1. 3CBG By the Bay 2009 Making the Switch: FFELP to Direct Lending Direct Loans and FFELP Loans

2. Introduction Carol Linsley, Financial Aid Functional Consultant SunGard Higher Education Carol.linsley@sungardhe.com

3. Agenda Information for clients switching to Direct Loans Overview Banner Set up Banner Day-to-Day Processing Question and Answer

4. Differences: Direct Loans vs. FFELP Single lender instead of multiple lenders, guarantors, servicers, or disbursing agents COD DL reporting similar to COD Grants reporting FAO controls loan processing not the guarantor Return of loan funds through COD reporting process, similar to grants Ineligible funds for one student may be used to pay another student instead of returning funds One MPN for the student, even if enrolled in different DL schools over the years Requires year end reconciliation

5. Advantages of Direct Loans Financial Aid Office controls the process Schools chooses when to disburse loans Require acknowledgement of PN? Of COD origination? No need to send hold and release request to guarantor No need to import EFT roster Minimal involvement for Bursar Office Response files from COD are received in a matter of hours

6. Becoming a Direct Loan Participant Allow six months for the conversion Submit the Electronic Application for Participation to be approved Send e-mail request to actively participate and receive final approval Complete or update SAIG mailbox enrollment Set School up to receive DL funds via GAPS

7. Becoming a Direct Loan Participant Contact COD school relations for assistance in: Updating DL contact information Sign up to receive DL Bulletins Select DL Report options Establish promissory note process Request Entrance Counseling files

8. Decisions to be Made Electronic MPN or Paper? Require acknowledgement of the MPN before disbursement? Require acknowledgement of origination record prior to disbursement? Annual or Once only Entrance Counseling files? Communication with Student about changes – Remember! New DL borrowers must complete a new MPN.

9. Overview To outline the set-up process and detail the procedures to set-up your Banner system To explain the day-to-day or operational procedures for direct loans

10. 3CBG By the Bay 2009 Part 1 – Setup

11. Direct Loan Setup RESOURCES TO REVIEW: SGHE Publication “COD Handbook” Loan Processing chapter, in the Banner Financial Aid User Guide Banner Help > Online Help on that specific form Annual Spring Banner Financial Aid Release contains updates for federal loan processing as well as COD processing

12. Direct Loan Setup OTHER HELPFUL RESOURCES: Direct Loan listserv National Direct Student Loan Coalition http://www.directstudentloancoalition.org/ Direct Loan Reference Material available at https://www.fsadownload.ed.gov/ Direct Loan Simulations and CBT’s http://www.nasfaa.org/publications/2008/e acodcbt102308.html

13. Direct Loan Setup AR Creates Detail Codes TSADETC – Detail Code Control Form FA Creates Fund Codes & Characteristics RFRBASE – Fund Base Data Form RFRMGMT – Fund Management Form Enter/View DL School Code RORCODI – COD Entity ID Rules ROAUSIO – US Specific Institutional Financial Aid Options

14. RFRMGMT (Funds Management Form) Notes for completing RFRMGMT for Direct Loan Funds - Enter Rebate Fee Percentage - Enter Loan Fee Percentage - Select Direct Loan Indicator

15. ROAUSIO (US Specific Institutional Options Form)- ROAINST Complete Loan Options - Loan Type of Both (or Direct) - Indicate Multi-Year Note Eligibility - Enter Entrance and Exit Requirements

16. Direct Loan Setup (cont.) Setting the Initial Loan Status RTVLNST – Loan Status Validation Form RPRLOPT – Loan Options Form Prom Note Disbursement dates RPRLPRD – Loan Period Base Data Form

17. RPRLOPT (Loan Options Form) School determines if PN and/or Disbursement is required before extracting origination School determines if Acknowledgement of Origination and/or Prom Note is required before disbursement

18. GJAPDFT for Loan Application Creation Define parameters for the Loan Origination Process RPRLORC This is the same process you use to set up parameters for Electronic Loans for RPRELAP Default parameters must exist for each user who has authority to create loan applications on-line This enables the user to create the origination record by clicking on ‘Create Loan Applications’ in the options menu on the award form (RPAAWRD).

