Loan Verification Certificate for Special Direct Consolidation Loans

Forms and Documents

Document Name	Status
Federal Special Direct Consolidation Loan Verification Certificate Form and Instruction	New
SDCL LVC SLSA 12072011 comments_ED Response_12132011.pdf Supplementary Document	2011-12-19
SDCL LVC OMB Emerg Cl Memo_11212011.pdf Supplementary Document	2011-11-22
SDCL LVC SuppSt_Emerg Cl_REVISED FINAL_12142011.docx Supporting Statement A	2011-12-19

IC Document Collections

IC ID	Document Title	Status
200234	Federal Special Direct Consolidation Loan Verification Certificate Form and Instruction	New

ICR Details

OMB Control No: 1845-0111	ICR Reference No: 201111-1845-001
Status: Historical Active	Previous ICR Reference No:
Agency/Subagency: ED/FSA	Agency Tracking No: 4757
Title: Loan Verification Certificate for Special Direct Consolidation Loans
Type of Information Collection: New collection (Request for a new OMB Control Number)	Common Form ICR:  No
Type of Review Request: Emergency	Approval Requested By: 12/09/2011
OIRA Conclusion Action: Approved with change	Conclusion Date: 12/19/2011
	Date Received in OIRA: 11/22/2011
Terms of Clearance:

	Inventory as of this Action	Requested	Previously Approved
Expiration Date	06/30/2012	6 Months From Approved
Responses	62,633	0	0
Time Burden (Hours)	3,131,650	0	0
Cost Burden (Dollars)	0	0	0

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Abstract: This Loan Verification Certificate (LVC) will serve as the means by which the U.S. Department of Education (the Department) collects certain information from commercial holders of Federal Family Education Loan (FFEL) Program loans that a borrower wishes to consolidate into the William D. Ford Federal Direct Loan (Direct Loan) Program under a special initiative announced by the White House in an October 25, 2011 fact sheet titled, "Help Americans Manage Student Loan Debt." Loans made under this initiative are known as Special Direct Consolidation Loans. The information collected on the LVC includes the amount needed to pay off the loans that the borrower wants to consolidate and other information required by the Department to make and service a Special Direct Consolidation Loan. The purpose of the special consolidation initiative is to encourage borrowers who have both commercially-held FFEL Program loans and other loans that are held by the Department (either Direct Loan Program loans or FFEL Program loans previously sold to the Department by a FFEL Program lender) to consolidate their commercially-held FFEL Program loans into the Direct Loan Program. Currently, these borrowers have at least two loan servicers and are required to make at least two separate monthly payments on their federal education loans. This makes repayment more difficult and increases the likelihood of a borrower becoming delinquent or going into default. For a borrower who has both commercially-held FFEL Program loans and Department-held loans, consolidation of the commercially-held loans into the Direct Loan Program will simplify repayment by allowing the borrower to make a single monthly loan payment to one entity (a federal loan servicer under contract to the Department), thereby reducing the likelihood of delinquency or default. As an incentive for borrowers to consolidate under the special initiative, the Department is offering reduced interest rates on Special Direct Consolidation Loans.

Emergency Justfication: The U.S. Department of Education (the Department) requests emergency clearance of the Loan Verification Certificate (LVC) that will be used beginning in January 2012 in connection with making Direct Consolidation Loans through the William D. Ford Federal Direct Loan Program the special consolidation initiative announced by the White House in an October 25, 2011 fact sheet titled “Help Americans Manage Student Loan Debt.” Direct Consolidation Loans made under this initiative are referred to as “Special Direct Consolidation Loans.” The LVC collections information from the holders of the loans being consolidated that is needed by the Department to make and service Special Direct Consolidation Loans. Special Direct Consolidation Loans offer the incentives to split borrowers if they choose to consolidate their commercially-held Federal Family Education Loan (FFEL) Program loans into the Direct Loan Program and the Department is providing the incentives under the authority of section 455(b)(8)(A) of the Higher Education Act of 1965, as amended (the HEA). The Department is requesting emergency clearance of the Special direct Consolidation Loan LVC because the regular clearance process would prevent the Department from making Special Direct Consolidation Loans by the announced implementation date. Further, because the statutory authority under which the Department is providing the incentives will end on June 30, 2012, the use of normal clearance procedures would significantly shorten the already limited period during which Special Direct Consolidation Loans can be offered, with the result that fewer borrowers would be able to benefit from the reduced interest rates offered as part of the special initiative.

