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pdfGuaranty Agency Financial Report
(GAFR)
ED Form 2000
Instruction Guide
Revised: June 2011
Federal Student Aid
Guaranty Agency Financial
Reporting Instruction Guide
Office of Federal Student Aid
Union Center Plaza, 830 First Street, N.E.
Phone 202.377.3332 • Fax 202.275.3481
E-mail: mailto:[email protected]
Guaranty Agency Financial Report (GAFR) Guide
Table of Contents
Page
CERTIFICATION ..................................................................................................................10
DEFINITIONS ........................................................................................................................11
GUARANTY AGENCY FINANCIAL REPORT MONTHLY ..................................................12
Reinsurance, Trigger Figure and Collections .......................................................................13
Financial Processing ................................................................................................................16
For Fiscal Month Of Reporting .............................................................................................18
MR – 1 Claims Paid................................................................................................................18
MR 1 Claims Paid - Amount Due To/(From) Guarantor .....................................................20
MR-1-A Defaults - Principal Amount .................................................................................21
MR-1-A Defaults - Other Amounts .....................................................................................21
MR-1-B Exempt/Lender-of-last-resort- Principal Amount .................................................22
MR-1-C Death/Disability - Principal Amount .....................................................................23
MR-1-D Closed School/False Certification - Principal Amount .........................................23
MR-1-E Bankruptcy - Principal Amount .............................................................................24
MR-1-F Unpaid Refunds - Principal Amount ...................................................................25
MR-1-G Discharges .............................................................................................................25
MR-2 Borrower Payment Return (Closed School/False Certification) ..................................27
MR-2 Borrower Payment Return – Amount Due To/(FROM) Guarantor ..........................27
MR-2 Borrower Payment Return - Principal Amount .........................................................27
MR-2 Borrower Payment Return - Accrued Interest ...........................................................27
MR-2 Borrower Payment Return - Other Charges ..............................................................27
MR-3 Status Changes .............................................................................................................28
MR-3 Status Changes - Amount Due To/ (From) Guarantor ..............................................28
MR-3-A Death/Disability - Principal and Interest ...............................................................29
MR-3-B Closed School/False Certification - Principal and Interest ...................................29
MR-3-C Bankruptcy - Principal and Interest .......................................................................29
MR-4 TOP Overpayments ......................................................................................................30
MR-4 TOP Overpayments - Amount Due To/(From) Guarantor ........................................30
MR-4 TOP Overpayments – Principal .................................................................................30
MR-4 TOP Overpayments – Interest Amount .....................................................................31
MR-4 TOP Overpayments – Other Amounts ......................................................................31
MR-5 Repurchases - Current Fiscal Year (CFY) ...................................................................31
MR-5 Repurchases - CFY - Amount Due To/(From) Guarantor ........................................33
MR-5 Repurchases - CFY - Principal Amount ....................................................................33
MR-5 Repurchases - CFY - Accrued Interest Due ED ........................................................34
MR-5 Repurchases - CFY – Other Amounts .......................................................................35
MR-5-A Repurchases - CFY - Defaults...............................................................................35
MR-5-B Repurchases - CFY - Exempt /Lender-Of-Last-Resort .......................................35
MR-5-C Repurchases - CFY – Death/Disability .................................................................36
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MR-5-D Repurchases - CFY - Closed School/False Certification ........................................36
MR-5-E Repurchases - CFY - Bankruptcy (Chapter 7, 11, 12 and 13) ...............................36
MR-6 Repurchases for Reinsurance Claims Paid in Prior Fiscal Year ..................................38
MR-6 Repurchases - PFY - Amount Due To/(From) Guarantor .........................................38
MR-7 Partial Refunds - Current Fiscal Year (CFY)...............................................................38
MR-7 Partial Refunds - CFY - Amount Due To/(From) Guarantor ....................................39
MR-7-A Partial Refunds - CFY - Defaults ..........................................................................39
MR-7-B Partial Refunds - CFY – Exempt/Lender-of-Last-Resort......................................40
MR-7-C Partial Refunds – CFY – Death and Disability .....................................................40
MR-7-D Partial Refunds - CFY - Closed School or False Certification .............................40
MR-7-E Partial Refunds - CFY - Bankruptcy .....................................................................40
MR-8 Partial Refund - Previous Fiscal Year (PFY) ...............................................................40
MR-8 Partial Refunds - PFY, Amount Due To/(From) Guarantor ......................................41
MR- 9 Overstated Claims .......................................................................................................41
MR-9 Overstated Claims - Amount Due To/(From) Guarantor ..........................................41
MR-9-A Overstated Claims - Defaults ................................................................................41
MR-9-B Overstated Claims - Exempt/Lender of Last Resort .............................................41
MR-9-C Overstated Claims - Death/Disability....................................................................41
MR-9-D Overstated Claims - Closed School/False Certification ........................................42
MR-9-E Overstated Claims - Bankruptcy............................................................................42
MR-10 Rehabilitated Loans....................................................................................................42
MR-10 Rehabilitated Loan Refund - Amount Due To/(From) Guarantor ..........................43
MR-10 Rehabilitated Loans - Principal Amount .................................................................43
MR-10-A Rehabilitated Loans- Principal Amount (GA Retention) ...................................43
MR-10-A Rehabilitated Loans - Interest ...........................................................................44
MR-10-A Rehabilitated Loans - Other Charges ..................................................................44
MR-11 FFEL Consolidation Refund ......................................................................................45
MR-11 FFEL Consolidation Refund - Amount Due To/(From) Guarantor ........................45
MR-11 FFEL Consolidation Refund - Principal Amount ...................................................45
MR-11 FFEL Consolidation Refund - Interest Amount ......................................................45
MR-11 FFEL Consolidation Refund – Other Amount ........................................................45
MR-11-A FFEL Consolidation Payoff – Principal Amount ................................................46
MR-11-A FFEL Consolidation Payoff – Interest Amount ..................................................46
MR-11-B FFEL Consolidation GA Retention – Principal Amount ....................................46
MR-11-B FFEL Consolidation GA Retention - Interest Amount .......................................46
MR-11-B FFEL Consolidation GA Retention - Other Amount ..........................................46
MR-12 GA Administrative Wage Garnishment .....................................................................47
MR-12 Administrative Wage Garnishment - Amount Due To/(From) Guarantor ..............48
MR-12 Administrative Wage Garnishment – Principal Amount ........................................50
MR-12 Administrative Wage Garnishment – Interest Amount ...........................................50
MR-12 Administrative Wage Garnishment – Other Amount ..............................................50
MR-12-A Administrative Wage Garnishment –Total Collected - Principal .......................50
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MR-12-A Administrative Wage Garnishment –Total Collected - Interest ......................... 51
MR-12-A Administrative Wage Garnishment –Total Collected - Other.............................51
MR-12-B Administrative Wage Garnishment – GA Retention – Principal ........................51
MR-12-B Administrative Wage Garnishment – GA Retention - Interest ...........................51
MR-12-B Administrative Wage Garnishment – GA Retention - Other ..............................51
MR-13 Default Collections ....................................................................................................51
MR-13 Default Collections - Amount Due To/(From) Guarantor.......................................52
MR-13 Default Collections – Principal Amount .................................................................54
MR-13 Default Collections – Interest Amount ....................................................................54
MR-13 Default Collections – Other Amount.......................................................................54
MR-13-A Default Collections –Total Collected - Principal ................................................54
MR-13-A Default Collections –Total Collected - Interest ..................................................54
MR-13-A Default Collections –Total Collected - Other .....................................................54
MR-13-B Default Collections – GA Retention - Principal ..................................................55
MR-13-B Default Collections – GA Retention - Interest ....................................................55
MR-13-B Default Collections – GA Retention - Other .......................................................55
MR-14 Bankruptcy Collections ..............................................................................................55
MR-14 Bankruptcy Collections - Amount Due To/(From) Guarantor ................................56
MR-14 Bankruptcy Collections – Principal Amount...........................................................56
MR-14 Bankruptcy Collections – Interest Amount .............................................................56
MR-14 Bankruptcy Collections – Other Amount ................................................................56
MR-15 Default FFEL Consolidated by DL Fee – Amount Due To/(From) Guarantor .........57
MR-16 Total ...........................................................................................................................57
NON-PAYMENT ACTIVITY (Accounting Data) ...............................................................58
Treasury Offset Program (TOP) ...........................................................................................58
Principal Amounts Column..................................................................................................59
Interest Amounts Column ....................................................................................................59
Other Amounts Column .......................................................................................................59
MR-17 Treasury Offset ........................................................................................................59
MR-18 Non-Federal Share Offset ........................................................................................59
MR-19 Treasury Offset Reversals .......................................................................................60
Status Changes - Account Balance at Conversion................................................................60
Account Balance at Conversion – Principal Amounts Column ...........................................61
Account Balance At Conversion - Interest Amounts Column .............................................61
Account Balance At Conversion - Other Amounts Column................................................61
MR-20 Default/LLR to Death and Disability ......................................................................61
MR-21 Default/LLR to Closed School/False Certification .................................................61
MR-22 Default/LLR to Bankruptcy.....................................................................................62
MR-23 Bankruptcy to Default/LLR.....................................................................................62
Agency Accruals (Accounting Entries) .................................................................................62
Principal Amounts Column..................................................................................................63
Interest Amounts Column ....................................................................................................63
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Other Amounts Column....................................................................................................... 63
MR-24 Collection Terminations ..........................................................................................64
MR-25 Compromises ...........................................................................................................64
MR-26 Agency’s Accruals ..................................................................................................64
GUARANTY AGENCY FINANCIAL REPORT MONTHLY/QUARTERLY .........................65
Agency Accruals (Information)..............................................................................................65
Principal Amounts Column..................................................................................................65
Interest Amounts Column ....................................................................................................66
Other Amounts Column .......................................................................................................66
MR-27 Default FFELP Loans Consolidated By Direct Loan Program ...............................66
MR-28 Subrogated Loans ....................................................................................................66
MR-29 Default Loans Transferred Out................................................................................66
MR-30 Default Loans Transferred In ..................................................................................66
MR-31 Other Transactions Affecting Federal Receivable ..................................................66
MR-32 Ending Balance of Defaulted Loans ........................................................................67
Delinquency by Debt ...............................................................................................................69
MR-33 Not Delinquent ........................................................................................................69
MR-34 (1 – 90 Days) ...........................................................................................................70
MR-40 Over 10 Years ..........................................................................................................70
Bankruptcy Reporting ............................................................................................................70
MR-41 Ending Balance on Bankruptcies ............................................................................70
MR-42 Bankruptcies Transferred Out .................................................................................70
GUARANTY AGENCY FINANCIAL REPORT ANNUAL .....................................................71
Loans in Repayment ...............................................................................................................72
AR- 1 Loans Guaranteed (Except Federal Consolidation) ..................................................72
AR- 2 All Loans Canceled (Except Federal Consolidation) ................................................72
AR- 3 Federal Consolidation Loans Guaranteed .................................................................73
AR- 4 Federal Consolidation All Loans Canc1eled .............................................................73
AR- 5 Uninsured Loans .......................................................................................................73
AR- 6 Loans Transferred In .................................................................................................73
AR- 7 Loans Transferred Out ..............................................................................................74
AR- 8 Default Claims Paid ..................................................................................................74
AR- 9 Bankruptcy Claims Paid............................................................................................75
AR-10 Death and Disability Claims Paid ............................................................................75
AR-11 Closed School/False Certification Claims Paid .......................................................76
AR-12 Loans Paid-In-Full ...................................................................................................76
AR-13 Federal Stafford and Unsubsidized Stafford Interim Loans ....................................77
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AR-14 Total Loans in Deferment Prior to First Payment ................................................... 77
Financial Report Introduction ...............................................................................................77
Federal Fund............................................................................................................................77
AR-15 Beginning Balance (from AR-26 as of 9/30/XX) ....................................................78
AR-16 Investment Income ...................................................................................................78
AR-17 Reinsurance from ED ...............................................................................................78
AR-18 Collections of Defaulted Loans – Reinsurance Complement ..................................78
AR-19 Insurance Premiums .................................................................................................79
AR-20 Other Revenues ........................................................................................................79
AR-21 Claims Expensed to Lenders ....................................................................................79
AR-22 Recall of Federal Funds to the Restricted Account..................................................80
AR-23 Transfer to Operating Fund for Default Aversion ...................................................80
AR-24 Transfer to Operating Fund for Account Maintenance Fee .....................................80
AR-25 Other Expenses ........................................................................................................80
AR-26 Ending Balance ........................................................................................................81
AR-27 Amount transferred from Federal Fund to Operating Fund for Operating Expenses
(Repayable) ..........................................................................................................................81
AR-28 Amount received from Operating Fund to Repay Advance for Operating Expenses
..............................................................................................................................................81
Operating Fund .......................................................................................................................81
AR-29 Beginning Balance (from 9/30/XX) .........................................................................81
AR-30 Default Aversion Fee Revenue ................................................................................81
AR-31 Loan Processing and Issuance Fee Revenue ............................................................82
AR-32 Account Maintenance Fee Revenue Received from ED ..........................................82
AR-33 Transfer from Federal Fund for Account Maintenance Fee ....................................82
AR-34 Collections of Defaulted Loans less Reinsurance Complement (GA Collection
Retention).............................................................................................................................82
AR-35 Investment Income ...................................................................................................82
AR-36 Other Revenue (FFEL and Non-FFEL) ...................................................................83
AR-37 Collections of Defaulted Loans (Secretary Equitable Share) ..................................83
AR-38 Operating Expenses..................................................................................................83
AR-39 Other Expenditures (FFEL and Non-FFEL) ............................................................83
AR-40 Ending Balance ........................................................................................................84
AR-41 Amount Received from Federal Fund for Operating Expenses (Repayable) .........84
AR-42 Amount Repaid to Federal Fund for Operating Expenses .......................................84
Restricted Account ..................................................................................................................84
AR-43 Beginning Balance (from 9/30/XX) .........................................................................84
AR-44 Recall of Federal Funds from Federal Fund ............................................................84
AR-45 Investment Income on Restricted Account ..............................................................84
AR-46 Investment Income on Restricted Account Expensed for Default Prevention.........84
AR-47 Ending Balance ........................................................................................................85
Balance Sheet Section (Federal Fund) ...................................................................................85
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AR-48 Cash, Cash Equivalents and Investments ................................................................ 85
AR-49 Restricted Account Cash, Cash Equivalents and Investments .................................85
AR-50 Net Investment in Property, Plant, Equipment and Inventory .................................85
AR-51 Accounts Receivable from the ED ...........................................................................85
AR-52 Other Assets .............................................................................................................85
AR-53 Accounts Payable, Accrued Expenses and Other Current Liabilities ......................86
AR-54 Accounts Payable to ED ..........................................................................................86
AR-55 Other Liabilities .......................................................................................................86
AR-56 Allowances and Other Non-Cash Charges to Federal Fund ....................................86
AR-57 Federal Fund Balance...............................................................................................86
ATTACHMENT A – Federal Fund Itemized Schedule .........................................................87
ATTACHMENT B – Operating Fund Itemized Schedule .....................................................88
ATTACHMENT C – Balance Sheet Section Itemized Schedule ...........................................89
ATTACHMENT D – Guaranty Agency List .........................................................................90
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INTRODUCTION
Guaranty agencies use the Guaranty Agency Financial Report to request payments from and make
payments to the Department of Education (ED) under the Federal Family Education Loan (FFEL)
Program, which is authorized by Title IV, Part B of the Higher Education Act of 1965, as amended
(HEA). ED also uses this information to monitor the agency‘s financial activities, including activities
concerning its federal fund and operating fund. Guaranty agencies perform certain activities in
connection with the following types of loans under the FFEL Program.
The Robert T. Stafford Student Loan Program (also known as Federal Stafford Loans or
Subsidized Stafford Loans),
Federal PLUS Loans,
Federal Supplemental Loans for Students (Federal SLS) ceased originating new loans
on July 1, 1994,
Federal Consolidation Loans, and
Unsubsidized Stafford Loans for Middle-Income Borrowers (Unsubsidized Stafford
Loans).
Note: Loans guaranteed under Non-FFEL Programs but administered by the guaranty agency are
not to be included in this report. An example of a non-FFEL program is a student loan program
established by State law and operated entirely with State funds for individuals pursuing a particular course
of study.
Guaranty agencies must maintain detailed records to support each entry on the Guaranty Agency
Financial Report and be able to reconstruct the entries back to individual loan, borrower or lender levels,
or to specific guaranty agency level transactions. This includes keeping accurate records of reinsurance
payments and collections on defaulted loans at the loan and borrower level. All records must be
available for verification by the Secretary of Education or other authorized representatives of the U.S.
Government.
Information on the Guaranty Agency Financial Report must be consistent with and comparable to
relevant information reported to the National Student Loan Data System (NSLDS) by the guaranty
agency.
Guaranty agencies are required to maintain all records in the manner and for the period of time set
forth in the Department‘s regulations. Detail records and reports are to be included in the compliance
audit requirements in accordance with 34 CFR 682.410(b) as required in the A-133 Audit Guide.
These instructions provide information on how to complete each item on the Guaranty Agency
Financial Report. However, they do not restate in their entirety the laws, regulations, and policy bulletins
which may apply to an item on the form. The following material should be consulted when completing
this report:
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The Higher Education Reconciliation Act of 2005
The Higher Education Act of 1965, as amended, and in particular, Title IV, Part B (20
U.S.C. 1071 et seq.)
The code of Federal Regulations, Department of Education, 34 CFR Part 682, Federal
Family Education Loan Program (formerly Guaranteed Student Loan and PLUS
Programs), and 34 CFR Part 668, Student Assistance General Provisions, and
Student Financial Assistance Programs bulletins. For a complete listing of FSA bulletins
go to: http
Note that the FFEL Program has frequent changes in laws, regulations, and policies. A
guaranty agency is responsible for complying with all current laws, regulations, and policies,
and for ensuring that any information provided on the Guaranty Agency Monthly/Annual
Financial Report conforms to them.
CERTIFICATION
Guaranty agency-related financial transactions are now being recorded electronically in the Federal
Student Aid (FSA) Financial Management System (FMS). By completing the U.S. Department of
Education Organization Participation Agreement (OPA) you are certifying that your Guaranty Agency
Financial Report (ED Form 2000) is a legally binding document that will cover two years. By signing and
returning this form, you will no longer need to mail paper ‗signature pages‘ after you submit your Form
2000 electronically. A copy of the OPA can be found on the Financial Partners Portal at
http://fp.ed.gov/fms.html.
Original signature documents should be mailed to:
Federal Student Aid
Finance Office
Financial Management Division
830 First Street, N.E.
Washington, DC 20202-5455
If you have any questions, please contact us at: [email protected]
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DEFINITIONS
Capitalized interest: The FFEL Program allows a lender to convert interest to principal under
certain conditions. This report will refer to this conversion and interest as ―interest capitalized by the
lender.‖ Once the lender capitalizes interest, it is not separately referenced. Instead, the capitalized
interest and the original loan amount together are referred to as principal.
Guaranty agency claim interest. Interest calculated by the guaranty agency on the loan principal
while a lender‘s insurance claim is being processed by the guaranty agency and which is eligible for
reinsurance from ED. It is paid to the lender by the guaranty agency as part of an insurance claim.
Non-reinsured guaranty agency (GA) interest: Interest that is not reinsured by ED. This
category includes interest that is calculated on the loan principal while a lender‘s insurance claim is being
processed by the guaranty agency. This interest must be paid to the lender by the guaranty agency but is
not eligible for reinsurance from ED. However, the Secretary of Education is entitled to an equitable
share of any of this interest collected from a borrower.
Purchased interest: Interest a guaranty agency pays to a lender at the time an insurance claim is
paid. It consists of lender interest, guaranty agency claim interest and non-reinsured GA interest, as
defined above. The guaranty agency must capitalize all purchased interest and treat it as part of the
principal balance.
Accrued interest. Interest calculated by the guaranty agency (not the lender) on the loan principal
on a collection account for collection from the borrower after an insurance claim is paid to a lender.
Principal: Once a claim has been paid to a lender the principal amount of the claim plus the
purchased interest paid to the lender is referred to as principal.
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Guaranty Agency Financial Report (GAFR) Guide
GUARANTY AGENCY
FINANCIAL REPORT
MONTHLY
1
Chapter
Guaranty agencies report to ED on a monthly basis to request payments for default,
bankruptcy, death, disability, closed school, false certification, and lender of last-resort-loan
(default) claims. This report is also used to report unpaid school refunds and teacher loan
forgiveness discharges. An agency also uses the form to make payments for amounts due ED for
collections on default and lender-of-last-resort loan (default) claims on which reinsurance was paid,
and for refunding amounts previously paid for reinsurance claims. Reference the Financial
Management System Guaranty Agency Guide posted at: http://www.fp.ed.gov/fms.html, for
completing the on-line forms.
