05 - Business Operations Servicing Requirements.pdf

Version: 5 1 5/22/2024

Business Operations Servicing Requirements- Perkins

Version: 5 2 5/22/2024

Revision History

VERSION DATE AUTHOR DESCRIPTION

Version: 5 3 5/22/2024

TABLE OF CONTENTS

Section Category Deferred Future CLIN 7 Requirements

2000 Accessibility

3000 Website and applications 3002.030, 3002.031, 3002.050, 3002.070

4000 Common Origination and Disbursement Interface

5000 Repayment Plans

9000 Treasury

12000 NSLDS

14000 Interaction with DMCS

17000 Compliance & Monitoring

18000 Servicing Transfers

19000 System Access

20000 Processing - General 20014.000

21000 Deferments

22000 Forbearances

23000 Discharges, Forgiveness, Bankruptcy, and Litigation 23003.000

24000 Correspondence, Communication & Due Diligence 24019.020, 24019.051

25000 Borrower Benefits & Subsidies

26000 Interest Rates, Interest Calculation, Charges and Fees

28000 Payment & Refund Processing 28008.031, 28008.040, 28015.031 29000 Adjustment Processing

30000 Credit Reporting & Processing 30027.000, 30027.010, 30027.020

32000 Control Mail, Ombudsman & Escalated Issues

33000 Outreach Campaigns

34000 Specialty Programs

35000 Specialty Tasks

36000 Training

40000 Change Management

46000 Records Retention

47000 Data Management & Integration

47000.000, 47001.000, 47002.002, 47003.000, 47006.000, 47008.000, 47009.000, 47010.000, 47011.000

48000 Reporting 48000.000

49000 Contact Center

50000 Other

Appendix A Attachment Crosswalk

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Instructions for these requirements

These requirements are referenced as Attachment #1 in the Statement of Work (SOW). If you are submitting a proposal for this solicitation, it is assumed the proposed solution will meet all of these requirements.

For any requirements not currently met, the offeror should clearly identify those requirements and provide a plan for meeting them within the implementation schedule in accordance with the solicitation instructions to offerors.

There are attachments referenced as part of the requirements. As with the statement above, submitting a proposal assumes the system meets all of the requirements at go-live.

The term "system" in this document refers to the offeror's total solution, if not specifically spelled out.

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Section 2000: Accessibility

• 2000.000: The Contractor shall provide a solution that gives the borrowers the option of requesting and receiving communications via alternative formats.

2000.010: The contractor shall create a process to in-take, track, and change alternative format requests for borrowers. The requests shall be received via phone, text, physical mail, email or via the contractor website. The borrower requests shall each be included/stored within the borrower’s servicing history record and available on the servicing system for customer service representatives to access.

2000.020: The contractor shall create a process to provide communications via alternative formats, including Braille, HTML, Large Print, Electronic (digital navigable formats supported by computers and digital talking-book players) and/or Audio when requested by the borrower.

2000.030: The contractor shall in-take requests for publications in alternative formats on an individual basis (can be different from the default format and a different format for each publication).

2000.040: The contractor shall halt other delivery types once a borrower has chosen to receive communications via alternative formats.

2000.050: If a third-party vendor is utilized to provide this capability, the contractor shall ensure all cybersecurity requirements are met by the vendor and submit the appropriate System Impact Assessment to obtain FSA approval when implemented.

• 2001.000: The contractor shall inform borrowers of the availability of the alternative formats and the process for borrowers to request alternative formats.

2001.010: The contractor shall post the alternative format availability language on the servicing website.

2001.020: The contractor shall include the alternative format availability language on the loan statements.

2001.040: The contractor shall post on website and include on loan statements the following text about availability of alternative formats:

Borrowers are entitled to receive any student loan related communication or document in an accessible, alternative format. Borrowers interested in receiving student aid forms, student loan statements, notices, written communications, and publications in alternative formats should contact us directly at <loan contractor phone number> or by email at <loan contractor email address>. <Name of contractor> offers various alternative formats such as Braille, large print, audio CD, and digital navigable formats supported by computers and digital talking-book players or delivered through data CD.

• 2004.000: The contractor shall create and provide the alternative formats to the borrowers.

2004.010: The contractor shall tag the borrower account with one default alternative format for all communications, specifically forms, loan statements, notices, publications, and other written communications.

2004.020: The contractor shall update the default alternate format for all communications when requested by the borrower.

2004.030: The contractor shall provide a means for FSA to monitor the quality of the alternative formats created and ensure the readability of the communications.

2004.040: The contractor shall store copies of the information provided to borrowers in standard formats as part of the borrower's servicing record.

2005.000: The contractor shall track any borrower feedback (i.e., complaints, inquiries on status of the alternative status) regarding the borrower's alternative format in the borrower account history.

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2005.010: The contractor shall track any alternative format issues in the borrower account history (e.g. braille unreadable or audio CD does not work).

