Decoding CDR Reports, Appeals, Challenges and Adjustments

Transcription

1 Decoding CDR Reports, Appeals, Challenges and Adjustments

2 Why Review Your CDR Data Administrative capability 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

3 Why Review Your CDR Data Administrative capability Better-quality decision-making Capturing the right data, accurate data, and timely data is critical for making good policy and accurate decisions

4 Why Review Your CDR Data Administrative capability Better-quality decision-making Better service to students When borrowers default They pay more in interest and collections fees The government can seize wages, tax refunds, and Social Security and disability benefits

5 Objectives Understanding the Cohort Default Rate (CDR) cycle Decoding the Loan Record Detail Report Collecting and comparing data Correcting data

6 Understanding the Cohort Default Rate Cycle

7 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

8 What is a Cohort Default Period? 2-year CDR Example FY2009 Borrowers who entered repayment between 10/01/2008 and 9/30/2009 and who defaulted between 10/01/2008 and 9/30/2010 Borrowers who entered repayment between 10/01/2008 and 9/30/ year CDR Example FY2009 Borrowers who entered repayment between 10/01/2008 and 9/30/2009 and who defaulted between 10/01/2008 and 9/30/2011 Borrowers who entered repayment between 10/01/2008 and 9/30/2009

9 What is a Cohort Default Rate Cycle? Draft Rate Cycle Official Rate Cycle February August September January Draft default rates released to schools only Official rates released to schools and the general public 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

10 What is a Cohort Default Rate Cycle? Draft Rate Cycle Official Rate Cycle February August September January Draft default rates released to schools only Official rates released to schools and the general public 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

11 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

12 Publication of CDRs

13 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

14 What is Included in the ecdr? CDR package includes Cover letter Two Loan Record Detail Reports (LRDR) Reader-friendly Extract-type

15 Decoding the Loan Record Detail Report

16 Loan Record Detail Report (LRDR) Contains borrower information for Stafford 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

17 Review LRDR Check for accuracy Compare to school records Repayment Date Default Status Cancellations/Refunds

18 What is Included in the ecdr? Beginning with the FY 2009 cohort all schools MUST use ecdr Appeals to prepare and submit challenges or adjustments

19 Loan Record Detail Report Data Manager Three-digit code used to identify entity reporting the information Guaranty Agency Department of Education

20 Reader-Friendly LRDR

21 Loan Record Detail Report Repayment Date Indicates when the borrower began repayment Determines if the loan is included in the denominator

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23 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

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25 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

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27 Important Codes to Know Source: CDR Guide, page 2.3-7

28 Important Codes to Know Source: CDR Guide, page 2.3-8

29 Collecting and Comparing Data

30 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

31 Collecting the Data Determine where to find data Internal resources available on-campus External resources NSLDS Servicer reports Guaranty agencies

32 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

33 Should the Loan be Included in FY09 3-year CDR? Alex Graduated from your school 11/4/2008 NSLDS reveals Alex transferred to another school on 2/4/2009 LDA 11/4/2008 Estimate d date entered repayme nt 5/5/2009 Actual date enter repaymen t Actual DER 5/13/2010 Default date 5/8/2011

34 Should the Loan be Included in FY09 3-year CDR? Alex 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 No No Defaulted between 10/1/2008 9/31/2011 Defaulted 5/8/2011 FY2009 (10/1/ /31/2009) Date Alex entered repayment 5/13/2010

35 Should the Loan be Included in FY09 3-year CDR? Sara Left your school 11/4/2008 Transferred to another school 1/12/2010 Loans are deferred on 1/12/2010 LDA 11/4/2008 Estimate d date entered repayme nt 5/5/2009 Actual date entered repaymen t 05/05/2009 (Loan deferred 1/12/2010) Default date 5/14/2011

36 Should the Loan be Included in FY09 3-year CDR? Sara Deferments or forbearances do not alter the date the borrower entered repayment Yes Yes Defaulted between 10/1/2008-9/31/2011 2/14/2011 default FY2009 (10/1/ /31/2009) Date Sara entered repayment 05/05/2009

37 Should the Loan be Included in FY09 3-year CDR? Quinn Withdrew from your school 6/1/2008 Defaulted on loans 05/27/2010 Consolidated three loans 12/4/2010 in order to regain Title IV eligibility LDA 6/1/2008 Estimate d date entered repayme nt 12/2/2008 Actual date entered repaymen t 12/2/2008 Default date 5/27/2010

38 Should the Loan be Included in FY09 3-year CDR? Quinn The date underlying loans entered repayment is the date used in the cohort default rate calculation Yes Yes Defaulted between 10/1/2008 9/31/2011 Quinn defaulted FY2009 (10/1/ /31/2009) Date Quinn entered repayment 12/02/2008

39 Should the Loan be Included in FY09 3-year CDR? Becca Graduated from your school 6/1/2008 Paid loan in full on 7/1/2008 LDA 6/1/2008 Estimate d date entered repayme nt 12/2/2008 Actual date entered repaymen Loan t paid in full 7/1/2008 Default date NA

40 Should the Loan be Included in FY09 3-year CDR? Becca The paid-in-full date becomes the new repayment date Same is true for loans discharged due to death, bankruptcy, disability No No Defaulted between 10/1/2008 9/31/2011 No default FY2009 (10/1/ /31/2009) Date Becca paid in full 07/01/2008

41 Correcting Data

42 34 CFR (b) 34 CFR (b) Challenges of Draft CDR Incorrect Data Challenge (IDC) 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

43 34 CFR (c) Challenges of Draft CDR Participation Rate Index Challenge (PRI) 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

44 34 CFR CFR Adjustments of Official CDR Uncorrected Data Adjustment (UDA) 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

45 Adjustments of Official CDR New Data Adjustment (NDA) 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 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 34 CFR CFR

46 34 CFR CFR Appeals of Official CDR Loan Servicing Appeal (LS) 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

47 34 CFR CFR Appeals of Official CDR Loan Servicing Appeal (LS) School must send request for loan servicing records to Data Manager and to the Department within 15 days of timeframe begin date

48 34 CFR CFR Appeals of Official CDR Loan Servicing Appeal (LS) 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 within 15 days of data manager notification

49 34 CFR CFR Appeals of Official CDR Erroneous Data Appeal (ER) 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

50 34 CFR CFR Appeals of Official CDR Erroneous Data Appeal (ER) 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

51 34 CFR Appeals of Official CDR Economically Disadvantaged Appeal (EDA) Available based on a loss of eligibility or notice of second successive official rate potentially subjecting school to provisional certification School must submit an independent auditor s written opinion to the Department within 30 days of timeframe begin date 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)

52 34 CFR CFR Appeals of Official CDR Participation Rate Index Appeal (PRI) 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

53 34 CFR CFR Appeals of Official CDR Average Rates Appeal Subject to sanctions based three consecutive CDRs that meet or exceed the relevant threshold if At least two of their official cohort default rates are average rates CDRs would have been less than the relevant threshold if they had been calculated as non-average rates School must send completed Average Rates Appeal to the Department within 30 days of timeframe begin date Supporting documentation Certification

54 34 CFR CFR Appeals of Official CDR Thirty or Fewer Borrowers Appeal Department will automatically determine if school meets criteria for thirty or fewer borrowers appeal 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

55 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

56 Resources Default Prevention and Management ifap.ed.gov/defaultmanagement/default Management.html ecdr Appeals System ecdrappeals.ed.gov

57 Thanks for Attending