Prior to July 1, 2006, guaranty agencies were required to file a claim for reimbursement within
45 days after the guaranty agency discharged its insurance obligation on the loan, however, effective
for July 1, 2006 the claim filing time has been reduced to 30 days. In order to provide a mechanism
for guaranty agencies to comply with the 30-day provision, ED has developed a Supplemental
Claims Invoicing process. The supplemental claims process will allow a guaranty agency to report
reinsurance claims on a bi-monthly basis. Procedures for supplemental claims processing are
posted at the link referenced above. The Supplemental Claims Invoice process has no impact on
regular monthly GAFR reporting, i.e., all monthly activity, including the Supplemental Claims
Invoice amounts should be included in the monthly GAFR submission.
The Monthly Report requires summary information only concerning guaranty agency‘s claims,
collections, and related activity over a monthly period. A guaranty agency can submit only one
monthly report for any month. Additional submissions for the same monthly period will be
rejected and the agency will be requested to submit the material in its next monthly submission.
After ED accepts an agency‘s monthly submission, no further corrections or adjustments can
be made. Errors have to be rectified by submitting the appropriate information in a later
submission.
When the monthly report is accepted, the guaranty agency can access their statement of account,
which will reflect the financial activity that has occurred during the month. Any net payment due an
agency in relation to this processing is electronically transferred to the agency‘s financial institution
approximately 30 days after ED receives an acceptable report.
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Unless otherwise specified, report only on activities on loans guaranteed under the FFEL Program
at the time the loan guarantee was issued and which are eligible for, or on which reinsurance was paid.
Loans guaranteed under other programs administered by the guaranty agency are not to be included in
this report.
Enter all dollar amounts greater than zero to the nearest cent, and include the decimal point.
Reinsurance, Trigger Figure and Collections
FFEL Program loans that a lender makes to a borrower are insured by a guaranty agency. When a
lender is unable to collect on a loan, it files an insurance claim with the guaranty agency. Guaranty
agencies pay lender insurance claims on defaulted loans and insurance claims submitted by exceptional
performers based on the following chart.
Description
Lender Insurance (Loan 1st
Disbursed Before 10/1/93)
Lender Insurance (Loan 1st
Disbursed On/After 10/1/93
and Before 10/1/98)
Lender Insurance (Loan 1st
Disbursed On/After 10/1/98
and Before 7/1/06)
Lender Insurance (Loan 1st
Disbursed On/After 7/1/06)
and Before 10/1/12)
Lender Insurance (Loan 1st
Disbursed on/After 10/1/12)
Lender Insurance for Exempt
Claims (Loan 1st Disbursed
Before 7/1/06)
Lender Insurance for Exempt
Claims (Loan 1st Disbursed
On/After 7/1/06)
Exceptional Performer (Claim
Submitted Before 7/1/06)
Exceptional Performer (Claim
Submitted On/After 7/1/06)
and Before 10/1/07
Exceptional Performer
Designation Eliminated,
effective 10/1/07
Loan Amount/
Claim Amount
$1,000.00
Reimbursement
Rate (GA to
Lender)
100%
Reimbursement
Amount to
Lender
$1,000.00
Reimbursement
Rate (ED to
GA)
100%
Reimbursement
Amount to GA
$1,000.00
$1,000.00
100%
$1,000.00
98%
$980.00
$1,000.00
98%
$980.00
95%
$931.00
$1,000.00
97%
$970.00
95%
$921.50
$1,000.00
95%
$950.00
95%
$902.50
$1,000.00
98%
$980.00
95%
$931.00
$1,000.00
100%
$1,000.00
100%
$1,000.00
$1,000.00
100%
$1,000.00
95%
$950.00
$1,000.00
99%
$990.00
95%
$940.50
N/A
N/A
N/A
N/A
N/A
Note: This chart does not take into consideration ―trigger figures rates,‖ i.e., when claims exceed 5% or
9% of loans in repayment.
ED reimburses the agency for part of its losses. This report is used to request these
reimbursements. ED reimburses guaranty agencies on the following types of claims:
Default
Exempt and lender-of-last-resort loan (defaults)
Bankruptcy (Chapters 7, 11, 12 and 13)
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Death or disability
Closed school or false certification
Unpaid refunds
Discharges (teacher loan forgiveness)
Definitions of each of these claim types are given in the instructions. In general, ED reimburses a
guaranty agency for 100 percent of its losses of all claim types above except default claims, which are
subject to reduced reimbursement rates. For purposes of reinsurance, a guaranty agency‘s losses consist
of loan principal, lender interest and guaranty agency claim interest. Non-reinsured GA interest is not
eligible for reinsurance, even though the guaranty agency must pay it to lenders.
Default claims on loan guarantees transferred to a guaranty agency under a plan approved by the
Secretary, regardless of the first disbursement date, are always reimbursed at 100, 90 or 80 percent.
Exempt claims are defined as claims with respect to loans for which it is determined that the
borrower (or the student on whose behalf a parent has borrowed), without the lender‘s or the
institution‘s knowledge at the time the loan was made, provided false or erroneous information or took
actions that caused the borrower or the student to be ineligible for all or a portion of the loan or for
interest benefits thereon. Exempt claims, on loans disbursed on or after July 1, 2006, are reimbursed for
100 percent of a guaranty agency‘s reinsured losses.
Lender-of-last-resort loans are loans made only to students who are otherwise unable to obtain
loans. A lender-of-last-resort loan (default) claim is one on which the borrower failed to make an
installment payment when due, as defined in the regulations. These claims are always reimbursed for 100
percent of their reinsured losses.
ED reimburses a guaranty agency (§682.404) for –
100, 90 or 80 percent of its losses on default claims when the loan was first disbursed before
October 1, 1993,
98, 88 or 78 percent of its losses on loans first disbursed on or after October 1, 1993 but
before October 1, 1998, and
95, 85 or 75 percent of its losses on loans first disbursed on or after October 1, 1998.
Default claims are subject to certain ―trigger figures‖ which results in a reduced reimbursement rate.
At the beginning of each federal fiscal year, ED calculates the trigger figure for each guaranty agency.
The trigger figures are equal to 5 percent and 9 percent of the guaranty agency‘s loans in repayment at
the end of the prior fiscal year.
When default claim losses exceed 5 percent of the loans in repayment it ―triggers‖ ED to reimburse
the agency for only—
90 percent of its default claim losses on loans first disbursed before October 1, 1993,
88 percent of its default claim losses on loans first disbursed on or after October 1, 1993 but
before October 1, 1998, and
85 percent of its default claim losses on loans first disbursed on or after October 1, 1998.
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When default claim losses exceed 9 percent of loans in repayment, it ―triggers‖ ED to reimburse
the agency for only—
80 percent of an agency‘s default claim losses on loans first disbursed before October 1,
1993,
78 percent of an agency‘s default claim losses on loans first disbursed on or after October 1,
1993 but before October 1, 1998, and
75 percent of an agency‘s default claim losses on loans first disbursed on or after October 1,
1998.
These reduced rates are generally referred to as ―reduced reimbursement rates.‖ The difference
between the default claim amount paid to the lender and the ―reduced reimbursement rate‖ is the
agency‘s ―reinsurance complement.‖
Once a default claim is paid to a lender, the guaranty agency becomes the holder of the loan and
must seek to collect on the loan from the borrower. Since ED reimburses a guaranty agency on defaults,
the guaranty agency must return to ED a portion of the amount it collects from the borrower. If ED
reimbursed the guaranty agency at 98, 95, 90, 88, 85, 80, 78, or 75 percent of the default claim paid to the
lender, then the agency‘s complement on collections from borrowers would be 2, 5, 10, 12, 15, 20, 22 or
25 percent.
The guaranty agency is also allowed to retain—
30 percent of the amount of collections received prior to October 1, 1993,
27 percent of the amount of collections received on or after October 1, 1993 and before
October 1, 1998,
24 percent of the amount of collections received on or after October 1, 1998 and before
October 1, 2003, and
23 percent of the amount of collections received on or after October 1, 2003 and before
October 1, 2007, and
16 percent of the amount of collections received on or after October 1, 2007.
The amount of the collections, which a guaranty agency must return to ED, is referred to as the
―Secretary‘s (of Education) equitable share‖ of collections. The formula for calculating the Federal share
of collections is [total collected less reinsurance complement less GA retention = Federal share of
collections].
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Financial Processing
When ED accepts an agency‘s monthly report, the system generates a statement of account that
provides financial information related to its monthly submission. This statement is a summary of all
monthly activity reported since the last statement was generated. Examples of information the statement
provides are: the amount of money ED owes the agency for reinsurance and other claims; the agency‘s
standing in relation to a reduction in its reimbursement percentage (the ―trigger figure‖); and the amount
of money the agency owes ED for collections on defaulted loans.
Reinsurance claim transactions are considered by ED to occur on the date a guaranty agency‘s
monthly report is paid by electronic funds transfer (EFT) by ED.
An agency‘s ―trigger figure‖ is adjusted for the fiscal year in which the approval date falls. This is not
necessarily the same fiscal year in which:
the guaranty agency paid the claim to the lender,
the guaranty agency reported the transactions to ED, or
the guaranty agency received the reinsurance payment from ED.
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Trigger figure calculation formula
Loans In Repayment2
5% Trigger = Loans In Repayment * 5%
9% Trigger = Loans in Repayment * 9%
Amount Requested Fiscal Year to Date (FYTD)3
Dollars Paid Fiscal Year to Date4
Rehabilitated Loans Applied - FYTD5
Rehabilitated Loans Unapplied – Carry Over CFY5
Rehabilitated Loans Applied – PFY6
Refunds Applied – FYTD7
Refunds Unapplied – Carry Over CFY8
Refunds Applied – PFY9
Trigger Basis Amount10
Percent of Request Paid11
Trigger Rate12
$683,877,349.00
$ 34,193,867.45
$ 61,548,961.41
$ 19,826,542.97
$ 19,346,754.82
$ 1,327,585.47
$
32,696.30
$ 17,986,473.05
97.58%
2.63%
Loans In Repayment [AR-1 (-) AR-2 (+) AR-3 (-) AR-4 (-) AR-5 (+) AR-6 (-) AR-7 (-) AR-8 (-) AR-9 (-)
AR-10 (-) AR-11 (-) AR-12 (-) AR-13 (-) AR-14]
2
3
Amount Requested Fiscal Year To Date = FYTD Total MR-1-A, ―Other Amounts.‖
4
Dollars Paid Fiscal Year To Date = FYTD Total MR-1-A, ―Principal Amount‖.
Rehabilitated Loans Applied FYTD = FYTD Total MR-10, ―Default Principal Amount‖, until GA hits 5%
trigger.
5
5Rehabilitated
Loan Unapplied – Carry Over CFY. After GA hits 5% trigger, rehabilitated loans will be
stored for credit to the next fiscal year.
6Rehabilitated
Loan Applied – PFY. This field will be populated when a GA hits the 5% trigger in the prior
fiscal year and they had an amount in ―Rehabilitated Loan Unapplied – Carry Over CFY.‖
7Refunds
Applied FYTD = FYTD Total MR-7-A, Partial Refunds, Defaults, Principal Amount + FYTD
MR-5-A, Repurchases CFY, Defaults, Principal Amount, if GA has a repurchase agreement.
8Refunds
Unapplied = Carry Over CFY. After GA hits 5% trigger, refunds will be stored for credit to the
next fiscal year.
9Refunds
Applied = Carry Over PFY. This field will be populated when a GA hit the 5% trigger in the prior
fiscal year and they had an amount in ―Refunds Unapplied – Carry Over CFY.‖
10Trigger
Basis Amount = Dollars Paid FYTD less Rehabilitated Loans Applied less Refunds Applied.
11Percent
of Request Paid = Dollars Paid FYTD/Amount Requested FYTD.
12Trigger
Rate = (Trigger Basis Amount/Loans in Repayment)*100.
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Collections, on defaulted loans, are considered submitted to ED on the date the monthly report is
received by ED. Amounts due the agency are sent to the agency‘s financial institution via electronic
funds transfer (through ACH) usually within 30 days after the date of receipt of an error-free report. ED
will process an agency‘s forms in the order they are accepted. This means that an agency‘s June form
could be processed before its May form if the June form had no errors, but the May form had to be
resubmitted several times. This could result in reinsurance claims from an earlier form being paid at a
lower reinsurance rate than some later claims. The guaranty agency‘s loan level records must reflect this
lower reinsurance rate.
ED will normally offset the amounts that a guaranty agency owes ED against amounts ED owes the
agency. In most cases, this will result in the agency receiving an electronic funds transfer for the
difference. In those cases where the agency still owes ED money after offset, then the agency‘s monthly
statement will reflect the balance due ED. If a guaranty agency elects to have the balance due ED
deducted from their next monthly submission, it is possible that the outstanding balance could be offset
by pending Account Maintenance Fees or Loan Processing and Issuance Fees payments that are
processed during the reporting period.
An agency must submit payments by sending ED an electronic funds transfer (EFT) via Fedwire.
For additional information or instructions, contact the Guaranty Agency Reporting Team via e-mail
at [email protected].
Please consult the Guaranty Agency User Guide for accessing the Financial Management System
(FMS) when completing the GAFR web application. The user guide can be found at this site:
http://www.fp.ed.gov/fms.html
For Fiscal Month Of Reporting
When entering the federal fiscal month and federal fiscal year of the month through which activity is
being reported always use numbers to stand for the federal fiscal month and year and enter the date as
MM/CCYY. An example of the fiscal month and federal fiscal year is as follows: October 2005 =
01/2006 and September 2006 = 12/2006
Line items MR-1 through MR-23 contain guaranty agency monthly activity and all activity from prior
periods being reported at this time. Line items MR-24 through MR-26 contain guaranty agency monthly
activity only.
MR – 1 Claims Paid
This section is used to request reimbursement for default and other FFEL program claims paid by
the guaranty agency to lenders for loan principal and interest. The categories of FFEL program claims
are: default, exempt (include claims where the student has been convicted of, or plead nolo contendere
or guilty to, a crime involving fraud in obtaining title IV student aid and claims where the borrower is a
victim of identity theft), lender-of-last-resort, bankruptcy, death, disability, closed school, false
certification, unpaid refunds and (teacher loan forgiveness) discharges.
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Include the original reimbursement request and any additional reimbursement requests. Additional
reimbursement requests are used in situations where either the lender or the guaranty agency did not
receive the full payment, to which they were legally entitled, when the claim was originally processed, by
the guaranty agency or ED. Also, use this section to request additional reinsurance reimbursement on a
default claim when the status changes to exempt and the guaranty agency is entitled to 100 percent
reimbursement...
If the agency receives a borrower payment from the lender after the date of the lender‘s claim
payment, reduce the reinsurance claim request amount (MR-1-A, Claims Paid) and the lender claim
amount (MR-1-A, Other Amounts) by the payment amount.
If the agency receives a borrower payment from the lender after the guaranty agency requests
reimbursement from ED, treat the payment as a refund and report the payment amount in MR-7, Partial
Refunds-CFY if the reinsurance is paid in the current fiscal year. If the reinsurance is paid in a prior
fiscal year, report the payment amount in MR-8, Partial Refunds-PFY.
If the agency receives a payment directly from the borrower, after the date of the lenders‘ claim
payment, treat the payment as a collection and report these amounts in MR-12, GA Administrative
Wage Garnishment, MR-13, Default Collections, or MR-14, Bankruptcy Collections, as appropriate.
If the guaranty agency paid a default or lender-of-last-resort loan (default) claim to a lender because
the borrower could not be located, then it can request reimbursement on the loan only if the agency
certifies that the lender has made a diligent attempt to locate the borrower through the use of reasonable
skip-tracing techniques, including contact with the school the borrower attended, in accordance with the
HEA and ED regulations. The guaranty agency must certify that skip-tracing attempts were made at the
time reimbursement is requested.
This amount reported in MR-1, Claims Paid does not include amounts paid to lenders for other
items such as late charges, collection costs, and attorney‘s fees. Also excluded is non-reinsured GA
interest.
The Secretary pays accrued interest on a bankruptcy claim if the guaranty agency was required to hold
the loan until it was discharged in bankruptcy. A bankruptcy claim paid to a lender prior to July 23, 1992
may meet this condition. A Chapter 7, 11 or 12 bankruptcy claim paid to the lender when the borrower
filed for discharge on the grounds of undue hardship, and the loan is subsequently discharged, also meets
this condition. For such a bankruptcy claim, the guaranty agency is entitled to receive interest, which
accrued (but was held in forbearance) on the discharged loan from the date the guaranty agency paid the
lender through the earlier of:
60 days after the date the loan was discharged, or
the date the agency‘s reinsurance claim is paid by ED.
The lender should repurchase bankruptcy claims paid to lenders prior to July 23, 1992, on which the
borrower has not filed for a hardship discharge, and the reinsurance amount has been returned to ED.
In the case where the agency submits its claim less than 60 days after the loan was discharged, the agency
will be unable to calculate the total amount of accrued interest due because it does not know the datethat
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ED will authorize the reinsurance claim to be paid. Therefore, the agency may calculate the amount of
interest that accrued through the date the agency files the reinsurance claim and report it in this item.
After the agency received payment from ED for the claim, the agency may calculate the additional
interest that has accrued from the date the agency submitted the claim through the earlier of the date ED
authorized payment of the claim or the 60th day after the loan was discharged. Unless an agency is,
otherwise, notified by ED, the date ED authorized payment of a claim is the date the agency received the
payment. The additional interest amount may be claimed in this item.
If the guaranty agency is holding a bankruptcy claim paid to a lender and the Bankruptcy Court
proceedings have been concluded without the loan being discharged, then the guaranty agency may not
file for reinsurance on the loan as a bankruptcy. Instead, the loan goes back into repayment, with any
interest that accrued during the bankruptcy proceedings being capitalized. The loan must either be
repurchased by a lender or collected on by the guaranty agency in accordance with program regulations.
If the loan later goes into default, the guaranty agency may file a default reinsurance claim with ED at
that time.
For a loan on which a bankruptcy claim is paid to a lender on or after July 23, 1992 and the guaranty
agency was not required to hold the claim, the guaranty agency can file for reinsurance at once. The
guaranty agency is not entitled to interest that accrues on such a bankruptcy claim between the time the
guaranty agency paid the lender and ED pays the agency.
MR 1 Claims Paid - Amount Due To/ (From) Guarantor
This amount is the total reimbursement the guaranty agency is requesting from ED (original and
additional requests) for all types of claims (i.e., default, exempt, lender-of-last-resort, death, disability,
closed school, false certification, bankruptcy, unpaid refunds and teacher loan forgiveness
discharges). This is a system-calculated field that does not allow guaranty agency input.
Example: The guaranty agency payment to the lender is $9,800, based on the lenders‘
requested amount of $10,000 on a default loan (not exempt or LLR) first disbursed on or after
10/1/98 and before 7/1/06 (i.e., 95% reinsurance reimbursement rate); a $2,000 death/disability
claim request from the lender; and a $100 borrower payment from the lender after the lender‘s
default claim was paid but prior to guaranty agency‘s request for reinsurance. The guaranty
agency‘s reporting would be as follows:
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ITEM
NO.
MR-1
CATEGORY
Claims Paid
MR-1-A
Defaults – Net
AMOUNT DUE
TO/(FROM)
GUARANTOR
$11,210.00
PRINCIPAL
AMOUNT
$9,210.00
M MR-1-B Ex Exempt/Lender-of-last-resort
OTHER
AMOUNTS
$9,800.00
$ 0.00
MR-1-C
Death/Disability
$2,000.00
MR-1-D
Closed School/False Certification
$ 0.00
MR-1-E
Bankruptcy
$ 0.00
MR-1-F
Unpaid Refunds
$ 0.00
MR-1-G
Discharges
$ 0.00
MR-1-A Defaults - Principal Amount
Enter amounts for default claims (original and additional requests) for this reporting period. A
default claim is one on which the borrower and endorser, if any, or joint borrowers on a PLUS or
Consolidation loan, failed to make an installment payment when due, or to meet other terms of the
promissory note, if the Secretary or guaranty agency finds it reasonable to conclude that the
borrower or endorser, if any, no longer intend to honor the obligation to repay—
for loans delinquent before 10/7/98, provided that this failure persists for (1) 180 days for a
loan payable in monthly installments; or (2) 240 days for a loan payable in less frequent
installments
for loans delinquent on/after 10/7/98, provided that this failure persists for (1) 270 days for
a loan payable in monthly installments; or (2) 330 days for a loan payable in less frequent
installments.
Also, include in this line item any request for reinsurance for loans that default after transfer
from an insolvent agency under a plan approved by the Secretary.
The total reimbursement request amount from ED is calculated by multiplying amounts paid to
lenders, for default claims, by the appropriate reinsurance reimbursement rate (based on date of the
loans first disbursement) and taking into consideration whether or not the agency has hit either their
5% or 9% trigger.