2005.020: The contactors shall provide an on-line method for borrowers to report accessibility issues

• 2006.000: The contractor shall carry out escalated issues process with Federal Student Aid operations points of contact

2006.010: The contractor shall log any requests that do not follow the general request process and set-up of the requirements. The logging of this information must be submitted to the contractor or can be logged electronically in the system for reporting.

Examples:

‒ Borrower wants a specific set up for alternative format that does not follow the available options (authorized agents and borrower want both mail and braille to be sent).

‒ Borrower wants a specific alternative format not available.

‒ Co-borrower wants alternative format but not the borrower.

2006.020: The contractor shall submit to FSA escalated issues for any logged requests.

2006.030: The contractor shall work with FSA to resolve the issue.

2006.040: The contractor shall capture the resolution in the borrower’s account history.

• 2007.000: The contractor shall accept requests from borrowers to receive additional copies of communications via non-alternative formats.

2007.010: The contractor shall accept requests, via a representative or request through mail, for regular mail or email communications from borrowers with a current option to get all communications via an alternative format (for previously sent communication in an alternative format back one year).

2007.020: The contractor shall note in the borrower servicing history the date of each request and details of the request.

• 2008.000: The contractor shall create and provide operational reports detailing summary of alternative format requests, fulfillment, request fulfillment turnaround times, and borrower feedback.

See Attachment: 2008 Alternative Format Operational Report

2008.010: The contractor shall include the report(s) as part of the operational reports to be identified in the Operations Reports requirements and provided to FSA by the 10th business day of each month.

2008.020: The contractor shall track and include within report(s) a list of alternative format requests by type (with a description of the type) and a count of total borrowers receiving that format.

2008.021: The contractor shall include an annual report with annual totals as well.

2008.030: The contractor shall track and include within report(s) a count and description of all complaints and/or feedback in relation to alternative requests, the results of the request or the overall process.

2008.040: The contractor shall track and report on turnaround times for when requests have been fulfilled as well as volume of outstanding requests and date of oldest unfulfilled request.

• 2009.000: The contractor shall include alternative format request information in all account transfers.

2009.010: The contractor shall be prepared to provide the alternative format request indicator to the receiving contractor for any transferred loans.

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2009.020: The contractor shall transfer all alternative format information contained in the borrower history to the receiving contractor for the contractor’s record.

2009.030: The contractor shall request any alternative format information on borrowers received from the sending contractor.

• 2010.000: The contractor shall process inbound large print communications from the borrower.

• 2011.000: It is the responsibility of the contractor to provide specially trained customer service representatives (CSR) to assist with accessibility issues raised by the blind and/or other borrowers with disabilities or requesting alternative formats.

2011.010: The contractor shall train all CSRs on the basic availability of and process to request alternative formats. All contact center staff should also be trained on how and when to refer accessibility issues to the specially trained accessibility CSR(s).

2011.020: The contractor shall accept requests from blind and visually impaired borrowers via email, chat, website, text, postal mail, or telephone as well as accept/respond to TDD (Telecommunications Device for the Deaf) calls.

2011.030: The contractor shall provide blind and visually impaired borrowers the ability to contact a designated CSR or representative(s) via email, internet, or telephone.

2011.040: The contractor shall have the ability to read/interpret incoming Braille correspondence if received from borrowers.

• 2012.000: The contractor shall comply with Section 508 of the Rehabilitation Act of 1973, which requires that federal agencies’ electronic publications (forms, letters, etc.) and information technology (websites) is accessible to people with disabilities.

2012.010: The contractor shall ensure the website meets all Section 508 standards and

Web Content Accessibility Guidelines (WCAG 2.0) (Attachment 1) 2012.020: The contractor shall complete internal testing of the website prior to implementation of the initial website and prior to any future implementation of website modifications.

2012.030: The contractor shall ensure all testing efforts (internal, independent and FSA) include review of all electronic forms including, but not limited to student loan statements, notice, communications, and publications.

• 2013.000: The contractor shall provide independent testing of the website to ensure it meets Section 508 standards and WCAG 2.0.

2013.010: The contractor shall secure an independent testing service (approved by FSA) to execute testing of the website and provide certification that the independent agency confirms the site meets the proper standards.

2013.020: The contractor shall have the website tested by the independent service at least one time per calendar year and prior to any significant website changes.

2013.021: A significant change is defined as any changes that add new features and functions or new design patterns. Text changes, configuration changes or functional enhancements that fit within existing design patterns that had previously been tested would not need new independent testing.

2013.030: The contractor shall resolve high and medium priority problems/issues found by the independent testing service and have the website re-tested for compliance to ensure the website meets standards prior to any implementations.

2013.040: The contractor shall share all testing results from the independent service with FSA, including all details, issues, recommendations.

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2013.050: The contractor shall conduct its own pre-release accessibility testing for any new websites.

2013.060: The contractor shall conduct its own pre-release accessibility testing (see attachment 2013 Section 508 Compliance Test Process for Applications) for any substantial changes to its website(s). Substantial changes are defined as website changes that affect user interface interactive elements and or documents.

2013.070: The contractor shall produce a pre-release testing report for each pre-release accessibility test.

