Ineligible Borrower Claims

    Based on guidance from the U.S. Department of Education (ED), the Utah Higher Education Assistance Authority (UHEAA) has determined that all ineligible borrower claims will be paid in the same manner as default claims, effective immediately.  This new guidance supersedes the information currently contained in the Common Manual, subsection 8.6.A.

    In accordance with regulations, when a lender determines that the borrower provided false or erroneous information or took actions that caused the borrower to be ineligible for all or a portion of a loan, the lender is required to send the borrower a final demand for payment. If the borrower does not pay the full amount of principal and interest due on the loan within 30 days of the date the final demand letter is mailed, the lender should file a default claim with UHEAA. ED has clarified that such claims are to be paid at 98% if the loan was disbursed on or after 10/1/93.

    Questions regarding this Bulletin should be directed to the UHEAA Policy and Training Department at (801) 321-7166 or by e-mail at cjudd@utahsbr.edu.