Table of Contents

Introduction...........................................................................1
General Information .............................................................5
Cohort Default Rate Calculation.................................................5
Definition of Cohort Default Rates .....................................5
Cohort Default Rate Types .................................................5
Loans Included in the Cohort Default Rate ......................7
Release of Cohort Default Rates .......................................8
Time Frames of a Cohort Period.......................................11
Calculating the Cohort Default Rate .................................13
Loans Included in the Denominator..................................20
Loans Included in the Numerator......................................21
Special Circumstances .......................................................24
Affect of Adding/Subtracting Loans to/from Cohort
Default Rate Calculation..................................................33
Cohort Default Rate Effects........................................................35
Types of Cohort Default Rate Sanctions .........................36
Consequences of Cohort Default Rate Sanctions..........37
Consequences Associated with Unsuccessful
Cohort Default Rate Adjustment/Appeals......................43
Exceptions to Cohort Default Rate Sanctions.................43
Types of Cohort Default Rates Benefits ..........................45
Loan Record Detail Report .........................................................47
Definition of a Loan Record Detail Report.......................47
Reviewing a Loan Record Detail Report..........................49
Title Section of Loan Record Detail Report.....................52
Body Section of Loan Record Detail Report ...................54
Summary Section of Loan Record Detail Report ...........61
Sample Loan Record Detail Report..................................65

FY 1998 Official Cohort Default Rate Guide

Page i

Table of Contents

Electronic Loan Record Detail Report.....................................67
Definition of an Electronic Loan Record Detail
Report..................................................................................67
Format of an Electronic Loan Record Detail Report ......67
Procedures for Requesting an Electronic Loan
Record Detail Report ........................................................68
Repayment Information ...............................................................73
Definition of Repayment Information................................73
Format of Repayment Information....................................74
Benefits of Repayment Information ..................................75
Procedures for Requesting Summary Repayment
Information .........................................................................76
Procedures for Requesting Detailed File Format
Repayment Information ...................................................77

Information for Schools on Adjustments and
Appeals...............................................................................83
Uncorrected Data Adjustment ...................................................83
Part I: Background, Process, and Procedures .........83
Qualifying ..................................................................83
Definition of an Uncorrected Data Adjustment....83
Timing and Submitting ............................................89
Part II: Examples and Sample Material........................94
Example of a Situation that Warrants the
Submission of an Uncorrected Data
Adjustment..............................................................95
Sample Loan Record Detail Reports....................96
Sample Draft Data Challenge Response.............97
Uncorrected Data Adjustment Spreadsheet
Instructions .............................................................98
Sample Uncorrected Data Adjustment
Spreadsheet...........................................................99
Sample Uncorrected Data Adjustment Letter .....100

Page ii

FY 1998 Official Cohort Default Rate Guide

Table of Contents

New Data Adjustment...................................................................101
Part I: Background, Process, and Procedures .........101
Qualifying ..................................................................101
Definition of a New Data Adjustment....................101
Timing and Submitting ............................................116
Part II: Examples and Sample Material........................129
Example of a Situation that Warrants the
Submission of New Data Allegations .................130
Sample Loan Record Detail Reports....................131
New Data Allegations Spreadsheet
Instructions .............................................................132
Sample New Data Allegations Spreadsheet.......133
Sample New Data Allegations Letter....................134
Sample New Data Allegations Supporting
Documentation.......................................................135
Example of a Situation that Warrants the
Submission of a New Data Adjustment .............136
Sample New Data Allegations Response............137
New Data Adjustment Spreadsheet
Instructions .............................................................138
Sample New Data Adjustment Spreadsheet.......139
Sample New Data Adjustment Letter ...................140
Erroneous Data Appeal ...............................................................141
Part I: Background, Process, and Procedures .........141
Qualifying ..................................................................141
Definition of a New Data Adjustment....................141
Timing and Submitting ............................................159
Part II: Examples and Sample Material........................173
Example of a Situation that Warrants the
Submission of Erroneous Data Allegations.......174
Sample Loan Record Detail Reports....................175
Erroneous Data Allegations Spreadsheet
Instructions .............................................................176

FY 1998 Official Cohort Default Rate Guide

Page iii

Table of Contents

Sample Erroneous Data Allegations
Spreadsheet...........................................................177
Sample Erroneous Data Allegations Letter .........178
Sample Erroneous Data Allegations Supporting
Documentation.......................................................179
Example of a Situation that Warrants the
Submission of an Erroneous Data
Appeal.....................................................................180
Sample Erroneous Data Appeal Response ........181
Erroneous Data Appeal Spreadsheet
Instructions .............................................................182
Sample Erroneous Data Appeal Spreadsheet....183
Sample Erroneous Data Appeal Letter................184
Improper Loan Servicing and Collection Appeal..................185
Part I: Background, Process, and Procedures .........185
Qualifying ..................................................................185
Definition of a Improper Loan Servicing and
Collection Appeal .................................................185
Timing and Submitting ............................................200
Part II: Examples and Sample Material........................213
Example of a Situation that Warrants a
Request for Loan Servicing Records .................214
Sample Loan Record Detail Report......................215
Sample Request for Loan Servicing Records
Letter .......................................................................216
Example of a Situation that Warrants the
Submission of an Improper Loan Servicing
and Collection Appeal...........................................217
Improper Loan Servicing and Collection
Appeal Spreadsheet Instructions ........................218
Sample Improper Loan Servicing and
Collection Appeal Spreadsheet...........................219
Sample Improper Loan Servicing and
Collection Appeal Letter .......................................220