2013.080: The contractor shall produce pre-release testing reports according to the attached standard template (see Attachment 2013 Accessibility Testing Report).

2013.090: The contractor shall deliver each pre-release accessibility testing report to Federal Student Aid (FSA).

2013.100: The contractor shall fix any issues identified in the pre-release accessibility test.

2013.110: The contractor shall provide a pre-release accessibility test report to FSA without any ‘fail’ results prior to any new website implementation or substantial change implementation.

2013.120: The contractor shall provide a certification with each pre-release accessibility test report without any ‘fail’ results that certifies that the new website or substantial changes to existing website(s) is in compliance with Section 508/WCAG 2.0 standards

• 2014.000: The contractor shall request and support FSA testing of the website to ensure it meets Section 508 standards and WCAG 2.0.

2014.010: The contractor shall request to have the website tested on the Section

508/WCAG 2.0 accessibility standards every 6 months by the Department of Education, Assistive Technology Team (ED-AT) and every 3 months after each implementation of any substantial changes to its website(s). Substantial changes are defined as website changes that affect user interface interactive elements and or documents.

2014.020: If the ED Assistive Technology Office gets a complaint about a particular portion of a website that had previously passed 508 reviews and the AT team determines that the fix needs remediation. The contractor shall remediate the issue in the earliest possible release.

• 2015.000: The contractor shall monitor for any Section 508 or WCAG modifications.

2015.010: The contractor shall inform FSA of any changes to Section 508 or WCAG standards that may impact the website, forms, or practices.

2015.020: The contractor shall support FSA in identifying, analyzing and creating any change requests needed to support changes to Section 508 or WCAG standards.

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Section 3000: Website and Mobile Application

• 3000.000: The Contractor shall develop and host a Federal Servicing website that allows borrowers/students to access loan servicing accounts.

3000.010: The website shall adhere to Federal best practices for availability and accessibility

3000.020: The website shall at minimum be compatible (allowing all functionality) and tested with the leading browsers and operating systems, as defined in https://studentaid.gov/notices/site-requirements. This list will be reevaluated and updated by FSA annually.

3000.030: The website shall be available 24 hours a day, 365 days a year (366 in leap years) except during FSA-approved routine maintenance or during FSA approved outages.

3000.031: Requests for routine maintenance or approved outages shall be made to FSA no less than 30 calendar days prior to the outage date, except under emergency situations.

3000.040: The website shall be compliant with Sections 504 and 508 of the Rehabilitation Act of 1973 (29 U.S.C. sections 794 and 794d, as amended), including WCAG 2.0 Level AA Success Criteria, and WCAG 3.0 criteria (upon finalization of the standard).

3000.041: The contractor shall monitor the 508 standards for updates and compliance and have a remediation plan approved by FSA for any discovered accessibility issues.

3000.050: The website shall be optimized for mobile device experiences (mobile web) through responsive design. All website functionality and content shall be fully available in desktop viewports.

3000.051: Mobile applications are not allowed.3000.060: The contractor shall make all website content and functionality accessible to FSA, including authenticated borrower account information and functionality, through the use of dummy or test account logins or test environment access.

3000.070: The contractor shall make all digital communications accessible to FSA electronically, including all website accessible content, such as page copy, response form templates, secure inbox communication templates, chatbot intents (if applicable), annual report templates, and notifications. This access is informational, and prior approval for content by FSA is not required.

3000.071: The contractor shall provide FSA with electronic updates to all new or changed website accessible digital communications on a quarterly basis. Notice of changes and updates is informational, and prior approval for content additions or changes by FSA is not required.

• 3001.000: The website shall provide plain language information and communications to borrowers.

3001.010: All future content shall adhere to the standards of the Plain Writing Act of 2010 (the Act) (Public Law 111-274), as expressed in the Federal Plain Language Guidelines (see https://www.plainlanguage.gov/guidelines/), as well as the FSA Writing Style Guide (Attachment 3).

3001.020: The website shall display summary account level information to the user.

3001.021: Title IV loan data that is NOT owned by Government must be separated from loans that are owned by the Government but can be displayed together for presentation purposes for the borrower as long as they meet all cyber security requirements. However, full separation of loans not owned by the Government on the website is the preferred solution.

3001.030: The website shall display detailed loan level information to the user.

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3001.040: The website shall provide a link to allow users to submit a complaint directly to the FSA Ombudsman through https://studentaid.gov/feedback-center, accessible in the unauthenticated and authenticated header.

3001.050: The website shall provide borrowers with the ability to access accessible PDF versions of forms prior to authentication in both English and Spanish (as available). The PDF forms will be hosted in a forms center within StudentAid.gov rather than the contractor website.

3001.051: Links to specific forms hosted on StudentAid.gov shall also be available on each electronic application's or flow's landing page prior to beginning the electronic application/flow.

3001.060: The website shall provide links for relevant servicing functions, including those hosted on StudentAid.gov rather than on servicer sites, and including links to support documentation. Servicing functions hosted on StudentAid.gov currently include Loan Consolidation requests and Loan Simulator.

