Federal Updates

ED publishes interim final rules for the FFELP and other federal student aid programs

ED has published interim final rules, effective September 8, 2006, for the federal student aid programs, including the FFELP. The regulations are available in the August 9, 2006, Federal Register at http://a257.g.akamaitech.net/7/257/2422/01jan20061800/edocket.access.gpo.gov/2006/pdf/06-6696.pdf.

Why "interim" final rules?
Under normal circumstances, ED develops final rules, or regulations, through a process called negotiated rulemaking, in which ED and a committee of industry representatives negotiate the construction of regulatory language. According to the Federal Register notice, based on the exceptional circumstance of the enactment of the Higher Education Reconciliation Act of 2005 (HERA) in February of this year, ED has determined "that it is unnecessary and impracticable to either conduct negotiated rulemaking or notice-and-comment rulemaking on these regulations." Instead, ED released these interim final rules and is requesting public comment on them through September 8, 2006. After it reviews comments received from the public, ED "will publish final regulations with any necessary changes to be effective July 1, 2007."

Upcoming teleconferences
TG will be presenting two teleconferences on the substantive information from the interim final rules in the next couple of weeks. For more information, see the article "TG offers two free telephone conferences on the interim final rules," also in this edition of Shoptalk Online.

More information
For questions about these recently released regulations, contact TG customer assistance at (800) 845-6267 or send an e-mail message to cust.assist@tgslc.org.

Back to Top

ED provides clarification on PLUS credit check timeframe

The National Council of Higher Education Loan Programs (NCHELP) recently posted in its Daily Briefing that it had received communication from ED concerning its policy regarding the timeframe in which a lender must request a PLUS loan borrower's credit report when determining adverse credit history. Recent industry buzz had indicated that ED was considering changing its policy to a specific timeframe; however, ED confirmed in its communication with NCHELP that schools and lenders should "continue to use current processes."

Current regulatory language pertaining to the PLUS credit check in 34 CFR 682.201(b)(2)(i) states that "The credit report must be secured within a timeframe that would ensure the most accurate, current representation of the borrower's credit history before the first day of the period of enrollment for which the loan is intended." The regulation does not specify the length of this timeframe.

More information
For more information on the PLUS credit check process, contact TG customer assistance at (800) 845-6267 or send an e-mail message to cust.assist@tgslc.org.

Back to Top