MR-1-A Defaults - Other Amounts
This line item is the total amount of original and additional payments made by the guaranty
agency to lenders for default claims. The amount should include principal and interest paid to
lenders, and guaranty agency claim interest, for default claims.
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Example:
The guaranty agency payment to the lender is $9,800, based on the lender requested amount of
$10,000 on a default (not exempt or LLR) loan first disbursed on or after 10/1/98 and before
7/1/06 (i.e., .95% reinsurance reimbursement rate). The guaranty agency‘s reporting would be as
follows:
ITEM
NO.
MR-1
CATEGORY
Claims Paid
MR-1-A
Defaults – Net
AMOUNT DUE
TO/(FROM)
GUARANTOR
$9,310.00
PRINCIPAL
AMOUNT
$9,310.00
OTHER
AMOUNTS
$9,800.00
Example of Exceptional Performer Reporting: The guaranty agency receives an insurance
claim on/after July 1, 2006, on a default (not exempt or LLR) from an exceptional performer
entity for $1,000.00. The guaranty agency payment to the lender is $990.00 (1,000 * 99%). The
guaranty agency‘s reinsurance claim to ED is $940.50 ($990 * 95%) (i.e., .95% reinsurance
reimbursement rate). The guaranty agency‘s reporting would be as follows:
ITEM
NO.
MR-1
CATEGORY
Claims Paid
MR-1-A
Defaults – Net
AMOUNT DUE
TO/(FROM)
GUARANTOR
$940.50
PRINCIPAL
AMOUNT
$940.50
OTHER
AMOUNTS
$990.00
MR-1-B Exempt/Lender-of-last-resort- Principal Amount
Enter amounts for exempt and lender-of-last-resort (default) claims (original and additional
requests) for this reporting period.
Exempt claims are filed in situations where the lender determines that the borrower or the
student on whose behalf a parent has borrowed, without the lender or school‘s knowledge at the
time the loan was made, provided false or erroneous information or took actions that caused the
student or borrower to be ineligible for all or a portion of a loan. Also include claims where the
student has been convicted of, or plead nolo contendere to, a crime involving fraud in obtaining title
IV student aid and cases where the borrower is a victim of identity theft. Exempt claims are exempt
from the agency‘s reinsurance trigger calculation, are insured at 100 percent and are reimbursed at
100 percent for loan disbursements made on/after July 1, 2006.
Lender-of-last-resort loans are loans made only to students who are otherwise unable to obtain
loans. A lender-of-last-resort (default) claim is one on which the borrower and endorser, if any,
failed to make an installment payment when due, or to meet other terms of the promissory note.
Lender -of-last-resort loans are always reimbursed at 100%.
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Example: The lender‘s request to the guarantor is $1,000 on an exempt claim that was first
disbursed on or after 7/1/06, and a lender-of-last-resort claim for $5,000. The amount reported
in MR-1-B would be $1,000plus $5,000. The guaranty agency‘s reporting on would be as follows:
ITEM
NO.
MR-1
Claims Paid
MR-1-A
Defaults – Net
CATEGORY
AMOUNT DUE
TO/(FROM)
GUARANTOR
PRINCIPAL
AMOUNT
INTEREST
AMOUNT
OTHER
AMOUNTS
6,000.00
0.00
MR-1-B Exempt/Lender-of-last-resort
6,000.00
MR-1-C
Death/Disability
$0.00
MR-1-D
Closed School/False Certification
$ 0.00
MR-1-E
Bankruptcy
$ 0.00
MR-1-F
Unpaid Refunds
$ 0.00
MR-1-G
Discharges
$ 0.00
MR-1-C Death/Disability - Principal Amount
Enter amounts for death and total disability claims (original and additional requests) for this
reporting period. A death claim is one on which the loan is discharged due to the borrower‘s death.
This includes a Federal PLUS loan for a death claim paid to a lender when a student, on whose
behalf a parent received the Federal PLUS loan, dies. A disability claim is one on which the loan is
conditionally discharged due to the total and permanent disability of the borrower.
If a death or disability claim is filed after a default claim was paid to the lender, and the
reinsurance claim was paid at less than 100 percent of principal and interest, then the complement of
the reinsurance may be requested using MR-3, Status Change. If a death or disability claim is filed
after a default or lender-of-last-resort loan (default) claim was paid at 100 percent, even though no
further reinsurance is due the agency, this change in status is reported in the Non-Payment Activity
section, MR-20, Default/Lender of Last Resort to Death or Disability.
MR-1-D Closed School/False Certification - Principal Amount
Enter amounts for closed school or false certification claims (original and additional requests) for
this reporting period. A closed school claim is one on which a claim is paid to a lender because the
student was unable to complete the program in which the student was enrolled due to the closure of
the institution. A false certification claim is one on which a claim is paid to a lender because the
student‘s eligibility to borrow under the FFEL Program was falsely certified by an eligible institution
of higher education.
If the borrower files a closed school and/or a false certification claim, after a default claim was
paid to the lender, and the reinsurance claim was paid at less than 100 percent of principal and
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interest, the complement of the reinsurance may be requested using line MR-3, Status Change. If the
borrower files a closed school or false certification claim after a default or lender-of-last-resort loan
(default) claim was paid to the lender and the reinsurance claim was paid at 100 percent, even though
no further reinsurance is due the agency, this change in status to closed school or false certification
must be reported in the Non-Payment Activity section, MR-21, Default/Lender of Last Resort to
Closed School/False Certification.
MR-1-E Bankruptcy - Principal Amount
Enter amounts for Chapter 7, 11, 12 and 13 claims (original and additional requests) for this
reporting period.
Chapter 7, and 11 bankruptcy claims are paid to a lender if:
the borrower has been in repayment status over 7 years from the date on which the
bankruptcy petition is filed for cases commencing before October 8, 1998, or
the borrower begins an action to receive a discharge on the grounds of undue hardship.
Chapter 12 and 13 bankruptcy claims are claims paid to a lender when a borrower files for relief
under those chapters of the U.S. Bankruptcy Code.
If the borrower files for bankruptcy after a default claim was paid to the lender, and the
reinsurance claim was paid for less than 100 percent of principal and interest, then the complement
of the reinsurance may be requested using line MR-3, Status Change. If the borrower files for
bankruptcy after a default or lender-of-last-resort loan (default) claim was paid to the lender and the
reinsurance claim was paid at 100 percent, even though no further reinsurance is due the agency, this
change in status to bankruptcy must be reported in the Non-Payment Activity section, MR-22,
Default/Lender of Last Resort to Bankruptcy.
During the course of the bankruptcy proceedings, the agency must report and return to ED, any
amounts received at the direction of the Bankruptcy Court in MR-14, Bankruptcy Collections. Once
bankruptcy proceedings are concluded and the loan is discharged, the agency must report and return
to ED any amounts received at the direction of the Bankruptcy Court in MR-14, Bankruptcy
Collections.
If the loan is not discharged, it must either be repurchased by a lender or collected on by the
guaranty agency in accordance with program regulations. The loan reverts to an ―in repayment‖
status at the lender. If the borrower does not repay the loan after the repurchase, then the loan
could go into default. The guaranty agency could pay a default claim on it and file a default
reinsurance claim using MR-1. This assumes all applicable lender and guaranty agency policies
concerning defaulted loans were followed.
In addition to arranging the lender‘s repurchase of the loan, the agency must refund to ED any
bankruptcy reinsurance payment it received and report it on MR-5, Repurchases - CFY (current
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Guaranty Agency Financial Report (GAFR) Guide
fiscal year) or MR-6, Repurchases - PFY (prior fiscal year). Also, report the account balance at
conversion (from bankruptcy to default) in MR-23, Bankruptcy to Default/Lender-of-last-resort, if
the loan was originally purchased as a default and collections resume due to dismissal of the
bankruptcy proceedings.
MR-1-F Unpaid Refunds - Principal Amount
Enter amounts for unpaid (school) refunds (original and additional requests) for this reporting
period. An unpaid refund, in the case of an open or closed school, is a discharge of a former or
current borrower‘s (and any endorser‘s) obligation to repay that portion of a FFEL loan (disbursed
on or after January 1, 1986) equal to the refund that should have been made by the school. Include
in this amount any accrued interest and other charges associated with the unpaid refund, which are
also discharged.
In accordance with the unpaid refund provisions, calculate the amount paid to lenders for these
refunds. Add to this figure the amount of the reinsurance complement requested by the agency on
loans it holds for which the borrower qualifies for an unpaid refund.
Also, see MR-31, Other Transactions Affecting Federal Receivable, to report the federal
receivable portion of unpaid refund discharges on guaranty agency held loans.
MR-1-G Discharges
This line item will be used to request reimbursement due to teacher loan forgiveness discharges
and partial discharges of consolidation loans.
Teacher loan forgiveness is a discharge of a borrower‘s obligation to repay up to $5,000 or up to
$17,500 of their outstanding student loan balances. Forgiveness is available to a borrower who has
no outstanding loan balance under the FFEL Program or the Direct Loan Program on October 1,
1998 or has no outstanding loan balance on the date he or she obtains a loan after October 1, 1998.
The Secretary pays the guaranty agency a percentage of the discharge that is equal to the complement
of the reinsurance percentage paid on the loan. The payment may also include interest that accrues
on the discharged amount during the period from the date the guaranty agency received payment
from the Secretary to the date on which the guaranty agency determines that the borrower is eligible
for the teacher loan forgiveness.
A partial discharge of a Consolidation loan occurs when a loan was obtained jointly by a married
couple if one of the borrowers dies or becomes totally and permanently disabled. The amount of
the Consolidation loan that is discharged is equal to the portion of the outstanding balance of the
Consolidation loan, as of the date the borrower died or became totally and permanently disabled,
attributable to any of that borrower's loans that would have been eligible for discharge.
In accordance with the teacher loan forgiveness provisions and the partial discharge of
Consolidation loans provisions, calculate the amount paid to lenders for discharges. Add to this
figure the amount of the reinsurance complement requested by the agency on loans it holds for
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Guaranty Agency Financial Report (GAFR) Guide
which the borrower qualifies for teacher loan forgiveness discharge or partial discharge of a
Consolidation loan.
Enter amounts for teacher loan forgiveness discharges and partial discharges of Consolidation
loans, (original and additional requests) for this reporting period.
Example: A guaranty agency pays lenders for three teacher loan forgiveness discharges:
Borrower
Amount
#1
$ 5,000,00
#2
#3
3,000.00
5,000.00
Subtotal
13,000.00
In addition, the guaranty agency has two requests for teacher loan forgiveness discharges
on loans they hold:
Borrower
#4
#5
Subtotal
Amount
$ 1,000,00
$ 500.00
Reinsurance
Reimbursement
1000 - (1000*98%)
500 - (500*95%)
GA
Complement
$20.00
$25.00
$45.00
The amount entered in MR-1-G, Discharges, Principal Amount is $13,045.00.
AMOUNT DUE
TO/(FROM)
GUARANTOR
$30, 525.00
PRINCIPAL
AMOUNT
ITEM
NO.
MR-1
CATEGORY
Claims Paid
MR-1-A
Defaults – Net
$9,500.00
Exempt/Lender-of-last-resort
$5,980.00
MR-1-C
Death/Disability
$2,000.00
MR-1-D
Closed School/False Certification
$ 0.00
MR-1-E
Bankruptcy
$ 0.00
MR-1-F
Unpaid Refunds
$ 0.00
MR-1-G
Discharges
MR-1-B
INTEREST
AMOUNT
OTHER
AMOUNTS
$10,000.00
$13,045.00
Also, see MR-31, Other Transactions Affecting Federal Receivable, to report the federal
receivable portion of teacher loan forgiveness discharges and partial discharges of Consolidation
loans, on guaranty agency held loans.
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MR-2 Borrower Payment Return (Closed School/False Certification)
This category is used to refund collections, including wage garnishment collections, to a guaranty
agency, which were received on a closed school or false certification claim and returned to the borrower
after reinsurance was paid. These collections must be returned by the guaranty agency to the borrower.
Also, include amounts for collections received by the lender, and returned to the borrower by the
guaranty agency after claim payment. This policy applies only to a loan, disbursed in whole or in part, on
or after January 1, 1986. This is a supplemental request for reinsurance, directly related to borrower
payments and not a line item for initial reporting of closed school/false certification reinsurance requests.
This situation is most likely to occur on accounts that were originally paid as defaults where the
borrower made payments to the guaranty agency, and subsequently there was a change in status to closed
school or false certification. Under this situation, if the original default claim was reported in MR-1,
Claims Paid, and was paid at less than 100 percent and the agency reported it in MR-3, Status Change,
for supplemental insurance, the reporting in this Section would be at the 100 percent reimbursement
rate.
On closed school or false certification claims, all collections received by the lender and returned to
the borrower by the agency before reinsurance was paid are reported in MR-1, Claims Paid.
The borrower is entitled to a full refund of these collections and ED must refund the entire
collection amount to the guaranty agency. Collections refer to collection of: principal, purchased interest
(lender interest, guaranty agency claim interest and non-reinsured GA interest), accrued interest, and any
collection charges permitted by law, regulation, or the borrower‘s promissory note.
MR-2 Borrower Payment Return – Amount Due To/ (FROM) Guarantor
MR-2, Borrower Payment Return - Amount Due To/ (From) Guarantor is the sum of amounts
reported in MR-2, Principal Amount, Interest Amount, and Other Amounts. This is a systemcalculated field that does not allow guaranty agency input.
MR-2 Borrower Payment Return - Principal Amount
Enter amount of collections that were applied to the portion of each borrower‘s account that
represents principal and purchased interest. Do not include amounts paid for other charges such as
collection costs, late charges and attorney‘s fees.
MR-2 Borrower Payment Return - Accrued Interest
Enter amount of collections that were applied to the portion of each borrower‘s account that
represents accrued interest.
MR-2 Borrower Payment Return - Other Charges
Enter amount of collections that were applied to the portion of the borrower‘s account that
represents other charges. Include collection costs, late charges and attorney‘s fees.
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MR-3 Status Changes
This category is used for reporting on default claims originally paid at a reduced reinsurance rate but
which are now eligible for full reimbursement because the borrowers‘ claim status has changed. Though
a guaranty agency may be paid at a reduced reinsurance rate on a default claim, the agency is entitled to
receive reimbursement for 100 percent of principal, lender interest, and guaranty agency claim interest on
the following types of claims:
Death or disability;
Closed school, and false certification, and
Bankruptcy
If a guaranty agency pays a default claim for which it receives less than 100 percent reinsurance, and
the status of the borrower claim changes to one of those listed above, the guaranty agency can recoup
the rest of its losses from ED by requesting supplemental reinsurance on the line items below.
Reinsurance default claims paid at 100 percent, and lender-of-last-resort loan (default) claims are not
eligible for supplemental reinsurance if the borrower‘s claim status changes because there is no loss for
the agency to recoup. To request additional reinsurance on a default claim when the status changes to
exempt (for loans disbursed on or after July 1, 2006), report the additional amount in MR-1-B,
Exempt/Lender of Last Resort.
Although this category is used to request the additional portion due the guaranty agency, the account
balance at conversion must also be reported in MR-20 through MR-23. ED uses this information for
accounting and other reporting purposes.
MR-3 Status Changes - Amount Due To/ (From) Guarantor
MR-3, Status Changes, Amount Due To/(From) Guarantor, is the total amount of the unpaid
principal and interest portion of the default claim that the guaranty agency paid to the lender that was
not reimbursed by ED and is still outstanding at the time this supplemental request is submitted to
ED. This total amount is the sum of amounts reported in MR-3-A, Unpaid Principal and Unpaid
Interest through MR-3-C. This is a system-calculated field that does not allow guaranty agency input.
Example:
Borrower #1
Borrower #2
Borrower #3
Borrower
Status
Changes
Default To
D/D
CS/FS
Bankruptcy
Revised: June 2011
ED
Original Claims
Payment to ED Payment Additional Additional
Paid to Lender Original Claims
GA
to GA
Amount due Amount due
Principal
Paid to Lender Principal
Interest
GA GA Amount
Interest Amount
Amt.
Amt.
Principal
Interest
$950.00
$200.00
$4,000 @ 95% $1,000 @ 95% $3,800.00
$50.00
$100 @ 98%
$882.00
$98.00
$18.00
$900 @ 98%
$2.00
$500
@
95%
$950.00
$475.00
$50.00
$1,000 @ 95%
$25.00
5,900.00
1,600.00 $5,632.00
$1,523.00
$268.00
$77.00
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Reporting on GAFR
AMOUNT DUE
TO/(FROM)
GUARANTOR
$345.00
ITEM
NO.
MR-3
Status Changes
MR-3-A
Death/Disability
$200.00
$50.00
MR-3-B
Closed School/False Certification
$18.00
$2.00
MR-3-C
Bankruptcy
$50.00
$25.00
CATEGORY
PRINCIPAL
AMOUNT
INTEREST
AMOUNT
OTHER
AMOUNTS
MR-3-A Death/Disability - Principal and Interest
In the appropriate column (principal amount or interest amount) enter the amount for default
claims for which supplemental reinsurance is being requested due to a change in status of the default
claim to a death or disability claim. Enter the unpaid principal and interest portions of death and
disability claims that the guaranty agency paid to the lender that were not reimbursed by ED and are
still outstanding at the time this supplemental reinsurance request is submitted.
Example: The guaranty agency files a default reinsurance claim for $1000 for a loan first
disbursed on or after October 1, 1993 but before October 1, 1998. The reinsurance request is
for the amount of the claim paid to the lender that is the ―loss‖ the agency incurred. The
guaranty agency is paid 98 percent of this request or $980. The agency has not reached the
trigger for default reinsurance payments for the current fiscal year and is eligible for 98 percent
reinsurance on its losses, for a total of $980. The borrower becomes totally and permanently
disabled the following year. The guaranty agency may now use this Category to request payment
of the $20 (2 percent not paid in reinsurance).
Also, report the account balance at conversion (from default to death and disability) in MR-20,
Default/Lender of Last Resort to Death and Disability.
MR-3-B Closed School/False Certification - Principal and Interest
In the appropriate column (principal amount or interest amount) enter the amount of default
claims for which supplemental reinsurance is being requested due to a change in status of the default
claim to a closed school or false certification claim (include supplemental requests for claims where
the borrower is a victim of identity theft). Enter the unpaid principal and interest portions of closed
school or false certification claims that the guaranty agency paid to the lender that were not
reimbursed by ED and are still outstanding at the time this supplemental reinsurance request is
submitted.
Also, report the account balance at conversion (from default to closed school/false certification)
in MR-21, Default/Lender of Last Resort to Closed School/False Certification.
MR-3-C Bankruptcy - Principal and Interest
In the appropriate column (principal amount or interest amount) enter the amount for default
claims for which supplemental reinsurance is being requested due to change in status of the default
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claim to a bankruptcy claim. Enter the unpaid principal and interest portions of bankruptcy claims
that the guaranty agency paid to the lender that were not reimbursed by ED and are still outstanding
at the time this supplemental reinsurance request is submitted.
If a borrower files for bankruptcy after a default claim was paid to the lender, and the
reinsurance claim was paid at less than 100 percent of principal and interest, the guaranty agency may
claim reimbursement for the complement of the reinsurance in this category.
Also, report the account balance at conversion (from default to bankruptcy) in MR-22,
Default/Lender of Last Resort to Bankruptcy.
During the course of the bankruptcy proceedings, the agency must return and report to ED any
amounts received at the direction of the Bankruptcy Court on line MR-14, Bankruptcy Collections.
Do not net them from the amount reported here. Once bankruptcy proceedings are concluded and:
a repayment plan is established the agency must report and return to ED any amounts
received at the direction of the Bankruptcy Court on line MR-14, Bankruptcy Collections;
the loan is not discharged, it must either be repurchased by a lender or collected on by the
guaranty agency in accordance with program regulations, and the agency must refund to ED
any additional bankruptcy reinsurance payment it received and report it on either MR-7,
Partial Refund – CFY or MR-8, Partial Refund – PFY, as appropriate.
Also, report the account balance at conversion (from bankruptcy to default) in MR-23
Bankruptcy to Default/Lender of Last Resort.
MR-4 TOP Overpayments
The Treasury Offset Program (TOP) category reports activity on accounts after offsets have
occurred. Overpayment refunds are made to borrowers by the guaranty agency when the offset amount
exceeds the balance (principal and interest) due on the borrower‘s account.
MR-4 TOP Overpayments - Amount Due To/ (From) Guarantor
MR-4, TOP Overpayments - Amount Due To/ (From) Guarantor is that portion of the offset
that is in excess of the balance due on the defaulted borrower‘s account that was refunded to the
borrower. This amount is the sum of amounts reported in MR-4, Principal Amount, Interest
Amount and fees (reported in the Other Amounts column) and will be automatically calculated.
This is a system-calculated field that does not allow guaranty agency input.