3001.061: The website shall provide links to support documentation for all servicing functions, including plain language help articles, guidance on contacting appropriate CSRs, and links to the StudentAid.gov flows within website navigation and dashboards.

• 3002.000: The Co-Branded website will have the following key features and functions.

3002.010: The website shall provide the ability to display announcements and/or banners using a standard component style as provided by FSA, to include a headline, body copy, and optional link.

3002.020: The contractor will update the website announcements and/or banners at FSA's direction (e.g., announcing new program or requirement) without additional cost to FSA, within 8 business hours from being provided the announcement.

3002.060: The contractor shall support the use of standardized header and footer styles, including servicer and FSA co-branding logo, on the website, including authenticated and unauthenticated global menu sections, and information on what it means to be an official servicer of FSA and how borrowers can avoid fraud. Specifications to be provided by FSA. See attachment 3002 Code Snippets and Brand Templates Attachments.zip

3002.061: The contractor shall support the use of standardized headers and footers in all borrower communications, including email, paper, CSR greetings, and chatbot intents (if applicable). These templated headers and footers will be provided by FSA and include servicer and FSA co-branding logos.

3002.062: The contractor shall support the use of FSA brand standards for illustrations, graphics, photography, and icons on the website, either through the use of FSA provided materials, or through the use of brand compliant illustrations, graphics, and icons and defined by the FSA Brand Style Guide.

DEFERRED FUTURE CLIN 7 REQUIREMENT - 3002.070: The contractor shall enable post-transactional surveys for a representative sample of users for all key customer tasks.

• 3002.080: The contractor shall implement the functionality for borrowers to electronically upload all the approved OMB forms used by servicers and all supporting documentation for servicing

• 3003.000: The information system, including all customer facing interfaces (i.e., web), shall provide a seamless Single Sign-on access experience across servicing functions hosted by either the contractor or FSA on StudentAid.gov.

3003.010: The website shall use FSA’s Person Authentication Service (PAS) with FSA ID exclusively for sign on, account creation, and account recovery flows.

3003.020: The contractor shall support the orderly transition from servicer account authentication to FSA ID sign on.

3003.021: During a transition period, the contractor shall provide borrowers with the ability to log on using the servicer's log in credentials/process and single sign

Version: 5 11 5/22/2024 on/FSA ID. Single sign on does not extend to servicer ID logins during this transition period.

3003.022: Borrowers logging in through their servicer credentials/process will see messaging and communications encouraging them to transition to using FSA ID.

3003.023: The contractor shall support the sequencing of contractor website authentication transition from offering both servicer credentials and PAS/FSA ID to exclusively PAS/FSA ID to balance the load on FSA support systems and contact centers. The sequencing and timing shall be determined by FSA.

3003.024: For borrower issues with PAS/FSA ID authentication, the contractor shall direct users to the BPO support channels. BPO will be responsible for supporting borrower access inquiry and password resets.

3003.025: The contractor shall support a borrower communication campaign prior to implementation of FSA ID on the authentication transition.

• 3003.025.1: These communications shall include custom communication to borrowers without active FSA IDs. Particular at-risk pools of borrowers will be provided by FSA, with emphasis placed on borrowers who have not used their FSA ID in more than a year.

3003.026: The contractor shall support the pre-population of account information and preferences for new FSA IDs in FSA's systems for of borrowers who do not have active FSA ID accounts.

3003.027: The contractor shall support conducting a limited pilot SSO prior to full rollout at the discretion of FSA.

3003.028: The vendor shall not use social security numbers to authenticate a borrowers account in accordance with OMB M-07-16.

3003.030: The contractor shall support the two-way updating of account information between contractor systems and FSA systems in near real-time.

3003.031: The contractor shall record the borrower's updates, including the date/time and option chosen. The history of all options and when chosen/changed shall be stored and be part of the two-way updating solution for account information.

3003.032: The website shall direct users to email and SMS verification through the PAS solution or at studentaid.gov.

3003.033: The contractor shall track borrower communication preferences, including contact via cell phone, text messaging, and any promotional/marketing emails.

3003.034: The contractor shall track all borrower consent to receive communications through email (eCorrespndence/eCorr) with a validity (True/False) indicator and a validity date.

3003.035: Account information shall include FSA ID enabled status, First Name, Middle Initial, Last Name, Date of Birth, email address, mobile phone number, alternate phone number, work phone number, permanent address, and communication preferences and authorizations (including the option to receive communication through email or through postal mail).

3003.040: The solution shall participate in the FSA single sign on solution ensuring that users can navigate between site participating in the SSO without being signed off if the user switches between websites.

3003.050: It is FSA’s vision and current direction for the contractor to use OpenID Connect (OIDC) for SSO.

• 3004.000: The servicing solution shall support the incremental migration of current and future functionality to the DCC mobile responsive web experience, with the future goal of all servicing front-end functions being provided exclusively through studentaid.gov.

3004.010: To support this transition, the contractor shall implement generic API specifications (provided by FSA in collaboration with the DCC team) that will be

Version: 5 12 5/22/2024 implemented by all contractors ensuring that DCC has a consistent API interface layer access with all contractors.

