Table of Contents

Introduction...........................................................................1

General Information .............................................................5

Cohort Default Rate Calculation.................................................5

Definition of Cohort Default Rates .....................................5

Cohort Default Rate Types .................................................5
Loans Included in the Cohort Default Rate ......................7
Release of Cohort Default Rates .......................................8
Time Frames of a Cohort Period.......................................11
Calculating the Cohort Default Rate .................................13
Loans Included in the Denominator..................................20
Loans Included in the Numerator......................................21
Special Circumstances .......................................................24
Affect of Adding/Subtracting Loans to/from Cohort
Default Rate Calculation..................................................33

Cohort Default Rate Effects........................................................35

Types of Cohort Default Rate Sanctions .........................36

Consequences of Cohort Default Rate Sanctions..........37
Consequences Associated with Unsuccessful
Cohort Default Rate Adjustment/Appeals......................43
Exceptions to Cohort Default Rate Sanctions.................43
Types of Cohort Default Rates Benefits ..........................45

Loan Record Detail Report .........................................................47

Definition of a Loan Record Detail Report.......................47

Reviewing a Loan Record Detail Report..........................49
Title Section of Loan Record Detail Report.....................52
Body Section of Loan Record Detail Report ...................54
Summary Section of Loan Record Detail Report ...........61
Sample Loan Record Detail Report..................................65

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Electronic Loan Record Detail Report.....................................67

Definition of an Electronic Loan Record Detail

Report..................................................................................67
Format of an Electronic Loan Record Detail Report ......67
Procedures for Requesting an Electronic Loan
Record Detail Report ........................................................68

Repayment Information ...............................................................73

Definition of Repayment Information................................73

Format of Repayment Information....................................74
Benefits of Repayment Information ..................................75
Procedures for Requesting Summary Repayment
Information .........................................................................76
Procedures for Requesting Detailed File Format
Repayment Information ...................................................77

Information for Schools on Adjustments and

Appeals...............................................................................83
Uncorrected Data Adjustment ...................................................83

Part I: Background, Process, and Procedures .........83

Qualifying ..................................................................83
Definition of an Uncorrected Data Adjustment....83
Timing and Submitting ............................................89

Part II: Examples and Sample Material........................94

Example of a Situation that Warrants the

Submission of an Uncorrected Data
Adjustment..............................................................95
Sample Loan Record Detail Reports....................96
Sample Draft Data Challenge Response.............97
Uncorrected Data Adjustment Spreadsheet
Instructions .............................................................98
Sample Uncorrected Data Adjustment
Spreadsheet...........................................................99
Sample Uncorrected Data Adjustment Letter .....100

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New Data Adjustment...................................................................101

Part I: Background, Process, and Procedures .........101

Qualifying ..................................................................101
Definition of a New Data Adjustment....................101
Timing and Submitting ............................................116

Part II: Examples and Sample Material........................129

Example of a Situation that Warrants the

Submission of New Data Allegations .................130
Sample Loan Record Detail Reports....................131
New Data Allegations Spreadsheet
Instructions .............................................................132
Sample New Data Allegations Spreadsheet.......133
Sample New Data Allegations Letter....................134
Sample New Data Allegations Supporting
Documentation.......................................................135
Example of a Situation that Warrants the
Submission of a New Data Adjustment .............136
Sample New Data Allegations Response............137
New Data Adjustment Spreadsheet
Instructions .............................................................138
Sample New Data Adjustment Spreadsheet.......139
Sample New Data Adjustment Letter ...................140

Erroneous Data Appeal ...............................................................141

Part I: Background, Process, and Procedures .........141

Qualifying ..................................................................141
Definition of a New Data Adjustment....................141
Timing and Submitting ............................................159

Part II: Examples and Sample Material........................173

Example of a Situation that Warrants the

Submission of Erroneous Data Allegations.......174
Sample Loan Record Detail Reports....................175
Erroneous Data Allegations Spreadsheet
Instructions .............................................................176

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Sample Erroneous Data Allegations

Spreadsheet...........................................................177
Sample Erroneous Data Allegations Letter .........178
Sample Erroneous Data Allegations Supporting
Documentation.......................................................179
Example of a Situation that Warrants the
Submission of an Erroneous Data
Appeal.....................................................................180
Sample Erroneous Data Appeal Response ........181
Erroneous Data Appeal Spreadsheet
Instructions .............................................................182
Sample Erroneous Data Appeal Spreadsheet....183
Sample Erroneous Data Appeal Letter................184

Improper Loan Servicing and Collection Appeal..................185

Part I: Background, Process, and Procedures .........185

Qualifying ..................................................................185
Definition of a Improper Loan Servicing and
Collection Appeal .................................................185
Timing and Submitting ............................................200

Part II: Examples and Sample Material........................213

Example of a Situation that Warrants a

Request for Loan Servicing Records .................214
Sample Loan Record Detail Report......................215
Sample Request for Loan Servicing Records
Letter .......................................................................216
Example of a Situation that Warrants the
Submission of an Improper Loan Servicing
and Collection Appeal...........................................217
Improper Loan Servicing and Collection
Appeal Spreadsheet Instructions ........................218
Sample Improper Loan Servicing and
Collection Appeal Spreadsheet...........................219
Sample Improper Loan Servicing and
Collection Appeal Letter .......................................220

