ECMC processing changes to accommodate PUT Program
The Ensuring Continued Access to Student Loans Act (ECASLA) of 2008 includes the Loan Purchase Commitment (PUT) Program, which means that lenders may sell fully disbursed Federal Family Education Loan (FFEL) Program loans to the U.S. Department of Education (Department) and transfer the servicing of those loans to one of the Department’s servicers.
Stafford (subsidized and unsubsidized), PLUS and Grad PLUS loans from the following time periods are eligible for the PUT Program:
2009-2010 academic year
- Loan period includes, or begins on or after, July 1, 2009
- First disbursement is on or after May 1, 2009, occurring no later than June 30, 2010
- Loan will be fully disbursed no later than September 30, 2010
2008-2009 academic year
- Loan period includes, or begins on or after, July 1, 2008
- First disbursement is on or after May 1, 2008, occurring no later than July 1, 2009
- Loan will be fully disbursed no later than September 30, 2009
For your reference, the Department maintains detailed information about the ECASLA Programs at http://federalstudentaid.ed.gov/ffelp.
Because ECASLA does not require lenders to provide advance notification of intent to PUT the loans, you may encounter a variety of scenarios:
- A pre-notification period allowing you to make limited changes to a loan
- After-the-fact discovery that a loan has been PUT
- Disbursement returns
The following information outlines important processing changes regarding ECMC-guaranteed loans that are PUT by the lender.
Whom should I contact with questions about the PUT Program?
- Kathy Sizemore at 651-325-4073 or ksizemore@ecmc.org
- Donna Quigley at 651-325-3314 or dquigley@ecmc.org
Scenario 1: Optional pre-notification of a PUT
Lenders and servicers may notify ECMC before a loan is PUT via the ECASLA PUT File. Note: Advance notification is optional and may not be utilized by all lenders and servicers.
If ECMC has been notified that a loan will be PUT, information will be provided to schools through the following methods.
ECMC Direct
The ECMC Direct Loan Detail screen will reflect PUT Adjustment Cutoff Date and Anticipated PUT Date in new fields when lenders and servicers choose to notify ECMC before a loan is PUT.
When a PUT Adjustment Cutoff Date is in the future, some changes are still permitted and others will not be allowed.
Changes still permitted:
- Disbursement cancels
- Refunds
- Post-disbursement partial cancels
Changes no longer allowed:
- Loan increases
- Reinstatements
- Reissues
- Reallocations
- Late disbursement processing
- Post-withdrawal disbursements
CommonLine Response File
If lenders and servicers participate in the optional pre-PUT notification process, the CommonLine Response file and ECMC’s Online Reports will contain information on the PUT loans. The CommonLine Response file will reflect the following information in three new fields:
- Servicer Code: Follow this link to the Department of Education's Servicer Codes >
- Adjustment Cutoff Date will be 9 business days before the Anticipated PUT Date
- Anticipated PUT Date will identify the date of loan transfer to the Department’s servicer
In order to provide our school customers with appropriate information when loans are transferred via the PUT process, ECMC will report the change as a “Modification (M)” record in the CommonLine Response file. For detailed information on changes to the specifications, please visit the NCHELP website at www.nchelp.org.
Online Application Response Report
PUT information will be included on the Application Response Report for schools that utilize ECMC’s Online Reports feature.
This information will include:
- Borrower SSN (and Student SSN if applicable)
- Borrower Name
- Loan Number
- Unique ID
- Loan Type
- Loan Period
- Current Loan Amount
- Adjustment Cutoff Date
Totals will also be provided for each loan type.
Scenario 2: After a loan has been PUT (with or without pre-notification)
The Department’s servicer will notify ECMC after a lender PUTs a loan that had been guaranteed by ECMC. ECMC can no longer make any changes once notified a loan has been PUT.
If you currently access the ECMC Direct Loan Summary and Loan Detail screens, the following information will be provided for PUT loans:
- Loan Status: "AE"
- Department of Education's Lender Codes: "895577", "897577", "898577" or "899577"
- Servicer Code: Follow this link to the Department of Education's Servicer Codes >
- The Loan Summary screen will display PUT loans in the Inactive Loans section
- The Loan Detail screen will display the date the loan was PUT in a new field called Anticipated PUT Date
Scenario 3: Disbursement returns
If a school uses ECMC Disbursement Services and returns funds to ECMC on a PUT loan, ECMC will return the funds to the school with instructions to forward the funds as outlined in the Federal Student Aid Handbook.
Follow this link to FSA's instructions >
Note: Lenders and servicers may have another process in place to handle returned funds on PUT loans not originally disbursed by ECMC.
Online PUT Cancel Report
The PUT Cancel Report identifies PUT loans with disbursements that were not disbursed before the PUT occurred. These disbursements are cancelled and ECMC cannot disburse the funds. If a borrower is eligible for additional funds, schools must certify a new loan as disbursements cannot be made on PUT loans. Schools can access this report using ECMC’s Online Reports feature. ECMC will mail paper reports to NDN schools.