19. Set-Up Forms specific to FFELP Processing RTVCINT – Certification Initials Validation Form - Establish certification initials for each staff that processes loans, if desired SPAIDEN – General Person Identification – create non person record for each lender, guarantor, and servicer RPRLNDR – Lender Base Data - Establish address information about a lender as well as to link the lender ID in SPAIDEN to the Guarantor or Insurer ID in SPAIDEN RPRLNDA – Lenders/Disbursing Agents Rules - Link a Lender ID with a Servicer ID to expedite transmission on hold/release records

20. 3CBG By the Bay 2009 Part 2 – Day to Day Operations

21. Day-to-Day Processes 1. Award & Originate Direct Loan 2. Submit Origination to COD 3. Execute MPN 4. Submit MPN to COD 5. Disburse Direct Loan & submit Disbursement to COD 6. Import Response from COD 7. Repeat for all Disbursements 8. Reconcile Direct Loan Funds

22. Booking a Loan A booked loan is the point at which an obligation has been established between the borrower and the Department of Education (DE) to repay a Direct Loan. There are 3 basic components that must be established before a loan is declared as booked by the DE If COD has received and accepted – a loan origination record –a completed and signed promissory note – a disbursement record

23. 3CBG South 2009 ORIGINATION LOAN ORIGINATION

24. Loan Origination Process Flow RPRLORC Create Loan Origination Create Origination Records REREXxx_yyyyy.xml REREXxx RPALORG REICODD Updated with batch information RPALORG REASTID REICODD RPALDSB RERIMxx Import origination Acknowledgement file into Banner REASTID Creates Student Identifier Record RPALORG Updates Origination Record Updated by RPRLORC process (Enter Parent Info on RPALORG for PLUS loans as needed ) FTP CRDLxxIN file to local PC. Send file to COD Receive acknowledgement file crdlxxop FTP to DATAHOME directory Updated by RERIMxx process RPAAWRD Award Loans to Eligible Students Start

25. Origination Activity RPAAWRD, RPAAPMT Loan funds are first awarded on one of the award forms Students may accept loans on Web or you may enter acceptances manually or in batch

26. Loan records are created either on-line or in batch process May create for Accepted or Offered Loans –Schools that choose to send Direct Loan Promissory Notes with the student’s award letter can create Origination records while the fund is still in an offered status. Batch process can be run globally or with a population selection Prom notes may be created immediately after loan records are created (if institution is printing PN’s) Origination Activity - RPRLORC Process

27. Origination Activities RPALORG - Federal Direct Loan Origination Form Major blocks of RPALORG Loan Information Summary block Promissory Note Summary block Loan Disbursement Summary block Disbursement Detail block Student Data block Parent Data block

28. This process extracts loan originations to be sent to COD for all records in a ‘R’eady or ‘N’ot Ready status on the RPALORG form. Can be run globally or with population selection to exclude selected students Can be run to extract all Direct Loan activity, changes only, or loans without changes Output CRDLxxIN Transfer File to PC to send to COD via EdConnect REREXxx Process updates the REICODD form Origination Activity - REREXxx Process

29. Origination Activities (cont.) REICODD - COD Document Control Form Document Control Form Information COD Document ID Extract Date Receipt Date Receipt Status Response Date Response Status

30. Origination Activities (cont.) REICODD – COD Document Control Form

31. Origination Activity - RERIMxx Process COD returns file as crdlxxop RERIMxx loads incoming file into Banner Forms updated with this process RPALORG REICODD

32. 3CBG By the Bay 2009 DIRECT LOAN PROMISSORY NOTES

33. Promissory Note Activities Creation of Direct Loan Origination Records RPRLORC - Loan Origination Process School Prom Note Status (Required) - indicates whether the student is expected to complete a paper or an E-MPN promissory note. If COD is going to use the Electronic Prom Note – choose Q If COD is going to print a Prom Note – choose R If school is going to print the Prom Note – Choose R and follow the Promissory Note Printing procedures.

