Common Manual Interim Policy Updates

As you are aware, the Common Manual Governing Board periodically approves modifications to the Common Manual.  Recently, several policies were approved to modify the Common Manual. These changes will be incorporated into the Common Manual when the next annual update is published in July 2000.

Attached are interim updates to the Common Manual which address policy revisions approved on February 17, 2000.  Pay particular attention to the effective dates for these interim policy updates.

Any questions related to the attached Common Manual interim policy update should be directed to the UHEAA Policy and Training Department at (801) 321-7166 or by email at cjudd@utahsbr.edu.

Attachment

Backdating Exception for In-School Deferments
The Common Manual has been revised to clarify that in-school deferments are not bound to the 6-month backdating rule that applies to other types of deferment. The lender must grant an in-school deferment for each eligible period of enrollment and may bill the Department for interest benefits on a subsidized Stafford loan, regardless of the date enrollment began. This change reflects Final Rules published in the Federal Register on October 29, 1999.  Lenders may implement this provision earlier than the regulatory effective date to maximize the benefit to FFELP borrowers.

Affected Sections: 7.9.A., 7.10.A., A.1.B.
Effective Date:  In-school deferments granted on or after July 1, 2000, unless implemented earlier by the lender.

Unemployment Benefits Documentation Acceptable for Unemployment Deferment
The Common Manual has been revised to incorporate an unemployment deferment provision of Final Rules published in the Federal Register dated November 1, 1999.  A lender may grant an unemployment deferment to a borrower who requests an unemployment deferment and provides to the lender evidence of the borrower's eligibility to receive unemployment benefits. In this case, the borrower need not provide the lender with the common deferment form or other additional information or documentation.

Affected Sections: 7.10.E.
Effective Date:  Unemployment deferments granted on or after July 1, 2000, unless implemented earlier by the lender.

Endorser Due Diligence
The Common Manual has been revised to incorporate endorser due diligence provisions of Final Rules published in the Federal Register on October 29, 1999.  Under these provisions, the lender must complete  endorser due diligence requirements before filing a default claim.  Prior Common Manual policy required the lender to complete endorser due diligence during the delinquency period of the loan.

Affected Sections:   8.1.E., and CCI8.1.E.
Effective Date:   Default claims for which the first day of delinquency on the oldest outstanding due date is on or after July 1, 2000, unless implemented earlier by the guarantor.