TG Implements Regulatory Change for Default Aversion Assistance Requests
Effective for loans with past due dates on or after July 1, 2000, Texas Guaranteed Student Loan Corporation (TG) is changing the time frame during which lenders must submit a request for default aversion assistance. This policy change is in accordance with the November 1999 revision to 34 CFR 682.404(k)(1).
The new regulation requires that a lender's request for assistance be submitted to the guaranty agency no earlier than the 60th day and no later than the 120th day of the borrower's delinquency. TG will allow an additional five days for mail time, but will consider as late any default aversion requests it receives after the 125th day of delinquency. Rejected requests also must be received by the 125th day. To avoid penalties, lenders and servicers must plan to submit default aversion requests in time to deal with any reject issues and resubmit so that the submittal is received within the 125-day time frame.
Before July 1, 2000, TG required lenders to submit a request for default aversion assistance effective for loans with past due dates on or after July 1, 1999, between the 60th and 80th day of delinquency.
The experience of both schools and TG has demonstrated that early intervention in delinquencies is a significant factor in successful resolution. TG, therefore, urges lenders to continue to file requests between the 60th and 80th day of delinquency.
Related Form Changes
Because of the implementation of CAM-CCI Preclaims and the accompanying common Preclaim Request Form in July 2000, TG will not be revising its Lender Request for Assistance (RFA), Form 201. Lenders and servicers that submit default aversion requests by hard copy should continue to use the current form until they convert to the common Preclaim Request Form, even though Section D contains a field to mark if the account is 60-80 days past due. Lenders should change the field to read "60 to 120 days past due" and continue marking the field when appropriate. After January 5, 2001, TG will discontinue the RFA, Form 201. At that time all lenders and servicers will be required to use the common Preclaim Request Form for hard copy submissions to comply with the CAM-CCI Preclaims implementation.
For questions about these policy changes, contact Art Cruz at (800) 252-9743, ext. 4934, or Shelia Dunlap at ext. 4642. Questions may also be sent by to email@example.com or firstname.lastname@example.org.
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