Release Notes: Item 1706-01

2017-18 Direct Loan Fees

This release upgrades FINANCIER to accommodate the change in loan fees for loans whose first disbursement occurs on or after October 1, 2017. The post-October 1 fee percentages are 1.066 for student subsidized and unsubsidized loans and 4.264 for PLUS loans. The new rates and effective dates are entered in WFLNFEEL. The conversion program WCDLFEEB will examine existing loans to ensure that the fee, rebate and net loan amounts exported to COD are correct for the actual disbursement date.

The conversion program will be needed only for loans that do not disburse prior to 10/1/2017. If you have not yet awarded DL funds with an anticipated first disbursement date AFTER 10/01/2017, you should not need to run the conversion program which we deliver in this release.

The conversion program WCDLFEEB excludes from processing any loan that has already been transmitted, based on the Sent date (WFLOAPPD.WF-LA-A-SNT-DATE not blank). That is, only loans that have not yet been reported to COD will be processed. As in prior years, you can set a parameter to bypass an undisbursed loan if the student has other loans of the same type that have been disbursed (that is, has disbursements in the award data for the same fund). Students with loans bypassed for any of these reasons are reported in Student Loans Bypassed (print file 3), by aid year, Student ID and loan type. Processed loans are reported in Student Loans Converted (print file 2), also in order by aid year, SID and loan type.

Via input parameters, you can set an effective date to be used by WCDLFEEB for the date comparison: specify the effective date in the date parameter, and set a flag to indicate that this date should be used as the comparison date. To accommodate the new rate regulation, you will set the effective date to October 1, so that disbursements with dates before October 1 will retain the old rates, and disbursements dated October 1 or later will be converted using the new rates. For example:

         2018,F,UG,TRIAL,10/1/2017,Y

The flag set to Y after the date instructs WCDLFEEB to use the parameter date 10/1/2017 as the pivotal date for the rate conversion. If the "use effective date" flag is not included, or is set to N, the current system date is used as the pivotal date.

However, if the conversion is run on or after October 1 -- that is, the system date of the run is the same as or later than the parameter date -- ALL loans that did not actually disburse before October 1 will be converted using the post-October 1 dates.

To set the requirement to check award data and bypass conversion of an undisbursed loan if the student has disbursed loans of the same type, set a flag at the end of the parameter string. For example:

         2018,F,UG,TRIAL,10/1/2017,Y,Y

Once the changes are put into place, COD reporting will be correct in all cases. However, a potential complication exists in the Disbursement Authorization process for students who have more than one loan of the same type. The Disbursement Authorization can’t always tell which loans’ dollars are being disbursed in any given run; all it can do is identify disbursements that are made for students who have two loans at two different rates. Most of these will not actually be problems –- anyone who had a fully-disbursed loan prior to October 1 and then gets a second loan afterwards will not be a problem; all of their post-October 1 disbursements should be at the new rate. For the potentially mixed-rate disbursements, the disbursement is done using the post-October 1 rate (which risks under-disbursing the student). If you get "mixed rate loan" warnings from the Disbursement Authorization program, you'll need to decide whether any of the disbursement authorization was done at the wrong rate, and to manually adjust the disbursement (net loan) amount and the payment (loan fee) amount to compensate.

Implementation Notes