ED Calls on Institutions to Share Repayment Information with Student Borrowers
By Maria Carrasco, NASFAA Staff Reporter
The Department of Education (ED) released an electronic announcement on Monday requesting that Title IV-participating institutions reach out to their former students and current borrowers with information on student loan repayment in an effort to ensure more borrowers enter repayment and stay current on their loans.
This request follows the department’s notice last month in which ED announced that on Monday, May 5, the Office of Federal Student Aid (FSA) would restart the Treasury Offset Program, and later in the summer, begin administrative wage garnishment for federal Direct Loan borrowers in default.
A data point shared by the department last month indicated that 38% of Direct Loan and department-held Federal Family Education Loan (FFEL) Program borrowers are in repayment and current on their student loans.
In order to raise awareness over the upcoming resumption of the collections process, ED wants institutions to conduct outreach to borrowers to remind them that they are obligated to repay federal student loans, suggest that they review information on StudentAid.gov about repayment options, and request that borrowers log into StudentAid.gov to update their profile with current contact information and to ensure that their loans are in good standing.
According to the electronic announcement, ED is requesting institutions to reach out to all borrowers who ceased to be enrolled at their institution since January 1, 2020, if they have their contact information.
While this outreach is not required for institutions to perform, ED wrote that ”maintaining the integrity” of the Title-IV loan programs has “always been a shared responsibility among student borrowers, the Department, and participating institutions.”
Furthermore, ED stressed the importance of institutions keeping their cohort default rates (CDR) low, or they could possibly lose Title-IV funding if their CDR exceeds 40% for a single year, or 30% for three consecutive years. ED reminded institutions that the repayment pause on student loans ended in October 2023, so CDRs published in 2026 will include borrowers who have entered default, since the payment pause and the on-ramp period have sunset.
“Although borrowers have the primary responsibility for repaying their student loans, institutions play a key role in the Department’s ongoing efforts to improve loan repayment outcomes, especially as the cost of college set solely by institutions has continued to skyrocket,” the electronic announcement reads. “Institutions are responsible for providing clear and accurate information about repayment to borrowers through entrance and exit counseling, and colleges and universities are responsible for disclosing annual tuition and fees and the net price to students and their families on the costs of a postsecondary education.”
ED urges schools to complete this outreach “no later than June 30, 2025.” However, since this is a request rather than an enforceable requirement, ED wrote that it will not stipulate on how this outreach is conducted, as long as the three listed categories are covered in the outreach. The department stressed that institutions' outreach should focus on borrowers who are delinquent on their loans, and will provide more information to help institutions identify and communicate with these borrowers.
ED also provided limited details about its plan to publish institutional "loan non-payment rates" on the FSA Data Center. ED indicated it will calculate these rates using existing federal student loan borrower repayment status data, which has previously been used for the College Scorecard. However, the specific definition or calculation method for these "non-payment" rates is currently unclear. ED stated that more information on this process will be released soon.
Stay tuned to Today’s News for more details on this electronic announcement.
Publication Date: 5/6/2025
Paul N | 5/6/2025 6:33:05 PM
The suggestion in the DCL to focus initial outreach on delinquent students is reasonable. However, I find it troubling that the DCL begins its outreach section with it “recommends/urges” sending correspondence to all borrowers while also assigning a June 30 deadline. Is this a requirement hence the deadline, or is this a recommendation based on the language?
Further, what is the loan non-payment rate to which they are referring? Is this the same as the cohort default rate (CDR) with which we are already familiar? If it is something different, will institutions receive a preliminary report for review and be able to submit edits/challenges to the data as is the current practice with the CDR each year?
Kim J | 5/6/2025 4:2:35 PM
Two things stand out:
1) This is not a mandate but a desire (urge) for schools to do this.
2) If one is in repayment, they are basically NOT a student. Our task is to assist our students.
I learned to differentiate while serving on the Board of a non-profit loan corporation many years ago and learned at the feet of two strong leaders in the nation ... Bill Mackie and Marvin Carmichael.
We do what we are able to assist our students and when a previous administration did away with FFELP, CDR's sky-rocketed and our ability to assist both students and borrowers plummeted ...
Korinne P | 5/6/2025 2:22:52 PM
Yes, right. Maybe if ED's staff hadn't been reduced, there would actually be people available to do this outreach. Instead, it seems the plan is to quietly shift yet another administrative task to schools under the label of “shared responsibility.” I want to support my students in repayment. Maybe I’ll get to it right after I finish the dozens of other unfunded mandates still sitting on my desk. At this point, I may need to create a separate inbox labeled "Do More With Less and Smile About It."
Stephanie S | 5/6/2025 11:53:06 AM
How is everyone approaching this?
Vincent F | 5/6/2025 10:21:05 AM
@Shavon S: Do you not have access to NSLDS?
Vincent F | 5/6/2025 10:20:24 AM
Yeah, I'll get right on that--not like I have anything better to do. Heck, we can't even get our CURRENT students to read their email!
Shavon S | 5/6/2025 8:8:01 AM
We no longer have access directly to Servicer data, can we use this as an opportunity to request the access back so we can better serve our student population?
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