The Department of Education has provided important reminders and resources for financial aid offices to ensure that their 22-23 Direct Loan data is submitted by the July 31st deadline. The guide includes best practices for reconciliation, details of how Direct Loan data impacts a school’s standing, and options for institutions to seek relief if they missing the last submission date.
POSTED DATE: February 12, 2024
AUTHOR: Federal Student Aid
ELECTRONIC ANNOUNCEMENT ID: DL-24-01
SUBJECT: Direct Loan Closeout Information for 2022–23 Program Year
The Direct Loan established data submission (closeout) deadline for the 2022–23 Program Year is Friday, July 31, 2024. This is the last processing day of the program year, so all school data must be received and accepted by this date to be included in a school’s final Ending Cash Balance for the year.
Note: Exceptions to the established data submission deadline may be made on a case-by-case basis if the school’s processing period extends beyond the deadline. Schools falling within this category should contact the FSA Partner and School Relations Center at the number provided below for further assistance. Once the closeout deadline has passed, a school may seek relief from the deadline via the Request Reopen/Extended Processing function on the COD website.
As a reminder, all cash management, disbursement reporting, and monthly reconciliation regulatory requirements supersede the closeout deadline. If a school is meeting these regulatory requirements, the final closeout stage should begin no later than the last award end date (also known as the loan period end date) at the school for a given program and year to reconcile to a zero Ending Cash Balance and close out soon after its final disbursements and should not wait until the closeout deadline.
To successfully close out, a school must—
Have an Ending Cash Balance of $0 and Total Net Unbooked Disbursements of $0 internally, and as reflected on the School Account Statement (SAS), and
Complete the School Balance Confirmation form on the COD website.
As part of the closeout process, the U.S. Department of Education (the Department) will send notices via Zero Balance or Remaining Balance emails. In addition, we will distribute a Notification Warning Letter via email to schools in early May 2024. This email will be sent to the Financial Aid Administrator and President at each school that has not confirmed closeout on the COD website (including any schools with a zero balance that have not confirmed closeout). It will serve as a reminder to finish processing and confirm closeout before the established data submission (closeout) deadline. After the closeout deadline, the school will be notified of its remaining balance through a Demand Letter or Negative Balance Letter. Any remaining positive balance will result in a final liability for the school.
A school must be aware of its closeout status even if its Direct Loan processing is handled by a third-party servicer. We encourage each school to communicate regularly with its third-party servicer to ensure closeout is completed. It is the school’s responsibility to ensure that it finishes processing and confirms closeout on time.
A key factor to an easy reconciliation and closeout is staying on top of the process. Schools should:
- Complete required monthly reconciliation, including:
- Internal reconciliation – compare internal student accounts and Business Office or Bursar records with Financial Aid Office records. If your school uses a third-party servicer, you should also ensure your internal and servicer records match
- External reconciliation – compare internal records to your Direct Loan School Account Statement sent via your SAIG mailbox
- Resolve any discrepancies and document outstanding timing issues
- Verify all drawdowns and refunds of cash are applied to the correct program and award year
- Ensure all batches have been sent to and accepted by the COD System and all responses have been imported
- Resolve all outstanding rejected records and ensure all disbursements and adjustments are accurately reflected
- Review all pending disbursements and determine whether these need to be reported as actuals (DRI = TRUE). If not, reduce these to $0.
- Return all refunds of cash electronically via G6 (g6.gov)
- Request any remaining funds if supported by actual disbursement data
Contact Information
We appreciate your cooperation as we work to close out the 2022–23 Direct Loan Program Year. If you have questions about this announcement or need assistance with closeout, contact the FSA Partner and School Relations Center at 1-800-848-0978. You may also email CODSupport@ed.gov.
SOURCE: (DL-24-01) Direct Loan Closeout Information for 2022–23 Program Year