In a letter sent to the Department of Education (ED) on Monday, NASFAA asks for certain procedures to assist institutions and borrowers during the wind down of the Federal Perkins Loan Program.
The letter states that while it is our strong preference that the program continue until Congress can conduct a comprehensive review of the Title IV aid programs during reauthorization of the Higher Education Act, we must take steps now to ensure a smooth and equitable close-out process in the event that the program ends as scheduled on Sept. 30, 2017.
The letter makes several requests to protect institutions’ interests during the potential wind down of the program, including:
Accommodations to ensure an institution receives its fair share of the revolving fund in cases where it made one or more short-term loans to its loan fund, and subsequently repaid itself the lent amount;
Payments to institutions for unreimbursed loan cancellations;
If close-out audits will be required, the ability to charge the cost of the audit against the loan fund, and an extended deadline to secure an audit letter of engagement;
Flexibility for the institution to decide if it would prefer to continue servicing outstanding Perkins loans, or assign them to ED for servicing.
Publication Date: 6/13/2017