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Exceptional Mitigating Circumstances Appeals ...................221

General Information.............................................................221
Types of Exceptional Mitigating Circumstances
Appeals ...............................................................................221
Period of Time Associated with Exceptional
Mitigating Circumstances Appeals .................................226

Participation Rate Index Appeal................................................231

Part I: Background, Process, and Procedures .........231

Qualifying ..................................................................231
Definition of a Participation Rate Index................231
Timing and Submitting ............................................238

Part II: Examples and Sample Material........................245

Example of a Situation that Warrants the

Submission of a Participation Rate Index
Appeal.....................................................................247
Participation Rate Index Appeal Spreadsheet
Instructions .............................................................248
Sample Participation Rate Index Appeal
Spreadsheet...........................................................249
Sample Participation Rate Index Appeal Letter..250

Economically Disadvantaged and Placement

Rates Appeal................................................................................251

Part I: Background, Process, and Procedures .........252

Qualifying ..................................................................252
Definition of a Economically Disadvantaged
Rate .........................................................................252
Definition of a Placement Rate ..............................252
Timing and Submitting ............................................266

Part II: Supporting Material.............................................280

Sample Notice of Intent to File an Economically

Disadvantaged and Placement Rates Appeal
Letter .......................................................................281

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Economically Disadvantaged Rate Spreadsheet

Instructions .............................................................282
Sample Economically Disadvantaged Rate
Spreadsheet...........................................................283
Placement Rate Spreadsheet Instructions ..........284
Sample Placement Rate Spreadsheet.................285
Sample Economically Disadvantaged and
Placement Rates Appeal Letter ..........................286
Sample Independent Auditor’s Attestation for
an Economically Disadvantaged and
Placement Rates Appeal Letter ..........................287

Economically Disadvantaged and Completion

Rates Appeal................................................................................289

Part I: Background, Process, and Procedures .........290

Qualifying ..................................................................290
Definition of a Economically Disadvantaged
Rate .........................................................................290
Definition of a Placement Rate ..............................290
Timing and Submitting ............................................304

Part II: Supporting Material.............................................320

Sample Notice of Intent to File an Economically

Disadvantaged and Completion Rates Appeal
Letter .......................................................................321
Economically Disadvantaged Rate Spreadsheet
Instructions .............................................................322
Sample Economically Disadvantaged Rate
Spreadsheet...........................................................323
Completion Rate Spreadsheet Instructions.........324
Sample Completion Rate Spreadsheet................325
Sample Economically Disadvantaged and
Completion Rates Appeal Letter.........................326
Sample Independent Auditor’s Attestation for
an Economically Disadvantaged and
Completion Rates Appeal Letter.........................327

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Withdrawing an Adjustment or Appeal ...................................329

General Information.............................................................329
Timing and Submitting ........................................................330
Sample Withdrawing an Appeal Letter.............................333

Information for Guaranty Agencies on Adjustments and

Appeals...............................................................................335
General Information for Guaranty Agencies on
Adjustments and Appeals .......................................................335

Information for Guaranty Agencies on Monthly Status

Reports ..........................................................................................339

Monthly Status Report Spreadsheet Instructions ...........342

Monthly Status Report Sample Spreadsheet..................343

Information for Guaranty Agencies on Uncorrected Data

Adjustments .................................................................................345

Information for Guaranty Agencies on New Data

Adjustments ................................................................................347

Part I: Background, Process, and Procedures .........347

Timing a nd Submitting ............................................347

Part II: Examples and Sample Material........................356

Example of a Situation that Would Result in a

Response to New Data Allegations ....................357
New Data Response Spreadsheet
Instructions .............................................................358
Sample New Data Response Spreadsheet.........359
Sample New Data Response Letter .....................360

Information for Guaranty Agencies on Erroneous

Data Appeals ...............................................................................361

Part I: Background, Process, and Procedures .........361

Timing and Submitting ............................................361

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Part II: Examples and Sample Material........................372

Example of a Situation that Would Result in a

Response to Erroneous Data Allegations .........373
Erroneous Data Response Spreadsheet
Instructions .............................................................374
Sample Erroneous Data Response
Spreadsheet...........................................................375
Sample Erroneous Data Response Letter...........376

Information for Guaranty Agencies on Improper Loan

Servicing and Collection Appeals ..........................................377

Part I: Background, Process, and Procedures .........378

Timing and Submitting ............................................378

Part II: Examples and Sample Material........................389

Example of a Request for Payment for Loan

Servicing Records .................................................391
Sample Request for Payment for Loan
Servicing Records Letter......................................392
Example of a Response to a Request for Loan
Servicing Records .................................................393
Sample Loan Servicing Records Response
Letter .......................................................................394

Information for Guaranty Agencies on Exceptional

Mitigating Circumstances Appeals ........................................395

Appendices
Appendix A - Guaranty Agency/Direct Loan servicer
Contacts ........................................................................................1

Numerical Listing .................................................................3

Alphabetic Listing ................................................................15

Appendix B – Extract File Layout for Electronic Loan

Record Detail Reports and Repayment Information .........1

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Appendix C – Message Classes for Electronic Loan

Record Detail Reports ...............................................................1

Appendix D - User Comments on the FY 1998 Official

Cohort Default Rate Guide........................................................1

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