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 2002.

    Attached are interim updates to the Common Manual which address policy revisions approved on August 16, 2001.  Pay particular attention to the effective dates for these interim policy updates.

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

Lender of Last Resort (LLR)
Previous policy states that the guarantor will respond to the student's application for a lender of last resort (LLR) loan.  However, with the rapid development of electronic processes, the guarantor may receive the borrower's request in a number of formats.  Revised policy deletes the reference to the guarantor's receipt of an application and inserts the phrase "request from the borrower."  This phrase adds flexibility but continues to ensure that the guarantor responds within 60 days of receiving a complete request for an LLR loan.
 

Affected Sections:	3.7.C.
Effective Date:	LLR loan requests from the borrower received by the guarantor on or after the implementation of the Master Promissory Note (MPN).
Basis:	HEA 432(m); DCL GEN-98-25/98-G-315/98-L-211.

 

Claim Recalls
The Common Manual has been updated to clarify that a lender is required to recall a claim if it approves a forbearance agreement that brings the loan to 210 or fewer days delinquent.
 

Affected Sections:	8.5, CCI8.5
Effective Date:	Retroactive to the implementation of the Common Manual.
Basis:	§682.211.

 

Cure Procedures
The Common Manual has been revised to inform lenders that they may begin cure activities immediately upon the discovery of a loss of guarantee.  It is to the lender's advantage to begin cure activities as quickly as possible in order to avoid losing contact with the borrower.  In addition, beginning cure activities immediately upon the discovery of a loss of guarantee may reduce the lender's loss of interest benefits and special allowance.   Regulations still require that cure activities be completed not later than 3 years from either:

1. The last date the loan could have been filed timely as a claim with the guarantor, if the claim was not filed.
2. If the claim was filed, the date the guarantor returned the claim for loss of guarantee.
 

Affected Sections:	8.8.F., CCI8.8.F.
Effective Date:	Retroactive to the implementation of the Common Manual.
Basis:	None.

 

Pro Rata Refunds
As a result of the implementation of the return of Title IV funds requirements, pro rata refunds have been eliminated.  Therefore, the Common Manual has been updated by replacing, in the list of common program review findings for schools, the bullet that addresses the incorrect application of a pro rata refund policy with a bullet that addresses the incorrect application of the return of Title IV funds requirements.  In addition, the definition of pro rata refunds has been removed from appendix G.
 

Affected Sections:	11.3.C., appendix G
Effective Date:	Title IV recipients who withdrew on or after October 7, 2000, unless implemented earlier by the school on or after November 1, 1999.
Basis:	§668.22-as updated in the Federal Register dated November 1, 1999.