34. DL Day-to-Day Process in Banner Q – E-MPN Student executes MPN online at DL website School receives and uploads response file crpnxxop – review resulting report to identify students who have signed an e- MPN, but do not have an RPALORG record in Banner

35. DL Day-to-Day Process in Banner R – Paper MPN REREXxx – Parameter 5: Promissory Note Print 0 = Schools prints from Banner R = COD prints, sends to school S = COD prints, sends to borrower

36. Promissory Note Activity Users must still allow the student the option of signing a paper promissory note even if choosing Q - E-MPN

37. Promissory Note Activity COD Import Process - RERIMxx MPN/PLUS Prom Note Acknowledgement (CRPNxxOP) file will be received, transferred and imported to Banner through the COD Import Process RERIMxx The following forms are updated: RPALORG - Direct Loan Origination RPAPROM – Promissory Note REICODD - COD Document Control RRAAREQ – Requirements Tracking (2 nd Page)

38. Disclosure Statement Printing RPRDSPT Process Schools usually request on the COD Extract Process REREXxx that COD print the Disclosure Statements but if necessary a school can print them using the Disclosure Statement Print Process RPRDSPT in Banner

39. 3CBG By the Bay 2009 DIRECT LOAN DISBURSEMENTS

40. DL Disbursement Flow Create Disbursement Records REREXxx_yyyyy.xml REREXxx REICODD Updated with batch information RPALORG REICODD RERIMxx Import disbursement Acknowledgement file into Banner RPALORG Updates Record FTP CRDLxxIN file to local PC. Send file to COD Receive acknowledgement FTP CRDLxxOP file to DATAHOME directory Updated by RERIMxx process RPEDISB Run Disbursement Process Updates Disbursement Record Start RPALORG ROIDISB Review Disbursement Results (Optional)

41. Disbursement Activity RPEDISB process is run to disburse loan funds, as with any other disbursement task The following forms are updated: RPALORG - Direct Loan Origination RPAAWRD – Award Maintenance ROARMAN – Financial Aid Record Maintenance RPAAPMT – Packaging Maintenance

42. Disbursement Activity COD Extract Process REREXxx This process is run to extract disbursement information for transmission to the COD Creates the Output: CRDLxxIN Transfer File to PC to send to COD via EdConnect Can be run to extract all Direct Loan activity, changes only, or loans without changes Edit (Anticipated) Disbursements – automatically extracted (Regulatory requirement) prior to actual disbursements Actual Disbursements – extracted once the scheduled disbursement date is reached and amount is in Paid Status

43. Disbursement Activity COD Import Process RERIMxx Files are returned from COD via EDConnect and imported into Banner: CRDLxxOP The following forms are updated: RPALORG - Direct Loan Origination REICODD - COD Document Control

44. 3CBG South 2009 Changes to Direct Loans

45. Making Changes to Direct Loans Change to Loan Amount before Origination is Sent Loan Decrease after Disbursement Loan Increase after Disbursement Note: You can increase a current origination or create a new origination for the difference Refer to the SunGard COD Handbook for more information on Direct Loan Changes

46. 3CBG By the Bay 2009 Direct Loan Entrance and Exit Counseling

47. DL Entrance / Exit Activity DECFENOP.dat DLFFEXOP.dat Receive Entrance & Exit files from COD Upload Entrance / Exit Activity RPRDUxx Student Entrance / Exit Record is updated RPILECS Create rules for Loading Entrance & Exit Data ROAUSIO RTVTREQ RFRMGMT Post Entrance / Exit Data Entrance – either as a tracking requirement via fund on RFRMGMT or batch posting Exit – either batch posting or by running RRREXIT RRAAREQ Posts Exit Requirement to RRAAREQ for students needing an exit interview RRREXIT Entrance / Exit Requirement Updated RRAAREQ Batch information Updated RPIBATC Transfer files from local PC to Banner server Note: these files will continue to be received in a fixed length format. Schools will continue to use the RPRDUxx process to upload these files into Banner.

48. Entrance/Exit Activity Entrance/Exit requirements are posted on RRAAREQ form Entrance and Exit codes as assigned to students on RRAAREQ Entrance can be posted via RFRMGMT when fund is awarded or Batch Posted Exit Records can be posted to a student’s file via RRREXIT or batch posted Students complete Entrance/Exit interviews on ED website Entrance counseling data is sent as DECFENOP file Exit counseling data is sent as DLFFEXOP file Note: Be sure to request these message classes (plain text) in order to load them into Banner.