3004.020: The contractor shall collaborate with FSA to design and specify generic APIs that can be used by all contractors enabling FSA to implement a constant user experience in DCC.

3004.030: All APIs supporting DCC web applications shall be compliant with FSAs future Enterprise API Management standard.

• 3005.000: The contractor shall support through APIs the ability for borrowers to make online payments. The contractor shall enable the following capabilities:

3005.010: The website shall provide the ability to sign up for and end autopay.

3005.020: The website shall display the effective interest rate of each loan.

3005.030: The website shall allow a borrower to choose how to allocate their payments.

3005.040: The website shall allow a borrower to set standing instructions on how to allocate future payments.

3005.050: The website shall allow a borrower to schedule a payment date and shall also provide the borrower the option to advance or not advance the due date for each online payment.

3005.060: The website shall provide a payoff amount.

• 3006.000: The contractor shall accept eSigned and Digital signatures per Electronic Signatures in Global and National Commerce Act (E-Sign Act) as they apply to electronic transactions conducted by lenders, guaranty agencies, schools, and borrowers (program participants) under the student loan programs authorized by Title IV of the Higher Education Act of 1965 (HEA), as amended.

Note: Please refer to:

https://fsapartners.ed.gov/sites/default/files/attachments/dpcletters/gen0106Arevised.pdf

3006.010: The contractor should accept digitally signed documents, as long as the digital signature complies with prior E-SIGN guidance (where applicable).

3006.020: Certificate-Based Signatures: The only acceptable form of certificate-based signatures are those signed using a certificate issued by US Government, and the certificate must be marked as valid. In such a case, the contractor would need to either retain a copy of the original document containing the valid certificate or retain a copy of the “certificate properties” showing the validity of the signature and the signer’s information. The signer’s information should clearly show that the United States Government issued the certificate.

3006.030: Digital Facsimile Signatures: This is a digitally drawn signature using a Pen Pad, touch enabled device, or similar technology. This is fundamentally no different from a photocopy or fax of a “wet-signature.” As an example, a document or form signed using some product suites associated with DocuSign or Adobe Sign (formerly EchoSign), would be an example of a digital facsimile signature that is equivalent to an actual, physical signature. In these cases, contractor do not need to verify the signature any more than they would a wet signature. If the signature appears to be drawn by hand, no further verification is required, and it should be accepted.

3006.040: Digitization of Wet Signatures: A digitization of a pen and ink manually drawn signature begins with a signature with ink on paper, which is then digitized using a scanner or camera. Like digitally drawn signatures, these signatures are not fundamentally different from a photocopy or fax of a “wet signature”. In these cases, contractor do not need to verify the signature any more than they would a wet signature.

3006.050: A Typeset Signature (e.g., typing one’s name, initials, or other representation in place of a signature) is not an example of an acceptable digital signature.

https://fsapartners.ed.gov/sites/default/files/attachments/dpcletters/gen0106Arevised.pdf

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• 3008.000: The contractor shall direct borrowers to the unfilled PDF forms available on StudentAid.gov o

• 3011.000: The contractor shall properly denote trademarks like FAFSA®.

o 3011.010: The contractor shall use FAFSA® on all customer facing instances (websites user documentation, etc.).

o 3011.020: The contractor shall use GI Bill® on all customer facing instances (websites user documentation, etc.).

• 3013.000: The contractor shall inventory and report links to FSA websites.

o 3013.010: The contractor shall inventory any links to FSA (ed.gov) URLs that are currently being used throughout its products (including app(s), website(s), electronic/paper correspondences, and electronic/paper forms).

o 3013.020: The contractor shall report the inventory to FSA on periodic basis.

o 3013.030: The contractor shall ensure that new URLs and vanity URLs are reflected and implemented throughout its products (including app(s), website(s), electronic/paper correspondences, and electronic/paper forms).

o 3013.040: The contractor shall identify existing FSA (ed.gov) URLs that were not included in the initial redirect plan and list of DCC/vanity URLs, so that FSA can provide guidance.

o 3013.050: The contractor shall work with FSA to develop and provide a sequencing plan for updating impacted its URLs/links.

• 3014.000: The contractor shall create an HTML, or other universally accessible, non-proprietary format version of all student loan electronic statements.

o 3014.010: The contractor shall render the HTML, or other universally accessible, non-proprietary format version of all student loan electronic statements shall be read only.

o 3014.020: The contractor shall make the HTML, or other universally accessible, non-proprietary format version of all student loan electronic statements be for user (borrower) reference only.

o 3014.030: The contractor shall escalate to Federal Student Aid’s established borrowers’ resolution process any borrower notifications of a difference between the official versions of the loan statement (e.g. the portable document format (PDF) version).

o 3014.030: The contractor shall work with Federal Student Aid to research the issue, resolve the issue, or adjust the borrower’s account status when there are differences between the HTML, or other universally accessible, non-proprietary format version of all student loan statements and the official version. inventory and report links to FSA websites.

