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Transcript of Decoding CDR Reports, Appeals, Challenges and … · Decoding CDR Reports, Appeals, Challenges and...
Decoding CDR Reports, Appeals, Challenges and Adjustments
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
Administrative capability
Why Review Your CDR Data
Capturing the right data, accurate data, and timely data is critical for making good policy and accurate decisions
Administrative capability
Better-quality decision-making
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 Security and disability benefits
Administrative capability
Better service to students
Better-quality decision-making
Objectives Understanding the Cohort Default Rate
(CDR) cycle
Decoding the Loan Record Detail Report
Collecting and comparing data
Correcting data
Understanding the Cohort Default Rate Cycle
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
What is a Cohort Default Period?
Borrowers who entered
repayment between
10/01/2008 and
9/30/2009
Borrowers who entered
repayment between
10/01/2008 and
9/30/2009
Borrowers who entered
repayment between
10/01/2008 and 9/30/2009
and who defaulted between
10/01/2008 and 9/30/2010
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 9/30/2011
3-year CDR Example FY2009
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
February August
Draft default rates released to schools only
Official rates released to schools and the general public
September January
Draft Rate Cycle Official Rate Cycle
Source: CDR Quick Reference Guide
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 January
Draft Rate Cycle Official Rate Cycle
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
Publication of CDRs
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”
What is Included in the eCDR?
CDR package includes
Cover letter
Two Loan Record Detail Reports (LRDR)
– Reader-friendly
– Extract-type
Decoding the Loan Record Detail Report
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
Review LRDR Check for accuracy
Compare to school records
Repayment Date
Default Status
Cancellations/Refunds
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
Loan Record Detail Report – Data Manager
Three-digit code used to identify entity reporting the information
Guaranty Agency Department of Education
Reader-Friendly LRDR
Loan Record Detail Report – Repayment Date
Indicates when the borrower began repayment
Determines if the loan is included in the denominator
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
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
Important Codes to Know
Source: CDR Guide, page 2.3-8
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
Collecting the Data
Internal resources available on-campus
External resources
– NSLDS
– Servicer reports
– Guaranty agencies
Determine where
to find data
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
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
Estimated date
entered repayme
nt
5/5/2009
Actual date enter repaymen
t
Actual DER
5/13/2010
Default date
5/8/2011
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 Defaulted between 10/1/2008 – 9/31/2011 • Defaulted 5/8/2011
No FY2009 (10/1/2008 – 09/31/2009)
• Date Alex entered repayment 5/13/2010
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
Estimated 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
Should the Loan be Included in FY09 3-year CDR?
Sara
Deferments or forbearances do not alter the date the borrower entered repayment
Yes Defaulted between 10/1/2008 - 9/31/2011 • 2/14/2011 default
Yes FY2009 (10/1/2008 – 09/31/2009) • Date Sara entered repayment 05/05/2009
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
Estimated date
entered repayme
nt
12/2/2008
Actual date
entered repaymen
t 12/2/2008
Default date
5/27/2010
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 Defaulted between 10/1/2008 – 9/31/2011
• Quinn defaulted 5-27-2010
Yes FY2009 (10/1/2008 – 09/31/2009)
• Date Quinn entered repayment 12/02/2008
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
Estimated date
entered repayme
nt
12/2/2008
Actual date
entered repaymen
t Loan paid in full
7/1/2008
Default date
NA
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 Defaulted between 10/1/2008 – 9/31/2011
• No default
No FY2009 (10/1/2008 – 09/31/2009)
• Date Becca paid in full 07/01/2008
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)
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)
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 668.190
34 CFR 668.209
Uncorrected Data Adjustment (UDA)
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
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 668.191
34 CFR 668.210
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 668.193
34 CFR 668.212
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 668.193
34 CFR 668.212
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 within 15 days of data manager notification
Loan Servicing Appeal (LS)
34 CFR 668.193
34 CFR 668.212
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 668.192
34 CFR 668.211
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 668.192
34 CFR 668.211
Appeals of Official CDR
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)
Economically Disadvantaged Appeal (EDA)
34 CFR 668.184
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 668.195
34 CFR 668.214
Participation Rate Index Appeal (PRI)
Appeals of Official CDR
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
34 CFR 668.195
34 CFR 668.214
Average Rates Appeal
Appeals of Official CDR
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
34 CFR 668.197
34 CFR 668.216
Thirty or Fewer Borrowers Appeal
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
Resources
– ifap.ed.gov/DefaultManagement/Default Management.html
– ecdrappeals.ed.gov
Default Prevention and Management
eCDR Appeals System
Thanks for Attending