decoding cdr reports and correcting data - … · decoding cdr reports and correcting data why...
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Decoding CDR Reports and
Correcting Data
Why Review Your CDR Data
– A high CDR could result in
• Adverse publicity
• Loss of Title IV eligibility
• Loss of access to private loan funds
• Extra work due to loss of benefits or added
sanctions
Administrative capability
Why Review Your CDR Data
– Capturing the right data, accurate data, and
timely data is critical for making good policy
and accurate decisions
Administrative capability
Better-quality decision-making
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Why Review Your CDR Data
– When borrowers default
• They pay more in interest and collections fees
• The government can seize wages, tax refunds,
and Social Security and disability benefits
Administrative capability
Better service to students
Better-quality decision-making
Objectives
• Understand the Cohort Default
Rate (CDR) cycle
• Decode the Loan Record Detail Report
• Learn how to collect, compare, and
correct data
• Know common appeal errors to avoid
Understanding the Cohort
Default Rate Cycle
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What Is a Cohort Default Rate?
The Numerator is the
number of Stafford loan
borrowers from the
denominator who default
within a cohort period
The Denominator is the
number of Stafford loan
borrowers who enter
repayment within a
cohort period
= Did not default
in 2011-2013
= Defaulted
in 2011
= Defaulted
in 2012
= Defaulted
in 2013
All borrowers entered
repayment in 2011
What Is a Cohort Default Period?
Borrowers who entered
repayment between
10/01/2010 and
9/30/2011
Borrowers who entered
repayment between
10/01/2010 and
9/30/2011
Borrowers who entered
repayment between
10/01/2010 and 9/30/2011
and who defaulted between
10/01/2010 and 9/30/2012
2-year CDR Example FY2011
Borrowers who entered
repayment between
10/01/2010 and 9/30/2011
and who defaulted between
10/01/2010 and 9/30/2013
3-year CDR Example FY2011
What Is a Cohort Default Rate
Cycle?
• The Department sends draft and official cohort
default rates to all schools that
– Are eligible to participate in any of the Title IV
programs
– Have had a borrower in repayment in the current or
any of the past cohort default rate periods
February August
Draft default rates released
to schools only
Official rates released to
schools and the general public
September January
Draft Rate Cycle Official Rate Cycle
Source: CDR Quick Reference Guide
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What Is a Cohort Default Rate
Cycle?
• The official cohort default rates are available to
the public through a searchable database at:
– ed.gov/FSA/defaultmanagement/cdr.html
Source: CDR Quick Reference Guide
February August
Draft default rates released
to schools only
Official rates released to
schools and the general public
September January
Draft Rate Cycle Official Rate Cycle
No Sanctions or Benefits
Associated with Draft CDR
• Keep in mind
– Schools that fail to challenge the accuracy of
draft cohort default rate data through an
incorrect data challenge may not contest the
accuracy of the data used in the official rate
Fiscal
Year
(FY)
Denominator
# in
Repayment
Numerator
# in Default
Draft CDR
Publication
Date
Official CDR
Publication
Date
Rate Used for
Sanctions
2010 10/01/09 – 09/30/10 3-yr: 10/01/09 – 09/30/12 3-yr: Feb 2013 3-yr: Sept 2013 N/A
2011 10/01/10 – 09/30/11 2-yr: 10/01/10 – 09/30/12
3-yr: 10/01/10 – 09/30/13
2-yr: Feb 2013
3-yr: Feb 2014
2-yr: Sept 2013
3-yr: Sept 2014
2-yr rate (25%)
3-yr rate (30%)
2012 10/01/11 – 09/30/12 3-yr: 10/01/11 – 09/30/14 3-yr: Feb 2015 3-yr: Sept 2015 3-yr rate (30%)
Publication of CDRs
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How Are Schools Notified?
• CDR notification packages
– Sent electronically to all domestic schools
(eCDR)
• Using Student Aid Internet Gateway (SAIG)
• Allowed five business days to report problems
• Timelines for submitting challenges, adjustments,
and appeals begin six days following announced
transmission date, as posted on IFAP (ifap.ed.gov)
What is Included in the eCDR?
• CDR package includes
– Cover letter
– Two Loan Record Detail Reports (LRDR)
• Reader-friendly
• Extract-type
• CDR package includes
– SHDRLROP
– SHCDRROP
– SHCDREOP
– Cover letter
– Loan Record Detail
Reports (LRDR) • Reader-friendly
• Extract-type
Decoding the Loan Record
Detail Report
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Loan Record Detail Report (LRDR)
• Contains borrower information for Stafford
loans that were used to calculate a
school’s draft or official cohort default rate
– Includes borrower’s
• Name, Social Security number
• Date borrower entered repayment
• Date of default (if applicable)
• Loan type
– Borrowers with multiple loans will be
counted only once
Review LRDR
• Check for accuracy
• Compare to school records
– Repayment Date
– Default Status
– Cancellations/Refunds
What is Included in the eCDR?