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Section 4000: Common Origination and Disbursement Interface

• 4000.000: The contractor shall implement the Common Servicing Interface with the

Common Origination and Disbursement (COD) system

• 4001.000: The contractor shall send and receive the Common Servicing Interface files using the Student Aid Internet Gateway (SAIG).

o 4001.010: Common Servicing interface files shall be submitted via the Electronic Data exchange over SAIG.

Links to SAIG Mailbox resources are located at:

https://fsapartners.ed.gov/knowledge-center/topics/software-and-other-tools (attachment) o 001.020: The contractor shall send and receive files daily; excluding Federal Holidays and outages.

***Changes due to scheduled COD System releases or other outages will be communicated during the COD/Servicer Weekly meetings.

o 4001.030: The contractor shall have a unique Test TG mailbox number to send and receive files from COD using SAIG.

o 4001.040: The contractor shall have a unique Production TG mailbox number to send and receive files from COD using SAIG.

https://fsapartners.ed.gov/knowledge-center/topics/software-and-other-tools

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• 4020.000: The contractor shall accept all transactions for loans that were transferred to

DMCS.

o 4020.010: The contractor shall put the transactions into suspense (WIP) and on a monthly basis, create a manual adjustment spreadsheet to forward the transfer update to DMCS. See requirements 29000 Adjustment Processing for more detail

• 4022.000: The contractor shall update a borrower's separation date or apply In-School deferments to borrower's accounts when new loans are booked to the servicing system.

o 4022.010: If the contractor has the borrower’s loan(s) in any other status than an in-school, in-grace, or in a school deferment, the contractor shall use new loan bookings as an indicator that the borrower is in school at least half time.

o 4022.020: The contractor shall extend the borrower's separation date if the borrower was continuously enrolled.

o 4022.030: The contractor shall apply In-School deferments to borrower's loans when new loans are booked to the servicing system. The begin date of the deferment shall be the award period begin date and the end date shall be the borrower's separation date sent by

COD.

o 4022.040: The contractor shall extend the borrower's separation date or apply the in-school deferment using the enrollment status of "half time".

o 4022.050: The contractor shall use the NSLDS enrollment reporting process from the school to validate accurate separation dates/deferment end dates. If the contractor does not receive confirmation within 120 business day from the receipt of the COD information, the contractor shall reach out to the school to validate the borrower actually enrolled in school.

• 4023.000: The contractor shall determine if updates are needed to the borrower's demographic information.

o 4023.010: The contractor has an option to process SSN, Name, DOB, Address, email, and phone numbers changes from COD. If the contractors believe their information is accurate, they do not need to process the change from COD.

Note: As per requirement 4012, the contractor needs to update and maintain the COD identifiers.

• 4024.000: The contractor shall report all transactions related to COD originations to FMS.

See Financial Activity and Transactions for more information on FMS reporting

• 4025.000: The contractor shall reconcile all financial activity on their servicing system and with FMS. See Financial Reconciliations and Reporting.

• 4026.000: The contractor shall participate in COD/Servicer/FSA status meetings. The meetings will review file processing and any open LDE Service desk tickets.

o 4026.010: The contractor shall send any issue/research request to the LDE Service

Desk, PII data shall not be sent in email as the contractor shall post documents to the SharePoint site.

• 4027.000: The contractor shall maintain a ticket tracking solution to track any system issues that they have regarding the interface. Examples include but are not limited to: The servicing system is rejecting items back to COD incorrectly, the servicing system is not updating accounts accurately based on data with the files

Version: 5 16 5/22/2024 o 4027.010: The contractor shall provide reports to FSA and review the errors during the COD/Servicer/FSA status meetings in requirement 4026.000.

• 4028.000: The contractor shall provide Contact names, emails, and phone numbers for the operational contacts for this interface.

o 4028.010: The contractor shall also need to provide production schedules as needed (if applicable).

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Section 5000: Repayment Plans

• 5000.000: The contractor shall provide and support repayment plan options for all loan types, including plans in existence prior to, and after, the Higher Education Reconciliation Act of 2005 (HERA).

o Standard – 10 years fixed o Extended – 20 years fixed

• 5001.000: The contractor shall allow a borrower to change repayment plans as applicable based upon regulations for the various loan programs.

o 5001.010: There is no limit to how often a borrower may change repayment plans.

o 5001.020: The new repayment plan monthly payment amount shall take effect with the current payment due date if the new amount is less than the current plan.

The new repayment plan monthly payment amount shall take effect with the next payment due date if the new payment amount is more than the current plan.

For Example: If Billy Borrower’s due date is the 14th today is June 7th, Billy’s “current Due Date would be June 14th, the amount if a "lower payment" it would be effective on June 14th, if a "higher" payment amount it would be effective as of July 14th.

o 5001.030: The contractor shall change the borrower repayment plan without changing the due date unless the borrower also requests a change in the due date.

o 5001.040: If the borrower's due date is advanced more than 30 calendar days, the contractor shall remove any prepaid status and make the borrower due for the new monthly payment amount within the next 30 calendar days.

o 5001.050: If the borrower’s due date is less than 21 calendar days in the future, and the new monthly payment amount is more than the current monthly payment amount, the new payment amount will be in effect for the following billing cycle.