MR-4 TOP Overpayments – Principal
Enter amount refunded for this TOP offset activity that was applied to the portion of each
borrower‘s account that represents principal and purchased interest. If the amount of the TOP
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Guaranty Agency Financial Report (GAFR) Guide
offset results in the borrower overpaying the amount due on the borrower‘s account, and then
report that portion of the overpayment, which cannot be correctly charged to any category in this
item.
Do not include amounts for other costs such as collection costs, late charges and attorney‘s fees
because they cannot be collected through the TOP offset process.
MR-4 TOP Overpayments – Interest Amount
Enter amount refunded for this TOP offset activity that is applied to the portion of each
borrower‘s account that represents accrued interest.
MR-4 TOP Overpayments – Other Amounts
Enter amount refunded for this TOP offset activity that is applied to the portion of each
borrower‘s account that represents the TOP processing fee.
MR-5 Repurchases - Current Fiscal Year (CFY)
This category is used to refund to ED (―repurchases‖) the amount paid a guaranty agency on a
reinsurance claim because the reinsurance claim was not valid. In conjunction with this, the insurance
claim the guaranty agency paid the lender may not be valid, and the lender may be required to refund the
amount of the insurance claim to the guaranty agency.
Examples:
A borrower moves to study in a foreign country, but the borrower‘s request
for an in-school deferment is misplaced. The lender cannot contact the borrower and
believes the loan should be in repayment. The lender files a default claim. The guaranty
agency pays the claim and receives reinsurance from ED. The agency finally locates the
borrower and determines the borrower should not have been placed in default. The
guaranty agency arranges for the lender to repurchase the loan. The agency then provides a
full refund of the default reinsurance claim to ED.
The guaranty agency files a reinsurance claim for bankruptcy with ED and is paid. The guaranty
agency then receives a notice from the Bankruptcy Court informing the agency that bankruptcy
proceedings have been concluded and that the loan was not discharged. The guaranty agency
must arrange for the lender to repurchase the loan and provide a full refund of the bankruptcy
reinsurance claim to ED. The lender must place the borrower back in repayment although the
borrower could subsequently default on the loan.
A guaranty agency must file a refund if it determines that it made an invalid reinsurance claim. An
agency must also file a refund on any bankruptcy claim where the bankruptcy proceedings were
concluded and the Bankruptcy Court does not discharge the loan. For example a refund would be
required if the borrower does not comply with the requirements of the Wage Earner Plan and the
Bankruptcy Court dismisses the case.
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A guaranty agency must file a full refund of reinsurance to ED within 45 days of:
receiving a notice from the Bankruptcy Court informing the agency that bankruptcy
proceedings have been concluded and that a loan on which ED paid a bankruptcy
reinsurance claim was not discharged, or
In all other cases, unless otherwise directed, the date that the agency discovers that a full
refund of reinsurance is due to ED.
Full refunds of default claims are refunds to ED for the full amount of the default reinsurance.
Refunds are reduced by borrower payments forwarded to ED. If a default reinsurance claim was paid to
the guaranty agency at a reduced reinsurance rate, the refund to ED must be made at that rate. Amount
remitted = (outstanding principal * reinsurance reimbursement rate). The effect of a full refund of a
default claim on a guaranty agency‘s ―trigger figure‖ depends upon whether the agency has a repurchase
agreement with ED:
If a guaranty agency has a repurchase agreement:
ED reduces the total of default claims paid which are subject to the reinsurance trigger
by the amount of the refund. This rule applies if the refund is for a reinsurance default
claim paid during the current federal fiscal year. Once the guaranty agency has exceeded
its trigger for the current federal fiscal year, subsequent full refunds do not affect the
trigger calculation. Instead, the refund amount is credited against default claims paid to
the guaranty agency in the following federal fiscal year.
Full refunds of a reinsurance default claim paid during a previous federal fiscal year do
not affect any trigger calculations.
If a full refund of a default claim is made more than 30 days after the guaranty agency
received the reinsurance payment, the agency must pay ED interest on the repurchased
loan. The interest rate is the rate specified on the borrower‘s promissory note. Report
the unpaid interest from the date of the reinsurance payment until the date the refund is
reported to ED.
A repurchase agreement covers default claims. It does not apply to exempted,
bankruptcy, death and disability, closed school, false certification, or lender-of-last-resort
loan claims because these claims do not affect a guaranty agency‘s trigger figure.
If a guaranty agency does not have a repurchase agreement:
A full refund has no effect on the agency‘s reinsurance trigger calculation.
A guaranty agency is not required to pay interest on full refunds.
Repurchases have two sections. The columns are the same for each section. Each section has five line
items and the items are the same for each section. The purpose of the two sections is to enable ED to
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properly process current and prior fiscal year refunds of guaranty agencies, which have repurchase
agreements with ED, and for ED‘s accounting procedures. Repurchase agreements provide for different
treatment of reinsurance claims paid in a current fiscal year and in prior fiscal years.
For the items in this section enter the information requested in each column, for the claims included
in the reporting period, using the following definitions.
MR-5 Repurchases - CFY - Amount Due To/ (From) Guarantor
MR-5, Repurchases - CFY - Amount Due To/ (From) Guarantor, is the total dollar amount of
current fiscal year repurchased claims for the reporting period for which the guaranty agency is
making a full refund of reinsurance. This amount is the sum of MR-5-A through MR-5-E, Principal
Amount, Interest Amount, and Other Amounts, as applicable. This is a system-calculated field that
does not allow guaranty agency input.
MR-5 Repurchases - CFY - Principal Amount
Enter the outstanding principal amount net of any complement for each type of claim for:
principal,
lender interest,
guaranty agency claim interest,
collection cost for closed school or false certification claims,
allowable outstanding collection costs on rehabilitated loans that subsequently
default,
for closed school or false certification claims the amount of collections the agency
returned to the borrower at the time the claim was paid to the lender, and
accrued interest on a bankruptcy claim if the guaranty agency was required to hold
the loan until it was discharged in bankruptcy.
The Secretary pays accrued interest on a bankruptcy claim if the guaranty agency was required
to hold the loan until it was discharged in bankruptcy. A bankruptcy claim paid to a lender prior
to July 23, 1992 may meet this condition. A Chapter 7 or 11 bankruptcy claim paid to the lender
when the borrower filed for discharge on the grounds of undue hardship, and the loan is
subsequently discharged, also meets this condition. For such a bankruptcy claim, the guaranty
agency is entitled to receive interest that accrued (but was held in forbearance) on the discharged
loan from the date the guaranty agency paid the lender through the earlier of:
60 days after the date the loan was discharged, or
the date the agency‘s reinsurance claim is authorized to be paid by ED
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The lender must repurchase claims paid to lenders prior to July 23, 1992, on which the
borrower has not filed for a hardship discharge, and reinsurance must be returned to ED. In the
case where the agency submits its claim less than 60 days after the loan was discharged, the
agency will be unable to calculate the total amount of accrued interest due because it does not
know the date that ED will authorize the reinsurance claim to be paid. Therefore, the agency
may calculate the amount of interest that accrued through the date the agency files the
reinsurance claim and report it in this column. After the agency receives payment from ED for
the claim, the agency may calculate the additional interest that has accrued from the date the
agency submitted the claim through the earlier of the date that ED authorized payment of the
claim or the 60th day after the loan was discharged. Unless ED notifies the agency, the date ED
authorizes payment of a claim is the date the agency receives the payment.
If the guaranty agency is holding a bankruptcy claim paid to a lender and the Bankruptcy
Court proceedings have been concluded without the loan being discharged, then the guaranty
agency may not file a claim on the loan as a bankruptcy. Instead, the loan goes back into
repayment, with any interest that accrued during the bankruptcy proceedings being capitalized.
The loan must either be repurchased by a lender or collected by the guaranty agency in
accordance with program regulations.
If the loan later goes into default, the guaranty agency may file a default reinsurance claim
with ED at that time.
For a loan on which a bankruptcy claim is paid to a lender on or after July 23, 1992, and the
guaranty agency was not required to hold the claim, the guaranty agency can file for
reimbursement at once. As with a reimbursement of a death or disability claim, the guaranty
agency is not entitled to any interest, which accrues on such a bankruptcy claim between the time
the guaranty agency paid the lender and the time ED pays the agency.
This amount does not include amounts paid to lenders for other items such as late charges,
collection cost, and attorney‘s fees. It also excludes non-reinsurance GA interest. If the nonreinsured GA Interest amount has been capitalized the agency must reduce this amount and
report it in the Other Amounts column. For closed school or false certification claims,
outstanding principal includes any collection costs paid by ED.
MR-5 Repurchases - CFY - Accrued Interest Due ED
Enter the amount of outstanding accrued interest due ED on default claims calculated at the rate
specified on each defaulted borrower‘s promissory note. This applies only if:
it is a default claim
the guaranty agency has a repurchase agreement with ED, and
the refund is made over 30 days after the reinsurance payment.
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The unpaid interest due ED is calculated from the date the original reinsurance reimbursement
payment was received until the date the refund is reported to ED. Interest need not be paid on a
default claim which is refunded within 30 days of the date reinsurance was paid. If no interest is due
on any of the default claims being refunded, enter a zero. If the agency does not have a repurchase
agreement with ED enter zero.
The total refund due ED for this line item is the:
outstanding principal net of any complement plus,
outstanding accrued interest due ED
MR-5 Repurchases - CFY – Other Amounts
Enter the amount of outstanding non-reinsured GA interest which is the outstanding amount as
calculated by the guaranty agency on the loan principal while a lender‘s insurance claim is being
processed by the guaranty agency, but which was not eligible for reinsurance from ED.
Though this interest must be paid to the lender by the guaranty agency as part of an insurance
claim, it is not subject to reinsurance by ED. However, the Secretary of Education is entitled to an
equitable share of any of this interest collected from a borrower.
If non-reinsured GA interest is capitalized in the outstanding principal net of any complement,
the agency must reduce the outstanding principal by the original amount of non-reinsured GA
interest. Reduce the amount reported in the Principal Amount and report the original amount of
non-reinsured GA interest in the Other Amounts column.
MR-5-A Repurchases - CFY - Defaults
Enter the amount related to default claims being refunded in full for which reinsurance was
paid during the current fiscal year for this reporting period. A default claim is one on which the
borrower and endorser, if any, or joint borrowers on a PLUS or Consolidation loan, failed to
make an installment payment when due, or failed to meet other terms of the promissory note, if
the Secretary or guaranty agency finds it reasonable to conclude that the borrower or endorser, if
any, no longer intends to honor the obligation to repay, provided that failure persists:
For loans delinquent before 10/7/98
--180 days for a loan payable in monthly installments and
--240 days for a loan payable in less frequent installments;
For loans delinquent on/after 10/7/98,
--270 days for a loan payable in monthly installments or
--330 days for a loan payable in less frequent installments.
MR-5-B Repurchases - CFY - Exempt /Lender-Of-Last-Resort
Enter the amount related to exempt and lender-of-last-resort claims being refunded for
which reinsurance was paid during the current fiscal year for this reporting period. An exempt
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claim is one on which the borrower defaulted after the lender determined that the borrower or
student failed to establish eligibility for the loan. Also include claims where the student has been
convicted of, or plead nolo contendere to, a crime involving fraud in obtaining title IV student
aid or in cases where the borrower is a victim of identity theft. Exempt claims on loans first
disbursed before July 1, 2006 were subject to reduced reimbursement and the reinsurance
complement should be reduced from amounts reported here. Lender-of-last-resort loans are
loans made only to students who are otherwise unable to obtain loans. A lender-of-last-resort
loan (default) claim is one on which the borrower and endorser, if any, failed to make an
installment payment when due, or to meet other terms of the promissory note.
This is only a general description of exempted and lender-of-last-resort claims. Refer to
appropriate regulations and policy bulletins for specifics.
MR-5-C Repurchases - CFY – Death/Disability
Enter the amount related to death and total disability claims being refunded in full for which a
claim was paid during the current fiscal year for this reporting period. A death claim is one on
which the balance of the loan is canceled due to the borrower‘s death. This includes a Federal
PLUS loan death claim paid to a lender when a student, on whose behalf a parent received the
Federal PLUS loan, dies. A disability claim is one on which the balance of the loan is
conditionally discharged due to the total and permanent disability of the borrower.
MR-5-D Repurchases - CFY - Closed School/False Certification
Enter the amount related to closed school or false certification claims being refunded in full
for which reinsurance was paid during the current fiscal year for this reporting period. A closed
school claim is one on which a claim is paid to a lender because the student was unable to
complete the program in which the student was enrolled due to the closure of the institution. A
false certification claim is one on which a claim is paid to a lender because the student‘s eligibility
to borrow under the FFEL Program was falsely certified by an eligible institution of higher
education.
MR-5-E Repurchases - CFY - Bankruptcy (Chapter 7, 11, 12 and 13)
Enter the amount related to Chapter 7, 11, 12 and 13 bankruptcy claims being refunded in
full for which reinsurance was paid during the current fiscal year for this reporting period.
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Chapter 7 and 11 bankruptcy claims are paid to a lender if:
The borrower has been in repayment status for over 7 years from the date on
which the bankruptcy petition is filed for cases commencing before October 8,
1998, or
The borrower begins an action to receive a discharge on the grounds of undue
hardship.
Chapter 12 or 13 bankruptcy claims are claims paid to lender when a borrower files for
relief under those chapters of the U.S. Bankruptcy Code. During the course of the
bankruptcy proceedings, the agency must report and return to ED, any amounts paid at the
direction of the Bankruptcy Court. These amounts are not refunds.
If the bankruptcy proceedings are concluded and the loan is discharged, then the agency
must report and return to ED, any amounts paid at the direction of the Bankruptcy Court.
These amounts are not refunds.
If the bankruptcy proceedings are concluded and the loan is not discharged, then the
agency must refund in full the outstanding amount of the reinsurance bankruptcy payment it
received from ED. The guaranty agency also must arrange for a lender to repurchase the
loan. The loan reverts to an ―in repayment‖ status at the lender. If the borrower does not
repay the loan after repurchase, then the loan could go into default. The guaranty agency
could pay a default claim on it and file a default reinsurance claim. This assumes all
applicable lender and agency policies concerning defaulted loans were followed.
If the borrower defaulted prior to filing bankruptcy and:
the reinsurance claim was paid at only 98, 95, 90, 88, 85, 80, 78 or 75 percent of
principal and interest and the complement of the reinsurance was paid under
MR-3 C, Status Changes, when the borrower filed bankruptcy, and
the bankruptcy proceedings are concluded and the loan is not discharged, or
the borrower filed for bankruptcy after a default or lender-of-last-resort loan
(default) claim was paid to the lender,
then the agency must refund to ED any additional bankruptcy reinsurance payment it
received in MR-5 and MR-6. The guaranty agency would continue to hold the loan and
attempt to collect on it like any other default claim.
The agency must report and return to ED any amounts paid at the direction of
Bankruptcy Court. These amounts should be reported in MR-14, Bankruptcy
Collections because they are not refunds.
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MR-6 Repurchases for Reinsurance Claims Paid in Prior Fiscal Year
In MR-6-A through MR-6-E enter the information for repurchases of reinsurance claims paid in all
previous fiscal years in this section. This includes any refund of reinsurance where the claim was not paid
in the current fiscal year. Use the instructions for the line items with this same title from the Repurchases
- Current Fiscal Year category, taking into account that this category covers only reinsurance paid in
previous fiscal years.
MR-6 Repurchases - PFY - Amount Due To/ (From) Guarantor
MR-6, Repurchases - PFY - Amount Due To/(From) Guarantor is the total dollar amount of
prior fiscal year repurchased claims for the reporting period for which the guaranty agency is making
a full refund of reinsurance. This amount is the sum of MR-6-A through MR-6-E, Principal
Amount, Interest Amount and Other Amounts, as applicable. This is a system-calculated field that
does not allow guaranty agency input.
MR-7 Partial Refunds - Current Fiscal Year (CFY)
This category is used to refund part of a reinsurance claim paid by ED when a lender refunded part
of the insurance claim paid by the guaranty agency. Borrower payments received by the lender and
forwarded to the guaranty agency are not subject to collection retention and should be reported here.
Borrower payments received by the guaranty agency after the default claim has been paid to the holder
are treated as a collection and should not be reported in this line item.
If the agency receives a claim overpayment from a lender after an insurance claim was paid, but prior
to reinsurance being requested, treat the payment as a refund and reduce the reinsurance claim amount
(MR-1) by the amount refunded.
The guaranty agency must reimburse ED for the entire amount of lenders partial refund and report
this payment as an overpayment refund on all except a default claim. On a default claim, the guaranty
agency can reduce the refund by any complement if reinsurance was originally paid at a reduced rate.
The effect of a partial refund of a default claim on a guaranty agency‘s ―trigger figure‖ depends upon
whether the agency has a repurchase agreement with ED:
If a guaranty agency has a repurchase agreement ED will reduce the total of default
claims paid which are subject to the reinsurance trigger by the amount of the partial
refund. This rule applies if the refund is for a reinsurance default claim paid during the
current fiscal year. Once the guaranty agency has exceeded its trigger for the current
fiscal year, subsequent partial refunds do not affect the trigger calculation. Instead, the
partial refund amount is credited against default claims paid to the guaranty agency in the
following federal fiscal year. A partial refund of a reinsurance default claim paid during a
previous Federal fiscal year does not affect any trigger calculations. A repurchase
agreement only covers default claims.
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If a guaranty agency does not have a repurchase agreement, a partial refund affects the
agency‘s reinsurance trigger calculation up to the time the agency exceeds the trigger.
The trigger is affected only for partial refunds when the reinsurance claim was paid
during the current fiscal year.
Example
Amount of Default Claim Paid to
Lender
GA Reimbursement Rate
Borrower Payment Received
Principal
Interest
Other
$50.00
$25.00
$25.00
$1,000.00
95%
$100.00
GAFR Reporting
______________________________ _________ ______________ ___________ ___________
If borrower payment is received by the MR-1
($1,000 – 100) *
lender and forwarded to the guaranty
95%
agency before the guaranty agency files
=$855.00
for reinsurance.
If borrower payment is received by the MR-7 or ($100 * 95%) =
lender and forwarded to the guaranty
MR-8
$95.00
after lender claim payment.
If borrower payment is received
directly by the guaranty agency after
the default insurance claim has been
paid to the lender.
MR-12 or
MR-13
($50 *95%) less
($50*23%)
=$36.00
($25 * 95%) ($25 * 95%)
less
less
($25 * 23%) ($25 * 23%)
= $18.00
= $18.00
MR-7 Partial Refunds - CFY - Amount Due To/ (From) Guarantor
This amount is the total for partial refund amounts that the guaranty agency is refunding for
all claim types, less any complement, if the reinsurance was originally paid at a reduced
reimbursement rate.
It does not include amounts paid to lenders or the guaranty agency for other items such as late
charges, collection costs, and attorney‘s fees. It also excludes non-reinsured GA interest. MR-7,
Partial Refunds - CFY, Amount Due To/ (From) Guarantor, is the sum of amounts reported in
MR-7-A through MR-7-E, Principal Amount. This is a system-calculated field that does not allow
guaranty agency input.
MR-7-A Partial Refunds - CFY - Defaults
Enter the amount of partial refunds of reinsurance related to default claims for this reporting
period, as defined above.
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Example: The guaranty agency receives a refund from a lender of $100 for a default claim.
Reinsurance was paid at 95 percent. The guaranty agency would refund only $95, that is, 95% of
$100, to ED.
MR-7-B Partial Refunds - CFY – Exempt/Lender-of-Last-Resort
Enter the amount of partial refunds of reinsurance for exempt and lender-of-last-resort claims
for this reporting period, as defined above.
Reinsurance paid on exempt claims for loans first disbursed on or after July 1, 2006, and lenderof-last-resort claims are not subject to a reduced reinsurance rate. Therefore, the guaranty agency
must return to ED the entire amount of any partial refund from a lender for such a claim.
MR-7-C Partial Refunds – CFY – Death and Disability
Enter the amount of partial refunds for death and disability claims for this reporting period, as
defined above. Payments on death or disability claims are not subject to a reduced reinsurance rate.
Therefore, the guaranty agency must return to ED the entire amount of any partial refund from a
lender or the guaranty agency for such a claim.
MR-7-D Partial Refunds - CFY - Closed School or False Certification
Enter the amount of partial refunds for closed school or false certification claims for this
reporting period, as defined above.
Payments on closed school or false certification claims are not subject to a reduced reinsurance
reimbursement rate. Therefore, the guaranty agency must return to ED the entire amount of any
partial refund from a lender or the guaranty agency for such a claim.
MR-7-E Partial Refunds - CFY - Bankruptcy
Enter the amount of partial refunds for Chapter 7, 11, 12 and 13 bankruptcy claims for this
reporting period, as defined above.