• Beginning with the
FY 2009 cohort all
schools MUST use
eCDR Appeals to
prepare and submit
challenges or
adjustments
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Reader-Friendly LRDR
Loan Record Detail Report –
Data Manager
• Three-digit code used to identify entity
reporting the information
Guaranty Agency Department of Education
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Loan Record Detail Report –
Repayment Date
• Indicates when the borrower began repayment
• Determines if the loan is included in
the denominator
Loan Record Detail Report –
Default Date
• Indicates the date – A Direct Loan is considered in default based on its past due
status
OR
– Guarantee agency paid a default claim to a lender for a FFELP
Loan
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Loan Record Detail Report –
CDR Usage
• Indicates how the loan is included in the calculation
– “D” Denominator only
– “B” Both Numerator and Denominator
– “N” Not Used
– “E” Eligible, but not counted
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Important Codes to Know
Source: CDR Guide, page 2.3-7
Important Codes to Know
Source: CDR Guide, page 2.3-8
Collecting and Comparing
Data
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Collecting the Data
• Determine data that needs to be captured
– Last date of attendance (LDA)
– Less than half-time date (LTH)
– Withdrawal date (WD)
– Date entered repayment (DER)
– Claim paid date/default date (CPD/DD)
• Use a spreadsheet or database to collect
this data
– Implement this process early
Collecting the Data
– Internal resources
available on-campus
– External resources
• NSLDS
• Servicer reports
• Guaranty agencies
Determine where
to find data
Possible Errors on LRDR
• LRDR incorrectly:
– Reports a data element and the data element
should be changed
– Includes a borrower whose repayment date
does not fall within the cohort fiscal year and
the borrower should be removed from the
cohort rate calculation
– Excludes a borrower who entered repayment
within the cohort and the borrower should be
added to the cohort rate calculation
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Should the Loan be Included in
FY09 3-year CDR?
Darin
• Graduated from your school 11/4/2008
• NSLDS reveals Darin transferred to another school on 2/4/2009
LDA
11/4/2008
Add 6 months,
1 day
5/5/2009
Date entered repayment
Actual DER
5/13/2010
Default date
5/8/2011
Should the Loan be Included in
FY09 3-year CDR? No
Y Defaulted between 10/1/2008 – 9/31/2011 • Defaulted 5/8/2011
N FY2009 (10/1/2008 – 09/31/2009)
• Date Darin entered repayment 5/13/2010
If date of repayment is delayed by re-enrolling in school prior to the end of grace, inclusion in a CDR calculation is also delayed
Darin
Should the Loan be Included in
FY09 3-year CDR?
• Left your school 11/4/2008
• Transferred to another school 1/12/2010
• Loans are deferred on 1/12/2010
LDA
11/4/2008
Add 6 months,
1 day
5/5/2009
Date entered repayment
05/05/2009
(Loan deferred 1/12/2010)
Default date
NA
Kara
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Should the Loan be Included in
FY09 3-year CDR? Yes
Deferments or forbearances do not alter the date the borrower entered repayment
N Defaulted between 10/1/2008 - 9/31/2011 • No default
Y FY2009 (10/1/2008 – 09/31/2009)
• Date Kara entered repayment 05/05/2009
Kara
Should the Loan be Included in
FY09 3-year CDR?
• Withdrew from your school 6/1/2008
• Defaulted on loans 05/27/2010
• Consolidated three loans 12/4/2010 in order to regain Title IV eligibility
LDA
6/1/2008
Add 6 months,
1 day
12/2/2008
Date entered repayment
12/2/2008
Default date
5/27/2010
Kyle
Should the Loan be Included in
FY09 3-year CDR? Yes
Y Defaulted between 10/1/2008 – 9/31/2011
• Kyle defaulted 5/27/2010
Y FY2009 (10/1/2008 – 09/31/2009)
• Date Kyle entered repayment 12/02/2008
The date underlying loans entered repayment is the date used in the cohort default rate calculation
Kyle
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Should the Loan be Included in
FY09 3-year CDR?
