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  • 1

    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

  • 2

    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

  • 3

    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

  • 4

    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

  • 5

    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

  • 6

    Loan Record Detail Report (LRDR)

    Contains borrower information for Stafford

    loans that were used to calculate a

    schools draft or official cohort default rate

    Includes borrowers

    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

  • 7

    Reader-Friendly LRDR

    Loan Record Detail Report

    Data Manager

    Three-digit code used to identify entity

    reporting the information

    Guaranty Agency Department of Education

  • 8

    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

  • 9

    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

  • 10

    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

  • 11

    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

  • 12

    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

  • 13

    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

  • 14

    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

  • 15

    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 schools 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)

  • 16

    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 schools 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

  • 17

    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

  • 18

    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 auditors written opinion to the Department within 30 days of timeframe begin date

    Spreadsheet of students that qualify to be included

    Schools low-income rate and placement rate (non-degree-granting school)

    Schools 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

  • 19

    Appeals of Official CDR

    Department will automatically determine if school

    meets criteria for thirty or fewer borrowers appeal

    If school disagrees with Departments

    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

  • 20

    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

  • 21

    Resources

    ifap.ed.gov/DefaultManagement/Default

    Management.html

    ecdrappeals.ed.gov

    Default Prevention and Management

    eCDR Appeals System

    Thanks for Attending

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