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Authorizing Statute(s): US Code: 20 USC 1087a Name of Law: Higher Education Act of 1965, as amended
  

Citations for New Statutory Requirements: None

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Associated Rulemaking Information
RIN:	Stage of Rulemaking:	Federal Register Citation:	Date:
	Not associated with rulemaking

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Federal Register Notices & Comments
60-day Notice:	Federal Register Citation:	Citation Date:
	76 FR 72917	11/28/2011
Did the Agency receive public comments on this ICR? Yes

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Number of Information Collection (IC) in this ICR: 1

IC Title	Form No.	Form Name
Federal Special Direct Consolidation Loan Verification Certificate	N/A	Federal Special Direct Consolidation Loan Verifiction certificate

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ICR Summary of Burden

	Total Approved	Previously Approved	Change Due to New Statute	Change Due to Agency Discretion	Change Due to Adjustment in Estimate	Change Due to Potential Violation of the PRA
Annual Number of Responses	62,633	0	0	62,633	0	0
Annual Time Burden (Hours)	3,131,650	0	0	3,131,650	0	0
Annual Cost Burden (Dollars)	0	0	0	0	0	0

Burden increases because of Program Change due to Agency Discretion: Yes

Burden Increase Due to: Changing Regulations

Burden decreases because of Program Change due to Agency Discretion: No

Burden Reduction Due to:

Short Statement: New collection of information which is necessary for the Department to collect certain information from commercial holders of FFEL Program loans that a borrower wishes to consolidate into the Direct Loan Program under a special initiative announced by the White House in an October 25, 2011 fact sheet titled, "Help Americans Manage Student Loan Debt."

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Annual Cost to Federal Government: $9,968,801

Does this IC contain surveys, censuses, or employ statistical methods? No

Is the Supporting Statement intended to be a Privacy Impact Assessment required by the E-Government Act of 2002? No

Is this ICR related to the Affordable Care Act [Pub. L. 111-148 & 111-152]? No

Is this ICR related to the Dodd-Frank Wall Street Reform and Consumer Protection Act, [Pub. L. 111-203]? No

Is this ICR related to the American Recovery and Reinvestment Act of 2009 (ARRA)? No

Is this ICR related to the Pandemic Response? Uncollected

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Common Form ICR:  No

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On behalf of this Federal agency, I certify that the collection of information encompassed by this request complies with 5 CFR 1320.9 and the related provisions of 5 CFR 1320.8(b)(3).

The following is a summary of the topics, regarding the proposed collection of information, that the certification covers:

(a) It is necessary for the proper performance of agency functions;

(b) It avoids unnecessary duplication;

(c) It reduces burden on small entities;

(d) It uses plain, coherent, and unambiguous language that is understandable to respondents;

(e) Its implementation will be consistent and compatible with current reporting and recordkeeping practices;

(f) It indicates the retention periods for recordkeeping requirements;

(g) It informs respondents of the information called for under 5 CFR 1320.8 (b)(3) about:

(i) Why the information is being collected;

(ii) Use of information;

(iii) Burden estimate;

(iv) Nature of response (voluntary, required for a benefit, or mandatory);

(v) Nature and extent of confidentiality; and

(vi) Need to display currently valid OMB control number;

(h) It was developed by an office that has planned and allocated resources for the efficient and effective management and use of the information to be collected.

(i) It uses effective and efficient statistical survey methodology (if applicable); and

(j) It makes appropriate use of information technology.

If you are unable to certify compliance with any of these provisions, identify the item by leaving the box unchecked and explain the reason in the Supporting Statement.

Certification Date: 11/22/2011

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