Payments on a Chapter 7, 11, 12 and 13 bankruptcy claims are not subject to a reduced
reinsurance rate. Therefore, the guaranty agency must return to ED the entire amount of any
partial refund from a lender or the guaranty agency for such a claim.
MR-8 Partial Refund - Previous Fiscal Year (PFY)
In MR-8-A through MR-8-E enter the information for partial refunds paid in all previous fiscal years
in this section. Use the instructions for the line items with this same title from the Partial Refunds - CFY
Section (MR-7-A through MR-7-E), taking into account that this Section covers only partial refunds paid
in previous fiscal years.
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MR-8 Partial Refunds - PFY, Amount Due To/ (From) Guarantor
MR-8, Partial Refunds - PFY, Amount Due To/ (From) Guarantor, is the sum of amounts
reported in MR-8-A through MR-8-E, Principal Amount. This is a system-calculated field that does
not allow guaranty agency input.
MR- 9 Overstated Claims
This category is used to correct and refund reinsurance if the guaranty agency‘s arithmetic or
typographical errors on previously submitted reinsurance requests and additional reinsurance requests
resulted in the agency, but not the lender, being overpaid. Also use this category to refund to ED partial
amounts paid the agency on supplemental reinsurance requests due to a further change in claim status
back to default if originally paid at less than 100%.
Further changes in status may also require reporting in the Non-Payment Activity Section, MR-20
through MR-23, Status Changes - Account Balance at Conversion.
The guaranty agency must refund to ED the entire amount of the overstated reinsurance claim on all
except a default claim. On a default claim, the guaranty agency can reduce the refund by any
complement if reinsurance was originally paid at a reduced rate.
MR-9 Overstated Claims - Amount Due To/ (From) Guarantor
This amount is the total for overstated claims and refund of partial amounts paid to the guaranty
agency on supplemental reinsurance requests due to a further change in claim status.
MR-9, Overstated Claims - Amount Due To/ (From) Guarantor, is the sum of amounts
reported in MR-9-A through MR-9-E. This is a system-calculated field that does not allow guaranty
agency input.
MR-9-A Overstated Claims - Defaults
Enter the amount of refunds due to overpayment of reinsurance for default claims for this
reporting period. This amount is reduced by the complement of reinsurance if the guaranty
agency was originally paid at a reduced rate.
MR-9-B Overstated Claims - Exempt/Lender of Last Resort
Enter the amount of refunds due to overpayment of reinsurance for exempt and lender of
last resort (default) claims for this reporting period.
MR-9-C Overstated Claims - Death/Disability
Enter the amount of refunds due to overpayment of reinsurance for death and disability
claims for this reporting period.
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MR-9-D Overstated Claims - Closed School/False Certification
Enter the amount of refunds due to overpayment of reinsurance for closed school and false
certification claims for this reporting period.
MR-9-E Overstated Claims - Bankruptcy
Enter the amount of refunds due to overpayment of reinsurance for bankruptcy claims for
this reporting period. Also, include amounts due ED as a result of filing a change in status
supplemental reinsurance request. The account balance at conversion of these status changes
should also be reported in the Non-Payment Activity section, Status Changes - Account Balance
at Conversion, MR-23, Bankruptcy to Default/Lender of Last Resort.
MR-10 Rehabilitated Loans
This category is used to report rehabilitated loan payments due to ED as the result of the sale of
certain defaulted loans to eligible lenders. A rehabilitated loan is one on which a default, exempt or
lender-of-last-resort loan reinsurance claim has been paid. If the borrower then makes 12 months of
consecutive payments, the guaranty agency may sell the loan to an eligible lender. (HERA changed 12
consecutive monthly payments to 9 payments made within 20 days of the due date during 10 consecutive
months. The effective date of this provision is July 1, 2006.) The agency then must repay to ED a
portion of the outstanding principal balance as explained below.
Once the loan is sold back to a lender, the lender is entitled to interest and special allowance
payments. If the loan defaults again, the lender can file a claim with the guaranty agency and the agency
can file a reinsurance claim with ED. The reasonable collection costs assessed the borrower are
capitalized at the time of the loan sale and will be reported as principal if the loan defaults again.
―Reasonable‖ collection costs, in connection with rehabilitation loans, is an amount that does not exceed
18.5 percent of the outstanding amount of principal and accrued interest on the loan at the time the
agency arranges for the lender to purchase the loan or certifies the payoff amount to the purchasing
lender. Collection costs that accrue after rehabilitation cannot be claimed on a subsequent default.
Rehabilitated loan sales to lenders must be reported to ED within 45 days of their occurrence.
The guaranty agency must pay ED an amount equal to 81.5 percent of the outstanding principal
balance on the loan at the time of the sale to the lender, multiplied by the reinsurance percentage in
effect for each portion of the reinsurance claim paid on the loan. For rehabilitated loan reporting, the
outstanding principal balance is defined as the principal amount of the loan, which includes purchased
interest, received by the lender from the guaranty agency for the default claim. Borrower payments
applied may reduce the outstanding principal balance. The outstanding principal balance does not
include any outstanding interest that accrued since the payment of the claim, or outstanding other
charges, such as collection costs, late charges, or attorney‘s fees.
If reinsurance was paid on the loan by multiple reinsurance requests and reinsurance was paid at
different rates, the agency must prorate its rehabilitated loan payment or pay ED at the highest
reinsurance rate used.
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The repayment to ED on the sale of a rehabilitated loan affects a guaranty agency‘s ―trigger figure‖
in all cases except rehabilitated lender-of-last-resort loan (defaults). Lender-of-last-resort loans (defaults)
are exempt from the ―trigger figure‖ calculation.
Rehabilitated loans reduce the total amount of default claims paid which are subject to the
reinsurance trigger by the amount of the repayment. Once the guaranty agency has exceeded its trigger
for the current federal fiscal year, subsequent repayments do not affect the trigger calculation. Instead,
the repayment amount is credited against default claims to the guaranty agency in the following federal
fiscal year. This rule applies whether or not the agency has a repurchase agreement with ED.
Also, include in this item any rehabilitated loans for a loan guarantee transferred from an insolvent
agency under a plan approved by the Secretary.
MR-10 Rehabilitated Loan Refund - Amount Due To/ (From) Guarantor
This is the total amount due to ED for the sale of rehabilitated loans to lenders. This amount
should equal 81.5 percent of the outstanding principal balance on the loan at the time the agency
arranges with the lender to rehabilitate the loan or certifies the payoff amount to the purchasing
lender multiplied by the reinsurance percentage in effect for the reinsurance claims paid on the
loans. The complement should be transferred to the agency‘s federal fund.
MR-10, Rehabilitated Loan Refund, Amount Due To/ (From) Guarantor, is the sum of the
amount reported in MR-10, Principal Amount. This is a system-calculated field that does not
allow guaranty agency input.
MR-10 Rehabilitated Loans - Principal Amount
Enter the federal share of outstanding principal balance. This amount is the outstanding
principal balance that is due to the agency at the time of rehabilitation multiplied by the
reimbursement rate multiplied by 81.5%.
MR-10-A Rehabilitated Loans- Principal Amount (GA Retention)
Even though this line item is entitled Principal Amount it should reflect the GA retention on
the rehabilitated loan at the time of the sale. Enter the amount retained by the guaranty agency
for the sale of rehabilitated loans to lenders. This amount should not exceed 18.5% percent of
the outstanding principal balance on the loan at the time the agency arranges with the lender to
rehabilitate the loan or certifies the payoff amount to the purchasing lender.
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Example: Rehabilitation Loan Calculation (Single Loan)
Reinsurance Reimbursement Rate – 98%
Outstanding Principal and Interest Balance at Time of Rehabilitation – $1,000.00
(Outstanding Principal Balance – $993.27; Accrued Interest – $6.73)
Payoff Amount (for lender to purchase rehabilitated loan) – $1,185.00 [Outstanding
Principal and Interest Balance of $1,000.00 plus Collection Cost of $185.00 ($1,000.00 *
18.5%)]
Complement (formula provided for informational purposes only) – Total Payoff Amount
($1,185.00) less Secretary‘s Share ($793.32), less GA Retention ($183.75), less Accrued
Interest ($6.73), less Other Charges ($185.00) equals $16.20.
Outstanding Principal Balance
Accrued
Interest
Other
Charges
Total
Payoff
Amount
Payoff Amount
$993.27
$6.73
$185.00
$1,185.00
Secretary‘s Share
$993.27 * 98% * 81.5% = $793.32
GA Retention
Complement
(for informational purposes
only)
ITEM
NO.
MR-10
MR-10-A
$993.27 * 18.5% = $183.75
$1,185.00 – $793.32 – $183.75 – $6.73 –
$185.00 = $16.20
CATEGORY
Rehabilitated Loan
Refund
Rehabilitated Loans
AMOUNT DUE
TO/(FROM)
PRINCIPAL
GUARANTOR
AMOUNT
$793.32
$793.32
$183.75
INTEREST
AMOUNT
$6.73
OTHER
AMOUNTS
$185.00
MR-10-A Rehabilitated Loans - Interest
Enter the outstanding accrued interest balance of each borrower‘s account at the time the
rehabilitated loan was sold to a lender.
MR-10-A Rehabilitated Loans - Other Charges
Enter the outstanding other charges balance of each borrower‘s account at the time the
rehabilitated loan was sold to a lender. Other charges include: late charges, collection costs, or
attorney‘s fees.
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MR-11 FFEL Consolidation Refund
This category is used to report Federal default consolidation loan refunds due to ED as a result of
the sale of certain defaulted FFEL loans consolidated into a Federal Consolidation loan.
Default consolidation loan sales to lenders must be reported to ED within 45 days of their
occurrence. The refund amount due ED is the outstanding principal and accrued interest on the loan at
the time of the sale to the lender less the guaranty agency‘s reinsurance complement. The outstanding
principal and accrued interest does not include late charges, collection costs, or attorney‘s fees.
Effective October 1, 2006, guaranty agencies cannot charge the borrower collection costs in excess
of 18.5 percent of the outstanding principal and interest on the defaulted loan at payoff and the guaranty
agency must remit to the Secretary an amount equal to 8.5 percent of the outstanding principal and
interest on the defaulted loan at payoff.
If reinsurance was paid on the loan by multiple reinsurance requests, and reinsurance was paid at
different rates, the agency must prorate its default consolidation payment or pay ED at the highest
reinsurance rate used.
MR-11 FFEL Consolidation Refund - Amount Due To/ (From) Guarantor
This is the amount due to ED for lender consolidation payments. The amount due to ED is the
outstanding principal and accrued interest less the complement of the reinsurance percentage in
effect for the reinsurance claims paid on the loans.
MR-11, FFEL Consolidation Refund - Amount Due To/ (From) Guarantor is the sum of
amounts reported in MR-11, Principal Amount, Interest Amount, and Other Amounts. This is a
system-calculated field that does not allow guaranty agency input.
MR-11 FFEL Consolidation Refund - Principal Amount
Enter the outstanding principal amount of consolidation payments received by the guaranty
agency during the reporting period. Reduce these amounts by the complement of the reinsurance
percentage in effect for the reinsurance claims paid on the loans.
MR-11 FFEL Consolidation Refund - Interest Amount
Enter the outstanding accrued interest amount of consolidation payments received by the
guaranty agency during the reporting period. Reduce these amounts by the complement of the
reinsurance percentage in effect for the reinsurance claims paid on the loans.
MR-11 FFEL Consolidation Refund – Other Amount
Enter the amount of collection costs remitted to the Secretary as a result of a defaulted FFEL
Consolidation. Effective October 1, 2006, this amount should equal 8.5 percent of the 18.5 percent of
the outstanding principal and interest on the loan at the time of payoff. If no collection costs are changed
to the borrower the amount reported here would be zero, however, if any collection costs are charged to
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the borrower, the Secretary is entitled to up to 8.5 percent, even if the collection costs are less than 18.5
percent of the outstanding principal and interest on the loan.
MR-11-A FFEL Consolidation Payoff – Principal Amount
Enter the amount received from the lender at the time of payoff for the principal amount on
the loan.
MR-11-A FFEL Consolidation Payoff – Interest Amount
Enter the amount received from the lender at the time of payoff for the accrued interest
amount on the loan.
MR-11-B FFEL Consolidation GA Retention – Principal Amount
The amount reported in this line item should represent the reinsurance complement on a
Consolidation Loan at the time of loan consolidation. Enter the amount of the reinsurance
complement that is transferred to the agency‘s Federal Fund at the time of consolidation that
represents the complement on the principal amount.
MR-11-B FFEL Consolidation GA Retention - Interest Amount
The amount reported in this line item should represent the reinsurance complement on a
loan at the time of loan consolidation. Enter the amount of the reinsurance complement that
represents the complement on the accrued interest amount. This amount is also transferred to
the agency‘s Federal Fund at the time of consolidation.
MR-11-B FFEL Consolidation GA Retention - Other Amount
The amount reported in this line item should represent the GA‘s collection retention on a
FFEL Consolidation loan. Enter the amount received from the lender at the time of payoff for
the allowable collection cost that cannot exceed 18.5 percent of the outstanding principal and
accrued interest on the loan at the time of payoff. Effective October 1, 2006, this amount is
reduced to 10% and the guaranty agency is required to remit 8.5 percent to the Secretary. The
Secretary‘s share of this collection should be reported in MR-11, FFEL Consolidation Refund,
Other Amounts Column.
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Example: FFELP Loan Consolidation Reporting (Reinsurance Rate = 98%)
Payoff
Amount
$30,000.00
ITEM
NO.
MR-11
Outstanding
Principal
$20,000.00
X 98%
$19,600.00
CATEGORY
FFEL Consolidation Refund
MR-11-A
MR-11-B
Outstanding
Accrued Interest
$10,000.00
X98%
$9,800.00
AMOUNT DUE
TO/FROM
GUARANTOR
$31,950.00
FFEL Consolidation - Payoff
FFEL Consolidation - GA Retention
Other Charges
$30,000.00
X18.5%
$5,550.00
PRINCIPAL
AMOUNT
$19,600.00
INTEREST
AMOUNT
$9,800.00
OTHER
AMOUNTS
2,550.00
$20,000.00
$400.00
$10,000.00
$200.00
3,000.00
MR-12 GA Administrative Wage Garnishment
This category reports on administrative wage garnishment collection activities by the guaranty agency
on loans for which insurance claims have been paid to the lender and which have not been assigned to
ED by the agency. This includes collections of default, exempt and lender-of-last-resort loan (default)
claims on which the guaranty agency is entitled to retain a percentage of the amount collected to pay for
its collection costs. A guaranty agency may not attempt to collect the following types of claims:
bankruptcy (all Chapters)
death and disability
closed school
false certification
GA Administrative Wage Garnishment collections on exempt claims are to be reported in this item.
An exempt claim includes a loan on which the borrower defaulted after the lender determined that the
borrower failed to establish eligibility for the loan. Collections on exempt claims are to be made in
accordance with the instructions in Student Financial Assistance Programs bulletin 89-G-159 dated May
1989.
All collections must be reported to ED within 45 days of the receipt of the collections by the
guaranty agency or its agent, whichever is earlier.
Amounts from collection checks returned for insufficient funds (bounced checks) are deducted prior
to reporting collections to ED.
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MR-12 Administrative Wage Garnishment - Amount Due To/ (From)
Guarantor
This amount represents collections received through administrative wage garnishment
collections by the guaranty agency on loans for which insurance claims have been paid to the
lender and which have not been assigned to ED by the guaranty agency.
Garnishment is the procedure requiring a borrower‘s employer to withhold a portion of a
borrower‘s pay to repay the amount the borrower owes on a default or a lender-of-last-resort loan
(default). A guaranty agency‘s garnishment procedures must comply with Section 488A of the
HEA, appropriate regulations and policy bulletins.
Collections on bankruptcies are under the jurisdiction of Federal Bankruptcy Courts and take
precedence over the administrative wage garnishment provisions of Section 488A. Administrative
wage garnishment cannot be instituted on a borrower who has filed for bankruptcy.
Administrative wage garnishment in effect at the time a borrower files for bankruptcy would have
to cease if the Bankruptcy Court orders a halt to any collection activity against a borrower. Report
collections ordered by the Bankruptcy Court in line item MR-14, Bankruptcy Collections.
Report in this line item the total of the ―Federal share of collections‖ associated with wage
garnishment collections. This refers to that portion of collections that remain after the following
has been deducted:
an amount equal to the complement of the reinsurance percentage which was in
effect when the reinsurance payment was made by the Secretary for default claims,
and
an amount equal to 30 percent of collections for both default and exempted claims to
help the guaranty agency pay for the costs of its collection activities on collections
received before October 1, 1993, or
an amount equal to 27 percent of collections for default, exempted and lender-of-lastresort loan (default) claims to help the guaranty agency pay for the cost of its
collection activities on collections received on or after October 1, 1993 and received
prior to October 1, 1998, or
an amount equal to 24 percent of collections for default, exempted and lender-of-lastresort loan (default) claims to help the guaranty agency pay for the cost of its
collection activities on collections received on or after October 1, 1998 and prior to
October 1, 2003,
an amount equal to 23 percent of collections for default, exempted and lender-oflast-resort loan (default) claims to help the guaranty agency pay for the cost of its
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collection activities on collections received on or after October 1, 2003 and prior to
October 1, 2007, or
an amount equal to 16 percent of collections for default, exempted and lender-oflast-resort loan (default) claims to help the guaranty agency pay for the cost of its
collection activities on collections received on or after October 1, 2007.
A guaranty agency must calculate the amounts that are due to ED.
Calculate amounts based on the reinsurance reimbursement rate that was in effect at the time
the guaranty agency was reimbursed. If a borrower account contains original claims and
additional reinsurance that was paid at different rates, the agency must report its collections at
either:
the rate at which each individual item was paid, or
the highest rate at which any item was paid.
Example: An agency receives a collection on a single borrower‘s account that includes
two claims, one of which received reinsurance reimbursement at the 98 percent rate, and the
other at the 80 percent rate. The agency may prorate the collection and report appropriate
amounts at 98% reinsurance reimbursement and 80% reinsurance reimbursement. As an
alternative to this, the guaranty agency may report the entire collection as 98% Reinsurance
Reimbursement, because this was the highest rate at which one of the items in the account was
reimbursed.
MR-12, GA Administrative Wage Garnishment, Amount Due To/ (From) Guarantor is the
sum of amounts reported in MR-12, Principal Amount, Interest Amount and Other Amounts.
This is a system-calculated field that does not allow guaranty agency input.
Example #1
Wage Garnishment Collections (Reinsurance Reimbursement Rate = 95%)
GA Received the Collection on October 10, 2002 (Collection Retention Rate – 24%)
Total
Collected
$8,000.00
Secretary‘s
Share
GA Retention
ITEM
NO.
MR-12
Principal
Interest
Other Charges
5,000.00
($5000 * .95) - ($5000 *. 24)
= $3,550.00
$5000 * .24 = $1,200
2,000.00
($2000 *. 95) - ($2000 *. 24) =
$1,420.00
$2000 * .24 = $480
1,000.00
($1000 * .95) - ($1000 * .24)
= $710.00
$1000 *.24 = $240
AMOUNT DUE
TO/(FROM) PRINCIPAL INTEREST
OTHER
GUARANTOR AMOUNT AMOUNT AMOUNTS
$
5,680.00
$3,550.00
$1,420.00
$ 710.00
CATEGORY
GA Administrative Wage Garnishment
MR-12-A
Administrative Wage Garnishment - Total Collected
$5,000.00
$2,000.00
$1,000.00
MR-12-B
Administrative Wage Garnishment - GA Retention
$1,200.00
$ 480.00
$ 240.00
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Example #2
Wage Garnishment Collections (Reinsurance Reimbursement Rate = 95%)
GA Received the Collection on October 10, 2007 (Collection Retention Rate – 16%)
Secretary‘s
Share
GA Retention
ITEM
NO.
MR-12
Total
Collected
Principal
Interest
Other Charges
$10,000.00
7,000.00
($5000 * .95) - ($5000 *. 16)
= $5,530.00
$7000 *.16 = $1,120
2,000.00
($2000 *. 95) - ($2000 *.16) =
$1,580.00
$2000 * .16 = $320
1,000.00
($1000 * .95) - ($1000 * .16)
= $790.00
$1000 *.16 = $160
AMOUNT DUE
TO/(FROM) PRINCIPAL INTEREST
OTHER
GUARANTOR AMOUNT AMOUNT AMOUNTS
$
7,900.00
$5,530.00
$1,580.00
$ 790.00
CATEGORY
GA Administrative Wage Garnishment
MR-12-A
Administrative Wage Garnishment - Total Collected
$7,000.00
$2,000.00
$1,000.00
MR-12-B
Administrative Wage Garnishment - GA Retention
$1,120.00
$ 320.00
$ 160.00
MR-12 Administrative Wage Garnishment – Principal Amount
Enter the principal amount due ED on the collection. To calculate the principal amount: (total
collected and applied to principal) multiplied by (appropriate reinsurance rate) less (total collected
and applied to principal) multiplied by (appropriate retention rate) equals Federal share of
collections.