For Example: If Billy Borrower’s due date is the 14th and on June 7th he requests to change his repayment plan, which results in a higher payment amount, the new higher payment amount will not take effect until the July 14th billing. The June 14th bill should remain at the current lower payment amount.

o 5001.060: If the borrower’s due date is less than 21 calendar days in the future, and the new monthly payment amount is the same or less than the current monthly payment amount, the new payment amount will be in effect this current billing cycle.

For Example: If Billy Borrower’s due date is the 14th and on June 7th he requests to change his repayment plan, which results in the same or a lower payment amount, the new payment amount will take effect with the June 14th billing.

• 5002.000: The contractor shall allow a borrower to change their due date. The day the payment is due shall be limited to the 1st to 28th of the month.

o 5002.010: The contractor shall secure the borrower’s permission before changing a due date and may not change the payment due dates arbitrarily.

• 5008.000: If the borrower is on a traditional repayment plan (non-IDR), the contractor shall amortize borrowers’ accounts no less than annually to ensure the borrower's scheduled payment amount will pay the loan off within the available term.

o 5008.010: The contractor shall review the amortization schedule of every borrower on a traditional repayment plan at least annually to validate that the account will pay off within the previously disclosed term.

o 5008.020: The contractor shall recalculate and re-disclose the borrower's repayment amount due for any account identified during the review that will not completely payoff within the disclosed terms and update the payment schedule.

Version: 5 18 5/22/2024 o 5008.030: The contractor shall re-disclose to the borrower any change to the borrower’s monthly payment amount at least 21 calendar days prior to the change taking effect.

• 5009.000: The contractor shall notify the borrower of repayment options while in grace.

o 5009.010: The contractor shall communicate the two repayment plan options 60 calendar days prior to grace end.

• 5010.000: The contractor shall assign borrowers not choosing a repayment plan to the

Standard repayment plan.

o 5010.010: The contractor shall assign borrowers to the Standard repayment plan until another plan is chosen by the borrower.

• 5011.000: The contractor shall notify the borrower when a repayment plan selection is received from the borrower. (This includes when the repayment plan is selected via web, mail, fax, text, chat, or phone) o 5011.010: The contractor must notify the borrower that the repayment plan selection was received. Notification by phone is acceptable provided the contractor keeps a record of the contact, time and date contacted along with subject matter provided.

o 5011.020: The contractor shall describe the review and approval process.

o 5011.030: The contractor shall describe the option and process for changing plans in the future.

• 5013.000: The contractor shall only provide standard or extended repayment options. (See Requirement 5000.000) o 5013.010: Standard Repayment plan has payments that are a fixed amount. These payments can be amortized up to 10 years.

o 5013.020: Extended Repayment plan has payments that may be amortized for up to 20 years if the borrower has a hardship or is a low-income borrower.

• 5032.000: The contractor shall allow the borrower to prepay the loan without penalty.

o 5032.010: The contractor shall apply the excess payment as a lump sum payment and shall apply normal payment application rules if the borrower's monthly payment amount equals or exceeds a monthly payment amount of $10.00 or more. (See 28000 series - Payments and Refunds - for additional information) o 5032.020: The contractor shall apply the excess payment as a lump sum payment, 5032.030: The contractor shall allow a borrower to direct the excess payment to a specific loan or group of loans.

• 5034.000: Contractors are required to update Poverty Guidelines annually to current guideline factors. (FSA will provide formal notice through the contract office when new Poverty Guidelines are available but will not issue a CR to cover contractor costs associated with this routine maintenance) o 5034.010: The contractor shall apply the poverty guidelines (for the relevant family size) for the 48 contiguous States if the borrower is not a resident of a State identified in the poverty guidelines.

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Section 6000: Financial Reporting and Reconciliation

• 6001.000: The contractor shall perform monthly reconciliations of balances and activity and provide the completed monthly reconciliations to FSA by their due dates.

See Attachment 06001_List of Deliverable Reconciliations to FSA for due dates for each deliverable listed.

o 6001.010: Timeliness for Reconciliations resubmitted to FSA will be determined by the resubmission date, not the original submission date.

• 6002.000: The contractor shall send all monthly reconciliations and required reports to FSA as instructed. All privacy information shall be properly secured when transmitting.

See attachment 06001 for different mailboxes for select deliverable reports and reconciliations.

NOTE: These addresses may be updated by FSA as needed.

o 6002.010: The contractor shall include in the email subject line: The contractor Source Code (e.g., S3), and the reconciliation name (e.g., Transfers to Other contractors to FMS Recon – 4453XNY) or report name (e.g., Transaction Tables (Crosswalk)).

o 6002.020: The contractor shall name each reconciliation file as follows: The contractor Source Code followed by reconciliation name, then fund, then amount type (if applicable), then the accounting period. Sample file name:

"S2_Transfers to Other Contractors to FMS Recon_Princ_4251XNY_Aug12"

• 6003.000: The contractor shall ensure all monthly reconciliations are reviewed by at least one level of the contractor’s management.

