ED Confirms No Resolution Required for Comment Code 352
By Hugh T. Ferguson, NASFAA Managing Editor
The Department of Education (ED), in an electronic announcement on Tuesday, explained that, effective immediately, institutions should disregard the FPS C Flag associated with Comment Code 352 while the department updates its logic to ensure that the FAFSA Processing System (FPS) no longer sets a C flag for postscreening Reason Code 34/Comment Code 352.
According to ED’s notice, schools should not delay awarding or disbursing aid if it is based only on the presence of this FPS C Flag.
Prior to Tuesday’s notice, NASFAA provided Federal Student Aid (FSA) with feedback from members identifying ISIRs with comment code 352 and requesting guidance on resolving the associated C Flag, because ED had not provided instructions on how to resolve this C Flag, which began appearing on significant numbers of ISIR transactions being sent to institutions over the past several weeks after updates were made to several ED systems.
ED explained that comment code 352 appeared on reprocessed ISIRs as a result of the Common Origination and Disbursement (COD) system setting the value for its loan limit exception flag to “Yes” for borrowers it identified as meeting the criteria for the interim exception to the new federal loan limits established in the One Big Beautiful Bill Act. That information passed to the National Student Loan Data System (NSLDS), where the postscreening process identified that the value of the field changed and triggered comment code 352 and a corresponding C flag to appear on new ISIR transactions sent to schools.
ED acknowledged, however, that the decision to flag these transactions with a C Flag was inappropriate.
“We are aware that the FPS C Flag has caused confusion since FPS C Flags generally signal that an institution must resolve an eligibility issue before awarding and disbursing aid,” the announcement reads. “In response to feedback from the financial aid community, ED is taking steps to update its logic to no longer set an FPS C Flag for post-screening Reason Code 34/Comment Code 352.”
ED will begin reprocessing ISIRs to remove the C Flag associated with Comment Code 352 starting June 11.
For additional guidance, institutions can refer to Frequently Asked Questions about loan limits published on the Knowledge Center.
Publication Date: 6/9/2026