MR-12 Administrative Wage Garnishment – Interest Amount
Enter the accrued interest amount due ED on the collection. To calculate the accrued interest
amount: (total collected and applied to accrued interest) multiplied by (appropriate reinsurance
rate) less (total collected and applied to accrued interest) multiplied by (appropriate retention rate)
equals Federal share of collections.
MR-12 Administrative Wage Garnishment – Other Amount
Enter the other charges amount due ED on the collection. To calculate the other charges
amount: (total collected and applied to other charges) multiplied by (appropriate reinsurance rate)
less (total collected and applied to other charges) multiplied by (appropriate retention rate) equals
Federal share of collections.
MR-12-A Administrative Wage Garnishment –Total Collected Principal
Enter the total amount of collections that were applied to the portion of each borrower‘s
account that represents principal and purchased interest.
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MR-12-A Administrative Wage Garnishment –Total Collected - Interest
Enter the total amount of collections that were applied to the portion of each borrower‘s
account that represents accrued interest.
MR-12-A Administrative Wage Garnishment –Total Collected - Other
Enter the total amount of collections that were applied to the portion of each borrower‘s
account that represents other charges.
MR-12-B Administrative Wage Garnishment – GA Retention – Principal
Enter the total amount of collections that were applied to that portion of the borrower‘s
account that represents principal that is retained by the guaranty agency. To calculate this
amount: multiply the total principal amount by the applicable retention rate.
MR-12-B Administrative Wage Garnishment – GA Retention - Interest
Enter the total amount of collections that were applied to that portion of the borrower‘s
account that represents accrued interest that is retained by the guaranty agency. To calculate this
amount multiply the total accrued interest amount by the applicable retention rate.
MR-12-B Administrative Wage Garnishment – GA Retention - Other
Enter the total amount of collections that were applied to that portion of the borrower‘s
account that represents other charges that is retained by the guaranty agency. To calculate this
amount multiply the total other charges amount by the applicable retention rate.
MR-13 Default Collections
This category reports on default collections by the guaranty agency on loans for which insurance
claims have been paid to the lender and which have not been assigned to ED by the agency. This
includes collections of default, exempt and lender-of-last-resort loan (default) claims on which the
guaranty agency is entitled to retain a percentage of the amount collected to pay for its collection costs.
A guaranty agency may not attempt to collect the following types of claims:
bankruptcy (all Chapters)
death and disability
closed school
false certification
Collections on exempt claims are to be reported in this item. An exempt claim includes a loan on
which the borrower defaulted after the lender determined that the borrower failed to establish eligibility
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for the loan. Collections on exempted claims are to be made in accordance with the instructions in
Student Financial Assistance Programs bulletin 89-G-159 dated May 1989.All collections must be
reported to ED within 45 days of the receipt of the collection by the guaranty agency or its agent,
whichever is earlier.
Amounts from collection checks returned for insufficient funds (bounced checks) are deducted prior
to reporting collections to ED.
MR-13 Default Collections - Amount Due To/ (From) Guarantor
This item is used to report default collections received by the guaranty agency on loans for which
insurance claims have been paid to the lender and which have not been assigned to ED by the
guaranty agency. Report in this line item the total of the ―Federal share of collections‖ associated
with collections. This refers to that portion of collections that remain after the following has been
deducted:
an amount equal to the complement of the reinsurance percentage which was in effect
when the reinsurance payment was made by the Secretary for default claims and,
an amount equal to 30 percent of collections for both default and exempted claims to
help the guaranty agency pay for the costs of its collection activities on collections
received before October 1, 1993,
an amount equal to 27 percent of collections for default, exempted and lender-of-lastresort loan (default) claims to help the guaranty agency pay for the cost of its collection
activities on collections received on or after October 1, 1993 and received prior to
October 1, 1998.
an amount equal to 24 percent of collections for default, exempted and lender-of-lastresort loan (default) claims to help the guaranty agency pay for the cost of its collection
activities on collections received on or after October 1, 1998 and received prior to
October 1, 2003,
an amount equal to 23 percent of collections for default, exempted and lender-of-lastresort loan (default) claims to help the guaranty agency pay for the cost of its collection
activities on collections received on or after October 1, 2003 and received prior to
October 1, 2007, or
an amount equal to 16 percent of collections for default, exempted and lender-of-last
resort loan (default) claims to help the guaranty agency pay for the cost of its collection
activities on collections received on or after October 1, 2007.
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A guaranty agency must calculate the amounts that are due to ED.
Calculate the amounts based on the reinsurance reimbursement rate that was in effect at the time
the guaranty agency was reimbursed. If a borrower account contains original claims and additional
reinsurance that was paid at different rates, the agency must report its collections at either:
the rate at which each individual item was paid, or
the highest rate at which any item was paid.
Example #1
Default Collections (Reinsurance Reimbursement Rate = 98%,
Collections Received by GA on November 1, 2002 (Collection Retention Rate – 24%)
Total
Collected
$38,000.00
Secretary‘s
Share
GA Retention
ITEM
NO.
MR-13
Principal
Interest
Other Charges
15,000.00
($15000 *. 98) - ($15000 *
.24)= $11,100
$15000 * .24 = $3,600
12,000.00
($12000 *. 98) - ($12000 * .24)
= $8,880.00
$12000 * .24 = $2880.00
11,000.00
($11000 * .98) - ($11000 * .24)
= $8,140.00
$11000 * .24 = $2,640.00
AMOUNT DUE
TO/(FROM)
PRINCIPAL INTEREST
OTHER
GUARANTOR
AMOUNT
AMOUNT AMOUNTS
$28,120.00
$11,100.00
$ 8,880.00
$ 8,140.00
CATEGORY
Default Collections
MR-13-A
Default Collections - Total Collected
$15,000.00
$12,000.00
$11,000.00
MR-13-B
Default Collections - GA Retention
$ 3,600.00
$ 2,880.00
$ 2,640.00
Example #2
Default Collections (Reinsurance Reimbursement Rate = 95%)
GA Received the Collection on October 10, 2007 (Collection Retention Rate – 16%)
Total
Collected
$38,000.00
Secretary‘s
Share
GA Retention
ITEM
NO.
MR-13
Principal
Interest
Other Charges
15,000.00
($15000 *. 95) - ($15000 *
.16)= $11,850
$15000 * .16 = $2,400
12,000.00
($12000 *. 95) - ($12000 * .16)
= $9,480
$12000 * .16 = $1,920
11,000.00
($11000 * .95) - ($11000 * .16)
= $8,690
$11000 * .16 = $1,760
CATEGORY
Default Collections
AMOUNT DUE
TO/(FROM)
PRINCIPAL INTEREST
OTHER
GUARANTOR
AMOUNT
AMOUNT AMOUNTS
$30,020.00
$11,850.00
$ 9,480.00
$ 8,690.00
MR-13-A
Default Collections - Total Collected
$15,000.00
$12,000.00
$11,000.00
MR-13-B
Default Collections - GA Retention
$ 2,400.00
$ 1,920.00
$ 1,760.00
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MR-13, Default Collections, Amount Due To/ (From) Guarantor is the sum of amounts reported in
MR-13, Principal Amount, Interest Amount and Other Amounts. This is a system-calculated field
that does not allow guaranty agency input.
MR-13 Default Collections – Principal Amount
Enter the principal amount due ED on the collection. To calculate the principal amount:
(total collected and applied to principal) multiplied by (appropriate reinsurance rate) less (total
collected and applied to principal) multiplied by (appropriate retention rate) equals Federal share
of collections.
MR-13 Default Collections – Interest Amount
Enter the accrued interest amount due ED on the collection. To calculate the accrued interest
amount: (total collected and applied to accrued interest) multiplied by (appropriate reinsurance
rate) less (total collected and applied to accrued interest) multiplied by (appropriate retention
rate) equals Federal share of collections.
MR-13 Default Collections – Other Amount
Enter the other charges amount due ED on the collection. To calculate the other charges
amount: (total collected and applied to other charges) multiplied by (appropriate reinsurance
rate) less (total collected and applied to other charges) multiplied by (appropriate retention rate)
equals Federal share of collections.
Other charges may include late charges, collection costs, and attorney‘s fees
MR-13-A Default Collections –Total Collected - Principal
Enter the total amount of collections that were applied to the portion of each borrower‘s
account that represents principal and purchased interest.
MR-13-A Default Collections –Total Collected - Interest
Enter the total amount of collections that were applied to the portion of each borrower‘s
account that represents accrued interest.
MR-13-A Default Collections –Total Collected - Other
Enter the total amount of collections that were applied to the portion of each borrower‘s
account that represents other charges.
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MR-13-B Default Collections – GA Retention - Principal
Enter the total amount of collections that were applied to that portion of the borrower‘s
account that represents principal that is retained by the guaranty agency. To calculate this
amount: multiply the total principal amount by the applicable retention rate.
MR-13-B Default Collections – GA Retention - Interest
Enter the total amount of collections that were applied to that portion of the borrower‘s
account that represents accrued interest that is retained by the guaranty agency. To calculate
this amount multiply the total accrued interest amount by the applicable retention rate.
MR-13-B Default Collections – GA Retention - Other
Enter the total amount of collections that were applied to that portion of the borrower‘s
account that represents other charges that is retained by the guaranty agency. To calculate this
amount multiply the total other charges amount by the applicable retention rate.
MR-14 Bankruptcy Collections
This category is used to report collections on bankruptcy claims. These collections must be reported
to ED. The Secretary of Education is entitled to 100 percent of collections applied to principal, interest
and other charges on these claims.
This line item includes collections on bankruptcies where:
the loan was initially purchased from the lender as a bankruptcy claim or,
the borrower filed for bankruptcy after a default claim was paid to the lender, the
reinsurance claim was paid at only 98, 95, 90, 88, 85, 80, 78 or 75 percent of principal
and interest, and the complement of the reinsurance was requested by the guaranty
agency, and the guaranty agency reported the change in status to ED in MR-3, Status
Changes, or
the borrower filed for bankruptcy after a default claim was paid to the lender, the
reinsurance claim was paid at 100 percent of principal and interest.
Collections are received on bankruptcy claims at the direction of the Bankruptcy Court. Collections
may be received in increments while the loan is under the jurisdiction of the court. This is typical of
proceedings in a Chapter 13 bankruptcy (a Wage Earner Plan). Collections may also be received as a
lump sum in the distribution of assets at the conclusion of the bankruptcy proceedings.
When a guaranty agency receives a collection payment from the Bankruptcy Court it must report and
return all of it to ED. Since a bankruptcy claim is always paid at the 100 percent reimbursement rate,
there is no deduction for a complement of the reinsurance on a claim‘s collections. Also, a guaranty
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agency may not retain any portion of bankruptcy collections to pay for collection costs. The
guaranty agency can receive amounts for:
Principal,
Purchased Interest (Lender Interest, Guaranty Agency Claim Interest And NonReinsured GA Interest),
Accrued Interest, And
Any collection charges permitted by law, regulation, or the borrower‘s promissory note.
MR-14 Bankruptcy Collections - Amount Due To/ (From) Guarantor
This amount represents the total amount of collections received by the guaranty agency and its
agents from the Bankruptcy Court for the reporting period for reinsurance claims paid as bankruptcy
claims. Included are amounts collected:
while the loan was under the jurisdiction of the Bankruptcy Court, and
as a lump sum at the conclusion of the bankruptcy proceedings, even if the money was
collected after the date the proceedings concluded.
MR-14, Bankruptcy Collections, Amount Due To/ (From) Guarantor is the sum of amounts
reported in MR-14, Principal Amount, Interest Amount and Other Amounts. This is a systemcalculated field that does not allow guaranty agency input.
MR-14 Bankruptcy Collections – Principal Amount
Enter the total amount of bankruptcy collections that were applied to the portion of each
borrower‘s account that represents principal and purchased interest.
MR-14 Bankruptcy Collections – Interest Amount
Enter the total amount of bankruptcy collections that were applied to the portion of each
borrower‘s account that represents accrued interest.
MR-14 Bankruptcy Collections – Other Amount
Enter the total amount of bankruptcy collections that were applied to the portion of each
borrower‘s account that represents other charges.
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MR-15 Default FFEL Consolidated by DL Fee – Amount Due To/ (From)
Guarantor
This line item is used to report the Secretary‘s fee on defaulted Federal Family Education Loans
consolidated by the William D. Ford Direct Loan Program. Guaranty agencies are required to remit to
the Secretary a portion of the collection charge equal to 8.5 percent of the outstanding principal and
interest on the loan. This fee is effective for defaulted loans consolidated on or after October 1, 2006. If
no collection costs are charged, there is no fee due to the Secretary, however, if any collection costs are
charged the Secretary is due up to 8.5 percent of the outstanding principal and interest on the loan.
On and after October 1, 2009, a guaranty agency must remit the entire amount of the collection
costs charged the borrower applicable to a defaulted loan that is paid off with excess consolidation
proceeds. The term ―excess consolidation proceeds‖ is defined in the HEA, as, with respect to any
guaranty agency for any Federal fiscal year beginning on or after October 1, 2009, the proceeds of
consolidation loans received to pay defaulted Title IV loans for that agency that exceed 45 percent of the
agency's total collections on defaulted loans in such Federal fiscal year. The excess consolidation
proceeds should be reported on this line item.
MR-16 Total
The sum of this item equals the sum of amounts reported in MR-1 through MR-15, Amount Due
To/ (From) Guarantor. This is a system-calculated field that does not allow guaranty agency input. The
total will be displayed as a positive number which represents the amount due to the guarantor or a
negative number which represents the amount due ED. Amounts due ED from monthly processing
could be offset by pending Account Maintenance Fee (AMF) or Loan Processing and Issuance Fee
(LPIF) payments. For more detail see Chapter 1, Financial Processing Section.
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NON-PAYMENT ACTIVITY (Accounting Data)
This section reports on guaranty agency monthly activities, which do not involve the receipt or the
disbursement of funds between ED and a guaranty agency. This section includes reporting on the
Treasury Offset Program (TOP) and Status Changes for non-payment activities. All amounts reported
in this section (MR-17 through MR-23) can be positive or negative and must reflect activity that occurred
within the reporting period.
Treasury Offset Program (TOP)
This category reports non-payment activity on accounts after Treasury Offset Program (TOP),
(formerly called IRS offset), have occurred and non-payment information which is used to calculate the
guaranty agency‘s Federal receivable balance.
The guaranty agency initiates action to collect on defaulted loan accounts by way of TOP offset.
Collection of amounts owed on the defaulted loan is offset against the borrower‘s Federal income tax
refunds. The U.S. Internal Revenue Service under the Treasury Offset Program (TOP) makes offsets.
Only principal and interest is offset. All other charges must be collected directly by the guaranty agency
or its agent. The guaranty agency and its agents can continue to receive collections from the borrowers‘
after the TOP procedures have been initiated. Collections received by the guaranty agency are reported
in MR-13, Default Collections.
The agency begins the offset process in October of each year. The TOP begins offsetting income
tax refunds the following January. Attempts to offset will continue until the earlier of:
a borrower‘s Federal income tax refund is offset against the borrower‘s debt,
the guaranty agency stops the TOP offset proceedings on the account,
12 months (January - December) have passed without a TOP offset occurring, or
when the debt is paid in full.
The TOP charges a processing fee to carry out an offset. This amount can change each year. The
processing fee is added to the amount owed on the account when ED sends the information to TOP for
the agency. The processing fee is only charged if an offset occurs. The TOP deducts the fee before
returning the amount collected to ED but it is included in the amount reported to ED.
Amounts collected under the TOP are reported to the guaranty agency. However, the funds
themselves are transferred to ED. This form is used to reconcile TOP Offset transactions and provide
the guaranty agency with any funds due under this process.
Since ED reimburses a guaranty agency for its losses on default claims, ED receives whatever is
collected from borrowers through TOP offset. Collections received as a result of the TOP offset
process are the federal government‘s collection, not the guaranty agencies. This section is also used to
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report when the TOP unknowingly offsets a spouse‘s portion (injured spouse) of a joint income tax
refund. No amounts are deducted for:
the complement of the reinsurance percentage which was in effect when the reinsurance
payment was made by the Secretary for default claims, or
the percent deducted from collections to help the guaranty agency pay for the cost of its
collection activities.
ED uses the information reported in these items for reporting and accounting purposes. Though
the TOP reports some summary level information directly to ED, an agency must provide the detailed
information requested here in order for ED to carry out its responsibilities under law and regulation.
TOP offset activities must be reported within 45 days after the guaranty agency receives notice of TOP
offset from the Department of Treasury.
Principal Amounts Column
The total amount offset or refunded for this TOP offset activity that was applied to the portion
of each borrower‘s account that represents principal and purchased interest. If the amount of the
TOP offset results in the borrower overpaying the amount due on the borrower‘s account, then
report that portion of the overpayment, which cannot be correctly charged to any category in this
column.
Interest Amounts Column
The total amount offset or refunded for this TOP offset activity that is applied to the portion of
each borrower‘s account that represents accrued interest.
Other Amounts Column
The total amount offset or refunded for this TOP offset activity that is applied to the portion of
each borrower‘s account, which represents other charges. Other charges can include only TOP fees.
This column is not applicable for reporting in MR-18, Non-Federal Share Offset.
MR-17 Treasury Offset
Enter the amounts offset against defaulted borrower‘s Federal income tax funds by the U.S.
Internal Revenue Service under the Treasury Offset Program. The amount offset is used to
reduce each borrower‘s FFEL Program loan indebtedness. Report all TOP offsets in this item,
even if it results in the borrower‘s overpaying the amount due in the account. The overpayment
is corrected by refunding the appropriate amount to the borrower and reporting this in item
MR-4, TOP Overpayments.
MR-18 Non-Federal Share Offset
Enter the amount of the non-Federal share offset. The non-Federal share offset is the
portion of the TOP offset, which is an amount equal to the complement of the reinsurance
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percentage, which was in effect when the Secretary made the reinsurance payment for default
claims.
The Other Amounts Column should not be used for this line item since any TOP fees
should be reported on line item MR-4, MR-17, and MR-19, as appropriate. TOP fees are not
applicable to the Non-Federal Share Offset.
MR-19 Treasury Offset Reversals
Enter the amount of Treasury offset reversals. A Treasury offset reversal (formerly injured
spouse claim) is the portion of the TOP offset made against that portion of a Federal income tax
refund which is attributable to the spouse of the defaulted borrower when a joint income tax
return is filed.
The spouse files a claim for this portion with the TOP. The TOP refunds the amount
directly to the spouse, and informs the guaranty agency, which then increases the defaulted
borrower‘s account balance by the amount of the refund.
Status Changes - Account Balance at Conversion
This category reports on guaranty agency activities, which do not involve the receipt or disbursement
of funds between ED and a guaranty agency. ED needs this information for accounting and other
reporting purposes. This category also includes the account balance at conversion for any additional
amounts requested in MR-3, Status Changes.
This category is used to report on reinsurance default and lender-of-last-resort loan (default) claims
paid at 100 percent whose status changed to another claim category. This section is also used to report
change of status for bankruptcies that are not discharged and returned to default or lender-of-last-resort
loan (default) claim status when originally repurchased as a default.
A guaranty agency must report this information to ED when a defaulted borrower:
dies,
becomes totally and permanently disabled,
files for bankruptcy,
has a loan discharged due to school closure, or
has a loan discharged due to false certification by the school.
A change in status of a default claim paid at 100 percent has no effect on the amount of reinsurance
paid on the claim however the status change must be reported in this section.
Change of status for default claims paid at less than 100 percent are reported in MR-3, Status
Changes for reimbursement of the complement. A guaranty agency is entitled to additional reinsurance
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due to such a change. In addition, the account balance at conversion for these additional reinsurance
requests should be reported in this category, MR-20 through MR-22.
Account Balance at Conversion – Principal Amounts Column
The balance for the amount of principal and purchased interest paid to the lender for the default
or lender-of-last-resort loan (default) claim which is still outstanding (that is, collections have not
been received from the borrower on it) at the time this non-payment activity report is submitted to
ED, for each type of claim for the reporting period.
Do not include amounts paid to lenders for other items such as accrued interest, late charges,
collection costs, and attorney‘s fees in this column.
Account Balance At Conversion - Interest Amounts Column
The balance for the amount of accrued interest, which is still outstanding (that is, collections
have not been received from the borrower on it) at the time this non-payment activity report is
submitted to ED, for each type of claim for the reporting period.
Account Balance At Conversion - Other Amounts Column
The balance for the amount of other charges which are still outstanding (that is, collections have
not been received from the borrower on it) at the time this non-payment activity report is submitted
to ED, for each type of claim for the reporting period. This includes amounts for: late charges, collection costs, and attorney‘s fees.