49. RPILECS (Entrance Counseling Form)

50. 3CBG By the Bay 2009 DIRECT LOAN RECONCILLIATION

51. DIRECT LOAN RECONCILIATION What constitutes Reconciliation? Ending Cash Balance of -0- School’s cash drawdowns should equal booked disbursements, less cash returned If not equal, school should be able to identify and justify any differences This should be done regularly on a monthly basis to avoid issues at the end of the year.

52. School Account Statement Activity SAS – School Account Summary files are received via EDConnect and uploaded into Banner DSDFxxOP.DAT DSLFxxOP.DAT Banner supports only these message classes for SAS

53. Direct Loan Compare Reconciliation Process (RPRCPxx ) The Direct Loan Compare for the Reconciliation process can be used to extract required data used with the ‘Compare reports for the SAS files’ using the Direct Loan Tools for Windows software. –Files that are exported include: DLEXCASH — Provides data about the cash summary DLEXLOAN — Provides a summary of loan disbursements DLEXDISB — Provides data related to individual disbursement transactions –Note: The Direct Loan Tools for Windows software is available via the FSA download Web Site. Instructions for installing, using, and support of the software are available there. This software is not supported by Sungard Higher Education. www.sfadownload.ed.gov

54. Direct Loan Compare Reconciliation Process (RPRCPxx) Run Banner Direct Loan Compare Extract (RPRCPxx) using the end date of the 732 LOS reports as the Matching End Date parameter. This produces the Cash Summary shown above, and the DLEXLOAN.DAT, DLEXCASH.DAT and DLEXDISB.DAT files to be used per the instructions on using the LOC Compare Application. Refer to the Banner FA User Guide and COD Handbook for more information on this process.

55. DIRECT LOAN RECONCILIATION DL Reconciliation Tips Timing Issues – possible to not be in balance at any given time due to the timing of drawdown's, submission of disbursement records and adjustments Key is to identify reconciling records Closeout letter Compares GAPS Cash Balance to COD Booked Disbursements Received from the Department of Ed once year is complete Successful Closeout declared if equal

56. MPN Discharge, Expired MPN, and MPNs Due to Expire Report MPN Discharge Report - COD generates three fixed-length Direct Loan MPN reports. These reports are loaded via the Direct Loan Flat-File Upload process RPRDUxx and updates the Direct Loan Origination Form (RPALORG) MPN Discharge Report (MPNDISOP)— Notifies schools of MPNs that have become inactive within the last 30 days due to discharges for death and unauthorized signature Expired MPN Report (MPNINAOP) — Notifies schools of inactive MPNs within the last 30 days due to normal disbursement inactivity MPNs Due to Expire Report (MPNEXPOP) — Notifies schools of MPNs that are about to expire or become inactive within a specific number of days.

57. Other Direct Loan Training Opportunities Summit 2010 – Pre Summit Direct Loan Training is being planned, watch for this opportunity. Federal monies may be available for Direct Loan Training if bill is passed to eliminate FFELP programs. Your SunGard Financial Aid Consultants are ready to provide this training. Current Direct Lending classes are available via Webex, go to SunGard.com and click on Training.

58. School Resources https://www.fsawebenroll.ed.gov/PMEnroll/index.jsp To update SAIG mailbox enrollment https://www.g5.gov To set up school to receive funds via GAPS http://www.ed.gov/offices/OSFAP/DirectLoan/participati ng.html http://www.ed.gov/offices/OSFAP/DirectLoan/participati ng.html For full directions on becoming a DL participant http://www.ifap.ed.gov/eannouncements/1007CODUpd atedCBTDoc.html http://www.ifap.ed.gov/eannouncements/1007CODUpd atedCBTDoc.html for COD Computer Based Training

59. 3CBG By the Bay 2009 Questions and Answers

60. 3CBG By the Bay 2009 Thank You for Your Participation

61. 3CBG By the Bay 2009 SunGard, the SunGard logo,, the logo, and Banner, Campus Pipeline, Luminis, PowerCAMPUS, Matrix, Plus, and PocketRecruiter are trademarks or registered trademarks of SunGard Data Systems Inc. or its subsidiaries in the U.S. and other countries. All other trade names are trademarks or registered trademarks of their respective holders. © 2003-2008 SunGard