• 6004.000: The contractor shall ensure all monthly reconciliations include the signature of the preparer and reviewer and the date of signatures.

• 6005.000: The contractor shall ensure all signed monthly reconciliations and all necessary supporting documentation are provided to FSA in Adobe .pdf format.

o 6005.010: The contractor shall electronically sign the reconciliations using the Adobe e-signature function. The configure graphic must have an “Imported graphic” of the signee’s hand-written signature. The configure text must show Name, Date, & Labels. The text properties text direction must be Auto.

See Attachment 06005_Instructions for Electronic Signature

• 6006.000: The contractor shall also provide to FSA all spreadsheet type documents that are part of each reconciliation package, as separate Microsoft Excel documents.

• 6007.000: The contractor shall research and clear all reconciling items arising from monthly reconciliations within the month subsequent to the reconciled period. For example, reconciling items for the month of June shall be cleared within July.

• 6008.000: The contractor shall follow the formats provided by FSA to complete the monthly reconciliations. Number notations shall be included on the lead sheets of each reconciliation next to key data elements, and supporting documentation shall be provided with corresponding numbered pages to back-up the numbered data.

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• 6009.000: The contractor shall respond to FSA questions about their delivered reconciliations and make necessary modifications as directed within 2 business days.

o 6009.010: The contractor shall resubmit updated reconciliations with FSA requested modifications to the applicable mailboxes and indicate "resubmission" in the subject line along with: The contractor Source Code (e.g., S3), and the reconciliation name (e.g., Transfers to Other Contractors to FMS Recon – 4453XNY) or report name (e.g., Transaction Tables (Crosswalk)) and indicate in the subject line that the attachment is a resubmission.

o 6009.020: The contractor shall sign the resubmitted reconciliation with the revised date of completion for both the preparer and reviewer.

• 6010.000: The contractor shall demonstrate in the monthly reconciliations that all required data is transmitted to the Department and that all omissions, duplications of data, and recording errors are detected and corrected by the reconciliation's due date.

• 6011.000: The contractor shall include aging of reconciling items on all monthly reconciliations.

• 6012.000: Reconciliations shall be prepared and delivered by fund with each reconciliation reflecting all Loan Programs associated with each fund. The contractor shall ensure all Loan Programs are reported and reconciled as individual, distinct portfolios in the monthly reconciliations. See attachment for loan program codes and funds 1012 v5 o 6012.010: On all deliverable reconciliations, the contractor shall ensure that Teach Grants that have been converted to Direct Unsubsidized Teach Loans are reconciled separate from other Direct Loans. (Loan Program Codes for Direct Unsubsidized Teach Loans (TPL) and for Direct Loans (DLO).

o 6012.030: The contractor shall perform and deliver monthly reconciliations for all funds that have ever had any balances or activity. FSA can waive this requirement, in writing, once a fund has not had activity or an ending balance for a sufficient period of time and does not expect activity to occur going forward.

Should activity re-occur, the contractor is required to submit a reconciliation for that period and all subsequent periods until the criteria above are met for a waiver.

Note: "Activity" can include work in process (WIP), meaning that if the receiving contractor has accepted loans that have not yet been processed or loaded to borrower accounts on the servicing system, the contractor is defined as having activity in that fund even though no balances may yet exist. Therefore, the contractor must submit reconciliations for that fund showing adjusted balances resulting from the WIP.

• 6013.000: The contractor shall ensure monthly portfolio balances are supportable at the loan level.

• 6014.000: The contractor shall identify variances and exceptions at the FMS summary transaction code level, including FMS transaction ID number, within the monthly deliverable reconciliations to

FSA.

o 6014.010: The contractor shall identify all variances and exceptions for all reconciliations at the contractor's specific transaction code level including borrower/loan level information and FMS summary transaction codes and retain this detail level information to be provided to FSA within 2 business days upon request.

• 6015.000: The contractor shall provide an explanation for all transactions causing variances in all monthly reconciliations.

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• 6016.000: The contractor shall ensure that daily and monthly reconciliations and financial accounting include all applicable amount types (including principal, interest, fees and rebate amounts).

• 6017.000: [Technical Correction] The contractor shall use the appropriate FMS query tool to query the FMS database to obtain the FMS Trial Balance information by Source.

See Attachment 06017_FMS Operations - APEX User Support Handbook

• 6018.000: The contractor shall complete & deliver monthly portfolio reconciliations (Servicing System to FMS Reconciliation-by Fund & Loan Program) to reconcile the servicing system ending balance to the FMS ending balance for all applicable amount types (for example, principal, interest, fees, origination fee & rebate amounts*). The recon package shall include all lead sheets, reports, worksheets & info as shown in the attached sample (& any other documentation required to support the recon such as detail for reconciling items).

See Attachment 06018A1_Sample Servicing System Portfolio to FMS Reconciliation by Fund and Loan Program (principal)

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