MR-20 Default/LLR to Death and Disability
Enter the amounts for default and lender-of-last-resort loan (default) claims being reported
due to a change in status to death or disability. A death claim is one on which the loan is cancelled due to the borrower‘s death. This includes a Federal PLUS loan death claim paid to a lender
when a student, on whose behalf a parent received the Federal PLUS loan, dies. A disability
claim is one on which the loan is conditionally discharged due to the total and permanent disability of the borrower and the loan is assigned to ED. Also include exempt claims being reported
due to a change in status to death or disability.
MR-21 Default/LLR to Closed School/False Certification
Enter the amounts for default and lender-of-last-resort loan (default) claims being reported
due to the change in status to a closed school or false certification claim. A closed school claim is
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one on which a claim is paid to a lender because the student was unable to complete the
program in which the student was enrolled due to the closure of the institution. A false certification claim is one on which a claim is paid to a lender because the student‘s eligibility to borrow
under the FFEL Program was falsely certified by an eligible institution of higher education. Also
include exempt claims being reported due to a change in status to closed school or false
certification claim.
MR-22 Default/LLR to Bankruptcy
Enter the amounts for default and lender-of-last-resort loan (default) claims being reported
due to the change in status of the default claim to a Chapter 7, 11, 12 or 13 Bankruptcy due to
the Borrower filing for bankruptcy. During the course of the bankruptcy proceedings, the
agency must report and return to ED any amounts paid at the direction of the Bankruptcy Court
on MR-14, Bankruptcy Collections. Also include exempt claims being reported due to a change
in status of the default claim to a Chapter 7, 11, 12 or 13 Bankruptcy.
MR-23 Bankruptcy to Default/LLR
Enter the amounts for Chapter 7, 11, 12 and 13 bankruptcies that are not discharged and
return to default or lender-of-last-resort loan (default) claim status. If the bankruptcy
proceedings are concluded and the loan is not discharged, then the agency must refund to ED
any additional bankruptcy reinsurance payment received and report it on MR-9, Overstated
Claims and return the loan to its original reinsurance rate. The guaranty agency would continue
to hold the loan and attempt to collect on it like any other default or lender-of-last-resort loan
(default) claim. However, the change in status must also be reported in this Section. Also
include exempt claims being reported due to a change in status of the default claim to a Chapter
7, 11, 12 or 13 bankruptcy that are not discharged and return to default or lender or lender-oflast resort loan (default) claim status.
Agency Accruals (Accounting Entries)
This Section reports on amounts owed to ED on accounts held by the guaranty agency, including an
estimate of the age of these amounts. ED uses this information in conjunction with guaranty agency
monthly/quarterly reporting, to calculate guaranty agency‘s Federal receivable balances. The Federal
receivable balance outstanding includes amounts for default, exempt and default lender-of-last-resort
claims, accrued interest and other charges, on which reinsurance has been requested by or paid to the
guaranty agency based upon the account‘s reinsurance percentage rate of 100, 98,95,90,88,85,80,78, or
75.
Example: Borrower loan balance to include Principal, interest and other charges x (times) the
reinsurance applicable loan percentage rate; i.e.
Correct Method Example: Loan balance (amount paid to lender) $100.00 ($100.00 x 95%) = $
95.00 Federal Receivable.
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Do not include in the calculation the lender insurance percentage rate; i.e., $100.00 x 98% x 95%.
This method will create the GA reimbursement amount or reimbursement percentage rate and when
combined with the complement amount creates a non-reported shortage; i.e.
Incorrect Method Example:
Borrower balance
Complement amount
GA Reimbursed amount plus complement
Non-reported
Shortage in Federal Receivable calculation
Original borrower balance
$100.00 * 98% * 95%
($100%-95%) * $100.00
$ 93.10
5.00
98.10
1.90
$ 100.00
This information is also needed in order to adjust ED‘s financial records and comply with federal
government financial reporting requirements. This reporting only concerns FFEL program loans, on
which claims have been paid to lenders and reinsurance has been requested or paid to the guaranty
agency. GA‘s are required to submit this section monthly. All amounts reported in this section (MR-24
through MR-26) can be positive or negative.
Amounts reported on line items MR-24 through MR-26, Agency Accruals, represents the guaranty
activity for the current reporting period, (e.g., monthly).
Principal Amounts Column
The total amount of principal and purchased interest activity for the reporting period, based
upon the account‘s applicable reinsurance percentage (amount paid by ED). Principal includes all
purchased interest because purchased interest must be capitalized by the guaranty agency. This
column is not applicable for reporting on MR-26, Agency Accruals.
Interest Amounts Column
The total amount of accrued interest calculated by the guaranty agency on the loan principal of a
claim for collection from the borrower during the period being reported based upon the account‘s
applicable reinsurance percentage rate (amount paid by ED).
Other Amounts Column
The total amount of fees, penalties, collection charges and any other charges based upon the
account‘s applicable reinsurance percentage rate (amount paid by ED) that has accrued for any loan
for the reporting period.
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MR-24 Collection Terminations
Enter the dollar amount of the portion of federal receivable balances (i.e. loan principal,
accrued interest, and other charges) on which the agency has decided to terminate collection
activities and not to make any further attempt to collect the amount due (i.e., loans with small
balances, less than $100.00). All collection terminations must meet standards approved by ED.
MR-25 Compromises
Enter the dollar amount of the portion of the federal receivable on which the agency has
reached a compromise agreement with the debtor. Compromise refers to a negotiated agreement
between the debtor and the guaranty agency to accept a payment of a lesser portion of the total
debt as full liquidation of the entire indebtedness. Guaranty agencies are permitted in certain
cases to accept a compromise amount from a debtor as full satisfaction of the debt to all parties
(reference Dear Agency Director Notice dated January 21, 1994).
MR-26 Agency’s Accruals
Enter the amount of periodic interest accrued on loan principal for the current reporting
period of the agency (e.g. month). Include interest that is accrued and also collected in the same
period. Also report amounts of additional other charges (e.g., collection costs) added to the
borrowers‘ accounts during the current reporting period. Include all accrued amounts deemed
collectible to which the Secretary is entitled to an equitable share.
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GUARANTY AGENCY
FINANCIAL REPORT
MONTHLY/QUARTERLY
2
Chapter
This Section reports on amounts owed to ED on accounts held by the guaranty agency,
including an estimate of the age of these amounts. ED uses this information in conjunction with
guaranty agency monthly payment reporting, to calculate guaranty agency‘s Federal receivable
balances. This information is also needed in order to adjust ED‘s financial records and comply
with federal government financial reporting requirements. This reporting only concerns FFEL
program loans, on which claims have been paid to lenders and reinsurance has been requested or
paid to the guaranty agency. GA‘s are required to submit this section monthly. All amounts
reported in this section (MR-27 through MR-42) can be positive or negative.
Agency Accruals (Information)
ED uses line items MR-27 through MR-31 in conjunction with guaranty agency monthly
payment reporting, to calculate the guaranty agency‘s Federal receivable balance. The Federal
receivable balance outstanding includes amounts for default, exempt and default lender-of-lastresort claims, accrued interest and other charges, on which reinsurance has been requested by or
paid to the guaranty agency based upon the account‘s reinsurance percentage rate of 100,
98,95,90,88,85,80,78, or 75.
Example: Borrower loan balance to include Principal, interest and other charges x (times)
the reinsurance applicable loan percentage rate; i.e.
Correct Method Example: Loan balance (amount paid to lender) $1,000.00 ($1,000.00 x
95%) = $ 950.00 Federal Receivable.
Amounts reported on line items MR-27 through MR-31, Agency Accruals, represents the
guaranty agency activity for the current reporting period. (e.g. monthly).
Enter all dollar amounts (positive and negative) to the nearest cent, and include decimal point.
Principal Amounts Column
The total amount of principal and purchased interest activity for the reporting period,
based upon the account‘s applicable reinsurance percentage (amount paid by ED). Principal
includes all purchased interest because purchased interest must be capitalized by the guaranty
agency.
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Interest Amounts Column
The total amount of accrued interest calculated by the guaranty agency on the loan
principal of a claim for collection from the borrower during the period being reported based
upon the account‘s applicable reinsurance percentage rate (amount paid by ED).
Other Amounts Column
The total amount of fees, penalties, collection charges and any other charges based upon
the account‘s applicable reinsurance percentage rate (amount paid by ED) that has accrued for
any loan for the reporting period. No reporting is required in the Other Amounts column for line item
MR-32 Ending Balance on Defaulted Loans.
MR-27 Default FFELP Loans Consolidated By Direct Loan
Program
Enter the federal receivable amounts of Federal Family Education Loan Program
loans, which were consolidated in the William D. Ford Direct Loan Program during the
period being reported.
MR-28 Subrogated Loans
Enter the federal receivable dollar amount for subrogated loans (permanent
assignments to ED). Report only on subrogated loans that are accepted by the Debt
Collection Service during the reporting period.
MR-29 Default Loans Transferred Out
Enter the net dollar amount of federal receivables transferred to another guaranty
agency during the reporting period. Report only those accounts that have been accepted by
another guaranty agency during the period being reported. Do not include loan guarantees,
loans in repayment or loans where the status is, or has changed to death, disability,
bankruptcy, closed school, false certification, settled loans or loans written-off.
MR-30 Default Loans Transferred In
Enter the net dollar amount for all federal receivables transferred to the agency from
another guaranty agency during the reporting period. Do not include loan guarantees, loans
in repayment or loans where the status is, or has changed to death, disability, bankruptcy,
closed school or false certification.
MR-31 Other Transactions Affecting Federal Receivable
Enter the net dollar amount affecting the federal receivable that is not reported
elsewhere on this report. Include balances (total balance due) of $25.00 or less that do not
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meet the requirements for MR-24, Collection Terminations or MR-25, Compromises. Any
amounts reported in MR-31 must be accompanied by details (in the GA Comment section
of the GAFR) to support the entry (i.e., reference to line item(s) and applicable amount(s).
Details reported in the GA Comment section should support the total amount reported in
MR-31. Positive amounts represent a decrease in the federal receivable balance and
negative amounts represent an increase in the federal receivable balance.
Until the Guaranty Agency Financial Report (GAFR) is revised, use this line item to
report the federal receivable portion of unpaid refund discharges, teacher loan forgiveness
discharges, and Consolidation loan partial discharges on guaranty agency held loans. Also
use this line item to report rehabilitation loan assignments to the Department under the
Rehabilitation Loan Purchase Program.
Use the GA Comment section of this report to identify all line item adjustments with
corresponding amounts in addition to unpaid refund discharges, teacher loan forgiveness
discharges, and rehabilitated loan assignments. Please indicate for each transaction whether
the transaction is an increase or decrease to the federal receivable balance.
Example: A guaranty agency has two requests for discharges on loans they hold:
Borrower
#1
#2
Subtotal
Amount
$ 1,000,00
500.00
Reinsurance
Reimbursement
1000*98%
500*95%
Federal Receivable
$980.00
$475.00
1,455.00
The amount entered in MR-31, Other Transactions Affecting
Federal Receivable, Principal Amount is $1,455.00.
MR-32 Ending Balance of Defaulted Loans
This dollar amount reflects the agency‘s total outstanding federal receivable on the
accrual basis at month end. The sum of MR-33 through MR-40, Delinquency by Debt
category should equal total principal and interest reported in this line item.
In addition the Department of Education (ED) uses guaranty agency reporting to
establish the federal receivable and check for reasonability. Below is the methodology that
should serve as a guide for reporting the Federal Receivable Balance on Line Item MR-32,
Ending Balance on Defaulted Loans.
Instructions: Start with the preceding periods ending balance as the beginning Federal
Receivable Balance (MR-32, Ending Balance on Defaulted Loans). From that balance add and
subtract the current period activity to arrive at the Federal Receivable Balance at the end of the
period. Then compare the period calculated federal receivable balance with the period‘s ending
balance as reported on MR-32 Ending Balance on Defaulted Loans. Check for reasonability.
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(+)
The preceding periods ending Federal Receivable Balance as reported on MR-32, Ending
Balance on Defaulted Loans.
(+)
Additions to the Federal Receivable Balance:
Claims Paid (Principal)
MR-1-A, Defaults
MR-1-B, Exempt and Lender of Last Resort
Activity on Accounts and Non-Payment Activity (Principal and Interest)
MR-4, TOP Overpayments
MR-18, Non-Federal Share Offset
MR-19, Treasury Offset Reversals
MR-23, Bankruptcy to Default/Lender of Last Resort
Status Changes (Principal and Interest)
MR-3-A, Death/Disability
MR-3-B, Closed School/False Certification
MR-3-C, Bankruptcy
Agency Accruals (Principal and Interest)
MR-26, Agency‘s Accruals
MR-30, Default Loans Transferred In
(-) Decreases to the Federal Receivable Balance
CFY and PFY Repurchases (Principal)
MR-5-A, MR-6-A, Defaults
MR-5-B, MR-6-B, Exempt/Lender of Last Resort
CFY and PFY Partial Refunds (Principal)
MR-7-A, MR-8-A, Defaults
MR-7-B, MR-8-B, Exempt/Lender of Last Resort
Overstated Claims (Principal)
MR-9-A, Defaults
MR-9-B, Exempt/Lender of Last Resort
Payments to ED for Rehabilitated Loans, FFEL Consolidation refunds and collections
on defaulted loans:
MR-10, Rehabilitated Loan Refund (Principal Amount)
MR-10-A, Rehabilitated Loans (Principal and Interest Amounts)
MR-11, FFEL Consolidation Refund (Principal and Interest Amounts)
MR-12, Administrative Wage Garnishment (Principal and Interest)
Mr-12-B, Administrative Wage Garnishment – GA Retention (Principal and
Interest)
MR-13, Default Collections (Principal and Interest)
MR-13-B, Default Collections – GA Retention (Principal and Interest)
Non-Payment Activity (Principal and Interest)
MR-17, Treasury Offset
MR-20, Default/Lender of Last Resort to Death/Disability
MR-21, Default/Lender of Last Resort to Closed School/False Certification
MR-22, Default/Lender of Last Resort to Bankruptcy
MR-24, Collection Terminations
MR-25, Compromises
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MR-27, Default FFEL Consolidated by Direct Loan Program
MR-28, Subrogated Loans
MR-29, Default Loans Transferred Out
(+/-) Increase or Decrease to the Federal Receivable Balance
MR-31, Other Transactions Affecting Federal Receivable
(=) Ending Federal Receivable Balance. The sum of the amounts shown above is used to
derive an ending receivable balance at period end. This Federal Receivable Balance
amount is compared to the Federal Receivable Balance as reported on the GAFR, Line
Item MR-32 at period end. MR-32, Ending Balance on Defaulted Loans should also be
the total of MR-33 through MR-40, Delinquency by Debt Section.
Delinquency by Debt
These line items report amounts owed to ED on accounts held by the guaranty agency at
month end, including an estimate of the age of these amounts. This information is needed in order
to adjust ED‘s financial records and to comply with federal government financial reporting
requirements. On these line items only report FFEL Program loans on which claims have been
paid to lenders and reinsurance has been requested by or paid to the guaranty agency. Report only
on accounts held by the guaranty agency on borrowers‘ loans, whether or not the guaranty agency
has a repayment schedule with the borrower.
Amounts reported on line items MR-32 through MR-40, Delinquency by Debt, represent the
agency‘s outstanding federal receivable balance at the end of the reporting period based upon the
account‘s applicable reinsurance percentage rate. These amounts are cumulative from the inception
of the FFEL program. Include all loans since the beginning of the agency‘s FFEL Program
participation on which default, exempted and default lender-of-last-resort claims have been paid
and on which a balance is outstanding.
Claims permanently assigned to ED are not to be reported in this section because the agency
no longer holds the account.
Do not include amounts for repurchased, rehabilitated loans, defaulted loans consolidated
under FFEL Program or defaulted loans consolidated under the Federal Direct Loan Program.
Also do not include loans for the following types of claims: bankruptcy, death and disability and
closed school or false certification.
When reporting an outstanding balance, which is owed to ED, include only that portion of an
account that is based upon the applicable reinsurance reimbursement rate. Though the guaranty
agency may estimate the outstanding balance for each aging category, the sum of the amounts
reported must accurately reflect the total Federal Receivable at the agency.
MR-33 Not Delinquent
If a borrower complies with a repayment schedule, then the account is reported as not
delinquent. An account is also reported in this line item if the first scheduled payment is not
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due by the last day of the month covered by this report.
MR-34 (1 – 90 Days)
through
MR-40 Over 10 Years
Enter the outstanding dollar amount for the number of days that the borrower is
delinquent:
On the repayment schedule established by the lender before the guaranty agency‘s
payment of the lender‘s claim, or
An amount for accounts that has been scheduled or rescheduled under a
repayment agreement, but the borrower is not meeting the repayment agreement.
The first day of delinquency is the day after the due date of the first missed scheduled or
rescheduled payment not later made.
Since a claim is usually not paid to a lender until after—
180 days of delinquency for loans delinquent before 10/7/98, and
270 days for loans delinquent on or after 10/7/98,
The sum of MR-33 through MR-40 should equal MR-32, Ending Balance on Defaulted
Loans on the accrual basis.
Bankruptcy Reporting
MR-41 Ending Balance on Bankruptcies
Line item MR-41, Ending Balance on Bankruptcies, represents the outstanding bankruptcy
balance at the end of the period being reported and amount is not reduced by any reinsurance
rate but reported at 100% of balance. This amount is cumulative from the inception of the
FFEL program. Enter the dollar amount that reflects the agency‘s total outstanding federal
balance for bankruptcies (at 100% rate) on the accrual basis at the end of the period being
reported.
MR-42 Bankruptcies Transferred Out
Line item MR-42, Bankruptcies Transferred Out, represents the activity for the current
reporting period (report at 100% of balance).
Enter the dollar amount that reflects principal, interest and other charges associated with
bankruptcy accounts transferred to another guaranty agency at 100% rate for the period being
reported (for example bankruptcy transfers to the Educational Credit Management
Corporation (ECMC) or to ED.
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GUARANTY AGENCY
FINANCIAL REPORT
ANNUAL
Chapter
3
The Annual Report (AR) provides the Department with information on the guaranty agency‘s
activities concerning loan guarantees, claims paid to lenders and the agency‘s financial activities,
including activities concerning its Federal Fund, and the agency‘s Operating Fund. Guaranty
agency reporting on the restricted account is no longer required. Information in this section must
reflect activity under all FFEL programs (Federal Stafford, PLUS Loans, Federal SLS, Federal
Consolidation and Unsubsidized Stafford Loans for Middle-Income Borrowers) in, or as of the end
of, the federal fiscal year. The Annual Report must be submitted to ED no later than 60 days after
the end of the federal fiscal year (September 30th).
Amounts reported in the Federal Fund and Operating Fund reflects the annual uniform
financial projections for guaranty agencies. Data collected will also provide the Department a basis
for—
financial reviews,
evaluating the current and projected financial status of guaranty agencies,
projecting the impact of changes in revenue, and
managing guaranty agency federal funds held by the agency.
The guaranty agency‘s books of account must support all amounts reported. The amounts
reported in this report must be on an accrual basis for, or through, the end of the federal fiscal year.
This must be done regardless of the agency‘s method and period of accounting used for its annual
audited financial statements and other financial reports. All amounts reported in this section for
Current Fiscal Year (AR-15 through MR-57) can be positive or negative.
During previous fiscal years several guaranty agencies merged and more agencies may merge or
otherwise change structure in the future. In order to maintain a reasonable database with respect to
the last quarter of operation of an agency, an AR must be completed and submitted to ED by the
merging and succeeding guarantor. If a merger occurs, the merging and successor guaranty agencies
must coordinate to ensure that amounts are not double counted on the Annual Report.
The merging guaranty agency should report on all Annual Report line items, as appropriate, and
according to the instructions.
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The gaining guaranty agency should report on AR-6, Loans Transferred In; and the Federal
Fund balance from the merging guarantor received in AR-20, Federal Fund Other Revenues
After a guaranty agency‘s Annual Report passes all edits and is accepted by ED, it is still
possible that an error may be discovered and an adjustment will be needed. ED defines an
adjustment as a change to an agency‘s annual report after acceptance. Guaranty agencies are
able to submit amended Annual Reports via the GAFR web application only.
NOTE: No amended annual reports should be entered into the Financial Management web
application prior to FSA‘s review and acceptance of the proposed amendment. Proposed
amendments that affect the prior fiscal year‘s Federal Fund balance will not be accepted in the
current fiscal year. These adjustments will have to be made in the next fiscal year. Proposed
amendments that do not affect the Federal Fund balance and are accepted by FSA may be
entered into the Financial Management web application in the current fiscal year.
Enter all dollar amounts to the nearest dollar. Do not include decimal points and cents. ED
always assumes that the last digit in the dollar amount field represents dollars, not cents.
