan Record Detail Report
Supporting documentation
Letter
Erroneous Data Appeal (ER)
34 CFR 668.19234 CFR 668.211
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
Appeals of Official CDR
Alleges a school’s official cohort default rate includes defaulted loans that are considered improperly serviced for cohort default rate purposes
Example Borrower never made a loan payment and school can document that
lender/servicer failed to complete due diligence
Loan Servicing Appeal (LS)
34 CFR 668.19334 CFR 668.212
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
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Appeals of Official CDR
School must send request for loan servicing records to Data Manager and to the Department within 15 days of timeframe begin date
Loan Servicing Appeal (LS)
34 CFR 668.19334 CFR 668.212
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
Appeals of Official CDR
Data Manager notifies school and the Department within 20 days of receipt of request Fees for providing records
List of representative sample
Description of how sample was chosen
School must pay the fee, if charged within15 days of data manager notification
Loan Servicing Appeal (LS)
34 CFR 668.19334 CFR 668.212
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
Appeals of Official CDR
Available based on a loss of eligibility or notice of second successive official rate potentially subjecting school to provisional certification
Economically Disadvantaged Appeal (EDA)
34 CFR 668.184
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
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Appeals of Official CDR
School must submit management assertion to the Department within 30 days of timeframe begin date and the independent auditor opinion’s within 60 days Spreadsheet of students that qualify to be included
School’s low-income rate and placement rate (non-degree-granting school)
School’s low-income rate and completion rate (degree-granting school)
Economically Disadvantaged Appeal (EDA)
34 CFR 668.184
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
Appeals of Official CDR
Only available if a school is subject to a loss of eligibility or provisional certification based on official rates
School must send completed Participation Rate Index Appeal to the Department within 30 days of timeframe begin date Participation Rate Index Appeal spreadsheet
Letter
34 CFR 668.19534 CFR 668.214
Participation Rate Index Appeal (PRI)
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
Appeals of Official CDR
Not subject to sanctions based on three consecutive CDRs that meet or exceed the relevant threshold if At least two of their official cohort default rates are average rates; and
CDRs would have been less than the relevant threshold if they had been calculated as non-average rates
34 CFR 668.19534 CFR 668.214
Average Rates Appeal
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
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Appeals of Official CDR
School must send completed Average Rates Appeal to the Department within 30 days of timeframe begin date Supporting documentation
Certification
34 CFR 668.19534 CFR 668.214
Average Rates Appeal
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
Appeals of Official CDR
Department will automatically determine if school meets criteria for thirty or fewer borrowers appeal
34 CFR 668.19734 CFR 668.216
Thirty or Fewer Borrowers Appeal
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
Appeals of Official CDR
If school disagrees with Department’s determination School must send completed Thirty or Fewer Borrowers Appeal to the
Department within 30 days of timeframe begin date
Supporting documentation
Certification
34 CFR 668.19734 CFR 668.216
Thirty or Fewer Borrowers Appeal
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
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Take Action
Review the LRDR
Compare defaulted borrowers to your own system to ensure borrowers are listed correctly
Submit timely appeals, if necessary
Analyze defaulted borrowers to see if changes are needed in your default management plan
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
Resources
Default Prevention and Management ifap.ed.gov/DefaultManagement/Default
Management.html
eCDR Appeals System ecdrappeals.ed.gov
“Financial Aid Evolution: Change Agents” OASFAA Fall Conference 2015
“Financial Aid Evolution: Change
Agents”OASFAA Fall
Conference 2015
Thanks for Attending
Presented byDave Bowman, Regional Marketing DirectorGreat Lakes Educational Loan Services, Inc.