• Graduated from your school 6/1/2008
• Paid loan in full on 7/1/2008
LDA
6/1/2008
Add 6 months,
1 day
12/2/2008
Date entered repayment
Loan paid in full 7/1/2008
Default date
NA
Bethany
Should the Loan be Included in
FY09 3-year CDR? No
The paid-in-full date becomes the new repayment date
Same is true for loans discharged due to death, bankruptcy, disability
Defaulted between 10/1/2008 – 9/31/2011
• No default
FY2009 (10/1/2008 – 09/31/2009)
• Date Bethany paid in full 07/01/2008
N
N
Bethany
Correcting Data
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Challenges of Draft CDR
– Used to correct errors on the draft CDR
– Submitted by school to guarantors (FFEL)
and/or DL servicers via eCDR Appeals within
45 days of timeframe begin date
• Relevant information for each borrower challenged
• Supporting documentation for each borrower
challenged
• CEO Certification Letter
34 CFR 668.185(b)
34 CFR 668.204(b)
Incorrect Data Challenge (IDC)
Challenges of Draft CDR
– Only available if a school is potentially subject to a loss of eligibility (or provisional certification) based on draft rates
– School must send completed PRI Challenge to the U.S. Department of Education within 45 days of timeframe begin date
• PRI Challenge Spreadsheet (CDR Guide page 4.2 – 8)
• Letter
Participation Rate Index Challenge (PRI)
34 CFR 668.185(c)
Adjustments of Official CDR
– Ensures that a school’s official cohort default
rate calculation reflects changes that were
correctly agreed to as a result of an incorrect
data challenge
– School must submit its UDA to the
Department within 30 calendar days of
timeframe begin date via eCDR Appeals
system
34 CFR 668.190
34 CFR 668.209
Uncorrected Data Adjustment (UDA)
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Adjustments of Official CDR
– Allows a school to challenge the accuracy of “new
data” included in most recent official CDR
• Compare LRDR of draft CDR to LRDR of official CDR to
determine if new data is reported correctly
– School must submit its NDA to Data Manager via
eCDR Appeals within 15 days of timeframe begin
date
• Relevant information for each borrower challenged
• Supporting documentation each borrower challenged
• CEO Certification Letter
New Data Adjustment (NDA)
34 CFR 668.191
34 CFR 668.210
Appeals of Official CDR
– Alleges a school’s official cohort default
rate includes defaulted loans that are
considered improperly serviced for cohort
default rate purposes
– Example
• Borrower never made a loan payment and school
can document that lender/servicer failed to
complete due diligence
Loan Servicing Appeal (LS)
34 CFR 668.193
34 CFR 668.212
Appeals of Official CDR
– School must send request for loan
servicing records to Data Manager and
to the Department within 15 days of
timeframe begin date
Loan Servicing Appeal (LS)
34 CFR 668.193
34 CFR 668.212
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Appeals of Official CDR
– Data Manager notifies school and the
Department within 20 days of receipt
of request
• Fees for providing records
• List of representative sample
• Description of how sample was chosen
– School must pay the fee, if charged within
15 days of data manager notification
Loan Servicing Appeal (LS)
34 CFR 668.193
34 CFR 668.212
Appeals of Official CDR
– Available if the school is subject to a loss of
eligibility (or provisional certification) based on
official rates; or
– If the school previously challenged the
accuracy of data as part of its Incorrect Data
Challenge, or
– If a review of loan record detail reports for
draft and official rates show new data
Erroneous Data Appeal (ER)
34 CFR 668.192
34 CFR 668.211
Appeals of Official CDR
– School must send the Erroneous Data Appeal
allegations to Data Manager within 15 days of
timeframe begin date
• Erroneous Data Appeal spreadsheet
• Relevant pages of Loan Record Detail Report
• Supporting documentation
• Letter
Erroneous Data Appeal (ER)
34 CFR 668.192
34 CFR 668.211
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Appeals of Official CDR
– Available based on a loss of eligibility or notice of second successive official rate potentially subjecting school to provisional certification
– School must submit an independent auditor’s written opinion to the Department within 30 days of timeframe begin date
• Spreadsheet of students that qualify to be included
– School’s low-income rate and placement rate (non-degree-granting school)
– School’s low-income rate and completion rate (degree-granting school)
Economically Disadvantaged Appeal (EDA)
34 CFR 668.184
Appeals of Official CDR
– Only available if a school is subject to a loss of eligibility or provisional certification based on official rates
– School must send completed Participation Rate Index Appeal to the Department within 30 days of timeframe begin date
• Participation Rate Index Appeal spreadsheet
• Letter
34 CFR 668.195
34 CFR 668.214
Participation Rate Index Appeal (PRI)
Appeals of Official CDR
– Subject to sanctions based on three consecutive CDRs
that meet or exceed the relevant threshold if
• At least two of their official cohort default rates are
average rates
• CDRs would have been less than the relevant threshold if they had been
calculated as non-average rates
– School must send completed Average Rates Appeal to the
Department within 30 days of timeframe begin date
• Supporting documentation
• Certification
34 CFR 668.195
34 CFR 668.214
Average Rates Appeal
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Appeals of Official CDR
– Department will automatically determine if school
meets criteria for thirty or fewer borrowers appeal
– If school disagrees with Department’s
determination • School must send completed Thirty or Fewer Borrowers
Appeal to the Department within 30 days of timeframe begin
date
– Supporting documentation
– Certification
34 CFR 668.197
34 CFR 668.216
Thirty or Fewer Borrowers Appeal
Common Appeal Errors to
Avoid
Avoid Two Common Errors
1) Check NSLDS for a student's
enrollment status
– Students who have withdrawn or dropped to
less than half-time status may be taking
classes that maintain their eligibility elsewhere
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Two Common Errors
2) If two entities are listed for a loan, make
sure you send any challenges to the
correct entity
– The one indicated with a usage code of “B”
rather than with an “E”
– Sending your challenge to the wrong servicer
or guarantor can cause you to miss your
deadline
Conclusion and Resources
Take Action
• Review the LRDR
• Compare defaulted borrowers to your
own system to ensure borrowers are
listed correctly
• Submit timely appeals, if necessary
• Analyze defaulted borrowers to see
if changes are needed in your default
management plan
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Resources
– ifap.ed.gov/DefaultManagement/Default
Management.html
– ecdrappeals.ed.gov
Default Prevention and Management
eCDR Appeals System
Thanks for Attending