Page iv

FY 1998 Official Cohort Default Rate Guide

Table of Contents

Exceptional Mitigating Circumstances Appeals ...................221
General Information.............................................................221
Types of Exceptional Mitigating Circumstances
Appeals ...............................................................................221
Period of Time Associated with Exceptional
Mitigating Circumstances Appeals .................................226
Participation Rate Index Appeal................................................231
Part I: Background, Process, and Procedures .........231
Qualifying ..................................................................231
Definition of a Participation Rate Index................231
Timing and Submitting ............................................238
Part II: Examples and Sample Material........................245
Example of a Situation that Warrants the
Submission of a Participation Rate Index
Appeal.....................................................................247
Participation Rate Index Appeal Spreadsheet
Instructions .............................................................248
Sample Participation Rate Index Appeal
Spreadsheet...........................................................249
Sample Participation Rate Index Appeal Letter..250
Economically Disadvantaged and Placement
Rates Appeal................................................................................251
Part I: Background, Process, and Procedures .........252
Qualifying ..................................................................252
Definition of a Economically Disadvantaged
Rate .........................................................................252
Definition of a Placement Rate ..............................252
Timing and Submitting ............................................266
Part II: Supporting Material.............................................280
Sample Notice of Intent to File an Economically
Disadvantaged and Placement Rates Appeal
Letter .......................................................................281

FY 1998 Official Cohort Default Rate Guide

Page v

Table of Contents

Economically Disadvantaged Rate Spreadsheet
Instructions .............................................................282
Sample Economically Disadvantaged Rate
Spreadsheet...........................................................283
Placement Rate Spreadsheet Instructions ..........284
Sample Placement Rate Spreadsheet.................285
Sample Economically Disadvantaged and
Placement Rates Appeal Letter ..........................286
Sample Independent Auditor’s Attestation for
an Economically Disadvantaged and
Placement Rates Appeal Letter ..........................287
Economically Disadvantaged and Completion
Rates Appeal................................................................................289
Part I: Background, Process, and Procedures .........290
Qualifying ..................................................................290
Definition of a Economically Disadvantaged
Rate .........................................................................290
Definition of a Placement Rate ..............................290
Timing and Submitting ............................................304
Part II: Supporting Material.............................................320
Sample Notice of Intent to File an Economically
Disadvantaged and Completion Rates Appeal
Letter .......................................................................321
Economically Disadvantaged Rate Spreadsheet
Instructions .............................................................322
Sample Economically Disadvantaged Rate
Spreadsheet...........................................................323
Completion Rate Spreadsheet Instructions.........324
Sample Completion Rate Spreadsheet................325
Sample Economically Disadvantaged and
Completion Rates Appeal Letter.........................326
Sample Independent Auditor’s Attestation for
an Economically Disadvantaged and
Completion Rates Appeal Letter.........................327

Page vi

FY 1998 Official Cohort Default Rate Guide

Table of Contents

Withdrawing an Adjustment or Appeal ...................................329
General Information.............................................................329
Timing and Submitting ........................................................330
Sample Withdrawing an Appeal Letter.............................333

Information for Guaranty Agencies on Adjustments and
Appeals...............................................................................335
General Information for Guaranty Agencies on
Adjustments and Appeals .......................................................335
Information for Guaranty Agencies on Monthly Status
Reports ..........................................................................................339
Monthly Status Report Spreadsheet Instructions ...........342
Monthly Status Report Sample Spreadsheet..................343
Information for Guaranty Agencies on Uncorrected Data
Adjustments .................................................................................345
Information for Guaranty Agencies on New Data
Adjustments ................................................................................347
Part I: Background, Process, and Procedures .........347
Timing a nd Submitting ............................................347
Part II: Examples and Sample Material........................356
Example of a Situation that Would Result in a
Response to New Data Allegations ....................357
New Data Response Spreadsheet
Instructions .............................................................358
Sample New Data Response Spreadsheet.........359
Sample New Data Response Letter .....................360
Information for Guaranty Agencies on Erroneous
Data Appeals ...............................................................................361
Part I: Background, Process, and Procedures .........361
Timing and Submitting ............................................361

FY 1998 Official Cohort Default Rate Guide

Page vii

Table of Contents

Part II: Examples and Sample Material........................372
Example of a Situation that Would Result in a
Response to Erroneous Data Allegations .........373
Erroneous Data Response Spreadsheet
Instructions .............................................................374
Sample Erroneous Data Response
Spreadsheet...........................................................375
Sample Erroneous Data Response Letter...........376
Information for Guaranty Agencies on Improper Loan
Servicing and Collection Appeals ..........................................377
Part I: Background, Process, and Procedures .........378
Timing and Submitting ............................................378
Part II: Examples and Sample Material........................389
Example of a Request for Payment for Loan
Servicing Records .................................................391
Sample Request for Payment for Loan
Servicing Records Letter......................................392
Example of a Response to a Request for Loan
Servicing Records .................................................393
Sample Loan Servicing Records Response
Letter .......................................................................394
Information for Guaranty Agencies on Exceptional
Mitigating Circumstances Appeals ........................................395

Appendices
Appendix A - Guaranty Agency/Direct Loan servicer
Contacts ........................................................................................1
Numerical Listing .................................................................3
Alphabetic Listing ................................................................15
Appendix B – Extract File Layout for Electronic Loan
Record Detail Reports and Repayment Information .........1

Page viii

FY 1998 Official Cohort Default Rate Guide

Table of Contents

Appendix C – Message Classes for Electronic Loan
Record Detail Reports ...............................................................1
Appendix D - User Comments on the FY 1998 Official
Cohort Default Rate Guide........................................................1

FY 1998 Official Cohort Default Rate Guide

Page ix

Table of Contents

Page x

FY 1998 Official Cohort Default Rate Guide