ED Clarifies Exit Counseling Requirements for Student Reservists Called to Active Duty

NASFAA continues to receive questions about exit counseling for student reservists who are called to active duty.

The most recently published Department of Education guidance, GEN-01-13, said that "If a borrower's loans are in an in-school status, an in-school deferment status, or in a grace period status when the borrower is ordered to active duty or reassigned, the lender must maintain the loans in that status during the period of the borrower's active duty service or reassignment, plus the time necessary for the borrower to resume enrollment in the next regular enrollment period that is reasonably available to the borrower, if the borrower wishes to go back to school. However, this maintenance of loan status may not exceed a total of three years including the period of time necessary for the borrower to resume enrollment."

ED has clarified the guidance contained in GEN-01-13 in verbal conversations with NASFAA. According to Department officials, since a borrower who is ordered to active duty while in an in-school status retains that status for up to three years, including the time needed for the borrower to resume enrollment, "the school does not need to send written counseling materials unless the student does not return to school by the end of the three-year period."

However, if the school chooses to send the exit counseling materials at the time the student is called to active duty, ED would consider the school to have met the exit counseling requirements if the student does not return to the school. "If the student does return to the school after military service, the school will have to comply with the exit counseling requirements again before the student graduates or otherwise ceases to be enrolled at least half-time," ED noted.

By Elizabeth B. Guerard
NASFAA Assistant Director of Communications

Posted February 26, 2003 on www.NASFAA.org, the Web Site of the
National Association of Student Financial Aid Administrators (NASFAA).
Copyright 2003.
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