The GAFR Annual Report must be completed and submitted for a federal fiscal year of activity
after the end of that federal fiscal year and must be received by ED within 60 days after the end of
the fiscal year. Enter the Guaranty Agency Code, the Guaranty Agency State Name, and the
Federal Fiscal Year Ending date. Enter the date as MM/CCYY.
Loans in Repayment
This section shows the agency‘s activities concerning loan guarantees and claims paid to
lenders. Report on all loans originally guaranteed by the agency under the FFEL Program, even if
these loans were later canceled or later lost their insurance or reinsurance.
All amounts reported in AR-1 through AR-12 are cumulative since the beginning of the
agency‘s participation in the FFEL Program. Line Items AR-13 and AR-14 should reflect point in
time end-of-fiscal year status.
Information submitted in this section should be consistent with and comparable to relevant
information reported to the National Student Loan Data Systems (NSLDS).
AR- 1 Loans Guaranteed (Except Federal Consolidation)
Enter the original principal guaranteed dollar amount of all loans guaranteed. Do not
reduce by any cancellation. Do not include amounts of loan guarantees transferred in from
another guaranty agency in this item.
AR- 2 All Loans Canceled (Except Federal Consolidation)
Enter the original principal amount of loans canceled before first disbursement, loans
disbursed where the lender‘s check is returned uncashed, the lender‘s check remains uncashed
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120 days after disbursement, the electronic funds transfer (EFT) is not completed, or the
amount of the loan disbursed by EFT is returned within 120 days of the transfer. School
refunds are not to be reported in this line item.
If:
an amount is returned to the lender within 120 days after the lender‘s check is
cashed or the EFT is completed, treat it as a cancellation;
a loan has multiple disbursements, and part is canceled under these conditions, and
the rest is never disbursed, include the cancelled part of the loan amount in this
item (the amount never disbursed); and
only part of a loan is canceled under these conditions, include that part of the loan
amount here.
AR- 3 Federal Consolidation Loans Guaranteed
Enter the original principal dollar amount of federal consolidation loans guaranteed before
any cancellation. Include any interest capitalized by the lender in this item. Also include the
borrower interest due on the underlying loans at the time they are consolidated. Do not
include amounts of loan guarantees transferred in from another guaranty agency in this item.
AR- 4 Federal Consolidation All Loans Canceled
Enter the original principal amount of federal consolidated loans canceled before first
disbursement; loans disbursed where the lender‘s check is returned uncashed; the lender‘s
check remains uncashed 120 days after disbursement; the electronic funds transfer (EFT) is
not completed; or the amount of the loan disbursed by EFT is returned within 120 days of the
transfer.
AR- 5 Uninsured Loans
Enter the original principal amount of loans, which have lost insurance and are not eligible
for cure under ED regulations. When loan losses insurance it means the guaranty agency will
not pay a claim to a lender, or if it did, the lender refunded the claim amount. Any loan, which
loses insurance also, loses eligibility for reinsurance.
Do not include any loan amounts, which were canceled in this item, whether the amount
was canceled before or after disbursement. A canceled loan is not considered to be uninsured
as these terms are used in the annual report.
AR- 6 Loans Transferred In
Enter the original principal amount, net of cancellations prior to or subsequent to the date
of transfer, of all loan guarantees transferred to this agency from other guaranty agencies (prior
to default). Include voluntary and involuntary transfers. A voluntary transfer is at the request
of a borrower, lender or guaranty agency to the agencies involved prior to any claim submittal
to maintain the borrower records with one agency. An involuntary transfer, often referred to
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as the ―Secretary‘s Plan‖ is a transfer directed or requested by the Secretary of Education. The
Secretary‘s Plan protects the interest of the FFEL Program when a guaranty agency faces
insolvency or otherwise may not be able to carry out its program responsibilities.
AR- 7 Loans Transferred Out
Enter the original principal amount, net of cancellations prior to date of transfer, of all
FFEL loan guarantees transferred to another guaranty agency (prior to default). Include loan
guarantees transferred to the Department under the Loan Purchase Programs, as authorized in
legislation titled ―Ensuring Continued Access to Student Loans Act of 2008.‖ Reduce this line
item to reflect the transfer of loans from the Department back to the guaranty agency where a
loan was originally sold in error under the Loan Purchase Program. Entries must be reported
as positive numbers.
AR- 8 Default Claims Paid
Enter the amount paid to lenders for default, exempt (include claims where the student
has been convicted of, or plead nolo contendere to, a crime involving fraud in obtaining title
IV student aid and claims where the borrower is a victim of identity theft) and default lenderof-last-resort loans. A default claim is one on which the borrower failed to make an installment
payment when due as defined in regulations.
Regardless of whether the effective date of the borrower payment, received from a lender
and forwarded to the guaranty agency for the loan, is before or after an insurance claim was
paid, treat the payment as a refund and subtract the amount of refunded principal from this
amount. . Borrower payments received by the lender and forwarded to the guaranty agency,
whether before or after claim payment or receipt of reinsurance, are not subject to collection
retention and should be reported here.
School refunds received before reinsurance claim filing should be deducted from the claim
request amount and school refunds received after reinsurance filing should be treated as a
refund of reinsurance and deducted from amounts reported in this item.
If a lender repurchases (full refund of reinsurance) a loan previously paid as a default, by
the agency, subtract the principal amount that was repurchased by the lender.
If a loan is rehabilitated subtract the amount of outstanding principal on the loan at the
time the loan is rehabilitated. If a defaulted FFEL loan is consolidated under a FFEL
Consolidation loan do not subtract the amount of outstanding principal.
If a defaulted FFEL loan is consolidated under a Federal Direct Consolidation Loan, do
not subtract any amount from this item.
Claims, which lose insurance, must also be deducted from this amount. If ED has paid a
default reinsurance claim to the guaranty agency in such a situation, then the claim amount
must be reported and refunded to ED using the monthly report.
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If the loan loses reinsurance, but not insurance, then leave this amount unchanged.
AR- 9 Bankruptcy Claims Paid
Enter the amount of principal paid to lenders for all types of bankruptcy claims (including
Chapters 7, 11, 12 and 13).
If the agency receives a payment from a lender for the loan after a bankruptcy insurance
claim was paid, treat the payment as a refund and subtract the amount of refunded lender
principal from this amount. However, if the agency receives a payment at the direction of the
Bankruptcy Court during the course of the bankruptcy proceedings, then treat it as a collection
and report it on the monthly report.
If the Bankruptcy Court does not discharge the loan, then the guaranty agency must
arrange for a lender to repurchase it. Subtract the amount of repurchased principal from this
amount. If ED has paid a bankruptcy reinsurance claim to the guaranty agency on the loan,
then the reinsurance claim amount must be reported and refunded to ED, within 45 days, on
the monthly report.
If the borrower subsequently defaults after the repurchase, then treat the loan like any
other default and report the amount in items AR-8, Default Claims Paid-Amount. A guaranty
agency may also file with ED for default reinsurance on the loan using monthly report.
Do not include in this item claims paid as defaults where the borrower files for bankruptcy
after the default claim was paid. Report such default claims in item AR-8, Default Claims
Paid-Amount.
AR-10 Death and Disability Claims Paid
Enter the amount of principal paid to lenders for death, and for total and permanently
disability claims. A death claim is one on which the loan is canceled due to the death of the
borrower or a dependent student. This includes a Federal PLUS loan death claim paid to a
lender when a student, on whose behalf a parent received the Federal PLUS loan, dies. A
disability claim is one on which the loan is conditionally discharged due to the total and
permanent disability of the borrower.
If a lender repurchases a loan, which had been previously paid as a death or disability claim
by the agency (that is, the agency paid an invalid claim), subtract the amount of repurchased
principal from this amount. The lender may also repurchase the loan if a borrower reaffirms a
debt previously paid as a disability claim.
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AR-11 Closed School/False Certification Claims Paid
Enter the amount of principal paid to lenders for closed school and/or false certification
claims. A closed school claim is one on which a claim is paid to a lender because the student
was unable to complete the program in which the student was enrolled due to the closure of
the institution.
A false certification claim is one on which a claim is paid to a lender because the student‘s
eligibility under the FFEL Program was falsely certified by the eligible institution of higher
education.
If a lender repurchases a loan, which had been previously paid as a closed school or a false
certification claim by the agency (that is, the agency paid an invalid claim), subtract the amount
of repurchased principal from this amount.
Also include in this line refund amounts related to unpaid refund, teacher loan forgiveness
and partial discharges of consolidation loans. An unpaid refund, in the case of an open or
closed school, is a discharge of a former or current borrower‘s (and any endorser‘s) obligation
to repay that portion of a FFEL loan (disbursed on or after January 1, 1986) equal to the refund
that should have been made by the school. Include in this amount any accrued interest and
other charges associated with the unpaid refund, which are also discharged.
Teacher loan forgiveness is a discharge of a borrower‘s obligation to repay up to $5,000 or
up to $17, 500 of their outstanding student loan balances. Forgiveness is available to a
borrower who has no outstanding balance on the date he or she obtains a loan after October 1,
1998.
A partial discharge of a Consolidation loan occurs when a loan was obtained jointly by a
married couple if one of the borrowers dies or becomes totally and permanently disabled. The
amount of the Consolidation loan that is discharged is equal to the portion of the outstanding
balance of the Consolidation loan, as of the date the borrower died or became totally and
permanently disabled, attributable to any of that borrower's loans that would have been eligible
for discharge.
In accordance with the unpaid refund, teacher loan forgiveness provisions and the partial
discharge of Consolidation loans provisions, calculate the amount paid to lenders for
discharges. Add to this figure the amount of the reinsurance complement requested by the
agency on loans it holds for which the borrower qualifies for unpaid refund, teacher loan
forgiveness discharge or partial discharge of a Consolidation loan.
AR-12 Loans Paid-In-Full
Enter the original principal amount (net of cancellations) of all loans that have been paidin-full or are presumed paid-in-full (e.g., the loan has been in repayment 12 or more years and
there has been no update to the outstanding balance in four (4) years.
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For loans that were paid through consolidation, report the sum of the original principal
amount for each individual loan that was discharged. This includes Federal Stafford (both
subsidized and unsubsidized, including Unsubsidized Loans for Middle-Income Borrowers),
Federal PLUS Loans and Federal SLS Loans.
Do not include loan amounts in a consolidation due to a Federal Consolidation Loan that
were guaranteed by other agencies. If a Federal Consolidation Loan has been paid-in-full
report the original principal amount of the Federal Consolidation Loan. Underlying loans
associated with a Federal Consolidation Loan should be reported as PIF at the time of
consolidation.
AR-13 Federal Stafford and Unsubsidized Stafford Interim Loans
Enter the principal amounts, net of cancellations, of all Federal Stafford loans and
Unsubsidized Stafford Loans for borrowers who are in school or in their grace period as of
the last day of the reporting year
AR-14 Total Loans in Deferment Prior to First Payment
Enter the original principal amount, net of cancellations, of all FFEL program loans that
entered deferment status before the first payment became due and are in deferment status at
the end of the reporting year.
Financial Report Introduction
The financial activity reported in the Federal Fund, Operating Fund and Balance Sheet sections
should reconcile to the amounts reported on the Guarantor‘s audited financial statements (accrual
basis). If there are any differences between the net assets on the audited financial statement and the
ending balance as submitted on AR-57, Federal Fund Balance in the Balance Sheet Section,
guarantors must submit a schedule explaining those differences to the Department. These
schedules should be sent via e-mail to [email protected]. Data collected will also provide the
Department with a basis for:
financial reviews,
validating the current and projected financial status of guaranty agencies,
projecting the impact of changes in revenue, and
managing guaranty agency federal funds held by the agency.
Federal Fund
The activity reported in this section should reconcile to the amounts reported on the
Guarantor‘s audited financial statements (accrual basis). Projected yearly estimates are required
for line items AR-16 through AR-26, with the exception of AR-24, Transfer to Operating Fund
for Account Maintenance Fee. The ending balance should equal the ending balance on AR-57
(Federal Fund Balance Sheet Section).
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AR-15 Beginning Balance (from AR-26 as of 9/30/XX)
Current Year - Report prior FY ending balance, AR-26.
Projected Years - Same as AR-26, Ending Balance for the previous fiscal year.
AR-16 Investment Income
Current Year - Report investment income recognized in the Federal Fund, including
net increase (decrease) in fair value of investments. If the agency is required by State law to
combine FFEL program funds with other State funds for investment purposes, then the
agency must establish a method for allocating a portion of the earnings to the FFEL
program and must maintain documentation on the allocation method.
Do not include interest earned on the Restricted Account, it should be reported in item
AR-36 Other Revenue (FFEL and Non-FFEL) and earmarked for default prevention
activities.
Interest activity previously reported on AR-49 (Restricted Account Cash, Cash
Equivalents and Investments) should be reported here on AR-16.
Projected Years - Report projected investment income on the Federal Fund.
AR-17 Reinsurance from ED
Current Year – This line item is pre-populated based on monthly reporting and
cannot be changed or modified. Adjustments or discrepancies to the pre-populated amount
should be reported in AR-20, Other Revenues or AR-25, Other Expenses, as appropriate.
The populated amount is the Federal reinsurance from ED, net of refunds, overpayments
and repurchases, for defaults, bankruptcies, death, disability, closed school, false
certification teacher loan forgiveness discharges and unpaid refunds. This amount is
calculated as follows: Amount Due To/(From) Guarantor for MR-1, Claims Paid plus
MR-3, Status Changes, minus MR-5 Repurchases-CFY minus MR-6, Repurchases-PFY,
minus MR-7, Partial Refunds-CFY minus MR-8, Partial Refunds-PFY minus MR-9,
Overstated Claims for the fiscal year being reported.
Projected Years - Defaults on loans originated prior to FFY 94 receive maximum
100% reinsurance. Defaults on loans originated on or after FFY 94 through FFY 98
receive a maximum 98% reinsurance. And defaults on loans originated on or after FFY 98
receive a maximum of 95% reinsurance. Multiply line item AR-21 by the weighted
reinsurance ―percentage‖.
AR-18 Collections of Defaulted Loans – Reinsurance Complement
Current Year - Report the reinsurance complement collected on defaulted loans. This
amount should equal the twelve months reported fiscal year to date (FYTD) on the
monthly GAFR, Line Items MR-10 through MR-13 for the current FFY. The reinsurance
complement is calculated as follows: Total Collected less Secretary‘s Share less GA
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Retention. For comparison and reasonability editing ED will estimate reinsurance
complement on MR-10, Rehabilitated Loans. Guarantors are required to transfer the
complement of the reinsurance rate, which was not reimbursed by the Department on
collections of defaulted loans to the Federal Fund.
Projected Years - Report projected amount of the reinsurance complement from
collections on FFEL loans.
AR-19 Insurance Premiums
Current Year – Report the Federal default fee amount recognized. Effective for loans
guaranteed on or after July 1, 2006, the optional 1 percent insurance premium (guarantee
fee) has been eliminated and replaced by a mandatory Federal default fee. The fee is equal
to 1 percent of the principal amount of loans guaranteed on or after July 1, 2006.
The Federal default fee can either be charged to the borrower by a deduction from the
proceeds of the loan or paid from other non-federal sources. If the borrower is charged a
fee, it must be deducted proportionally from the loan proceeds. The default fee must be
deposited into the agency‘s Federal Fund immediately upon receipt, but no later than 45
days after the loan proceeds have been disbursed by the lender, even if payment is made
from a source other than borrower proceeds.
Projected Years – Enter the amount of projected revenue to be recognized.
AR-20 Other Revenues
Current Year - Report other revenues not reported elsewhere in the Federal Fund
section. Include deferred revenues in this line item. Report itemized entries (description
and amount) to support total reported in this line item. (See Attachment A.) Itemized
entries may include: Secretary‘s Share on collections, Secretary‘s fee on defaulted FFEL
and Direct Loan Consolidation loans (up to 8.5% of collection costs charged the
borrower), excess consolidation proceeds, OIG interest penalty, vehicle sales, audit
findings, IRS refund reimbursement; 48 hour settlement, utilities, and usage fees. These
examples are not all inclusive.
Projected Years - Report other projected revenues not reported elsewhere in the
Federal Fund section. Report itemized entries (description and amount) to support total
reported in this line item. (See Attachment A.)
AR-21 Claims Expensed to Lenders
Current Year – This line item is pre-populated based on monthly reporting and
cannot be changed or modified. Adjustments or discrepancies to pre-populated amount
should be reported in AR-20, Other Revenues or AR-25, Other Expenses, as appropriate.
The populated amount is calculated as follows: AR-21, Claims Expensed to Lenders equals
MR-1-A, Defaults (Other Amounts) plus MR-1-B, Exempt/Lender of Last Resort plus
MR-1-C, Death/Disability plus MR-1-D, Closed School/False Certification plus MR-1-E,
Bankruptcy plus MR-1-F, Unpaid Refunds plus MR-1-G, Discharges) minus MR-5-A
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through MR-5-E Repurchases, CFY, (Principal, Interest and Other Amounts) minus MR6-A through MR-6-E, Repurchases-PFY (Principal, Interest and Other Amounts) minus
MR-7-A through MR-7-E, Partial Refunds-CFY, (Principal Amount) minus MR-8-A
through MR-8-E, Partial Refunds-PFY, (Principal Amount).
Projected Years - Report projected amount of total claims expensed. Provide
methodology for this estimate.
AR-22 Recall of Federal Funds to the Restricted Account
No reporting required for this line item. .
AR-23 Transfer to Operating Fund for Default Aversion
Current Year – Report net Default Aversion expense recognized for delinquent loans
for which agencies receive lender requests for default aversion assistance and for which
payment is authorized under the Department‘s regulation and guidance for the current
federal fiscal year. Amount should agree or be reconcilable to line AR-30, Default
Aversion Fee Revenue.
Projected Years – Project net Default Aversion expense to be recognized for
delinquent loans for which agencies receive lender requests for default aversion assistance
and for which payment is authorized under the Department‘s regulation and guidance for
the current federal fiscal year. Amount should agree or be reconcilable to line AR-30,
Default Aversion Fee Revenue.
AR-24 Transfer to Operating Fund for Account Maintenance Fee
Current Year – As applicable, report the transfer amount, regardless of the actual
transfer, from the Federal Fund for account maintenance fee for the current FY. Amount
should reconcile to line AR-33, Transfer from Federal Fund for Account Maintenance Fee.
AR-25 Other Expenses
Current Year - Report other expenses not reported elsewhere in the Federal Fund
section. Include provision for loan losses (example of calculation provided in AR-56).
Report itemized entries (description and amount) to support total reported in this line item.
(See Attachment A.) Itemized entries may include: Secretary‘s share on collections,
Secretary‘s fee on defaulted FFEL and Direct Loan Consolidation loans (up to 8.5% of
collection costs charged the borrower), excess consolidation proceeds), premium fee
refunds to lenders, early withdrawal counseling fee, GA portion of $250M recall, refund of
insurance premiums, depreciation, IRS tax offset, and prior year accruals.
Projected Years - Report other projected expenses not reported elsewhere in the
Federal Fund section. Report itemized entries (description and amount) to support total
reported in this line item. (See Attachment A.)
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AR-26 Ending Balance
Current Year - The ending balance must equal the sum of AR-15 through AR-20
minus AR-21 through AR-25 as well as the ending balance on AR-57 (Federal Fund
Balance Sheet Section).
Projected Years - The projected ending balance must equal the sum of AR-15
through AR-20 minus AR-21 through AR-25
Supplemental Information
AR-27 Amount transferred from Federal Fund to Operating Fund
for Operating Expenses (Repayable)
No reporting required for this line item. .
AR-28 Amount received from Operating Fund to Repay Advance for
Operating Expenses
No reporting required for this line item.
Operating Fund
The activity reported in this section should reconcile to the amounts reported on the
Guarantor‘s audited financial statements on an accrual basis. Projections are required for line items
AR-29 thorough AR-40, except AR-33 and AR-40.
AR-29 Beginning Balance (from 9/30/XX)
Current Year - Report prior FFY ending balance, AR-40.
Projected Years - Same as AR-40, Ending Balance for the previous fiscal year.
AR-30 Default Aversion Fee Revenue
Current Year – Report DAF revenue recognized for delinquent loans for which
agencies receive lender requests for default aversion assistance and for which payment is
authorized by Department‘s regulations and guidance. Amount should reconcile to line
AR-23, Transfer to Operating Fund for Default Aversion.
Projected Years – Report projected DAF revenue to be recognized for delinquent
loans for which agencies receive lender requests for assistance and for which payment is
authorized by the Department‘s regulations and guidance. Amount should reconcile to line
AR-23, Transfer to Operating Fund for Default Aversion.
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AR-31 Loan Processing and Issuance Fee Revenue
Current Year - Report loan processing and issuance fee revenue recognized.
Projected Years - Report projected loan processing and issuance fee recognized.
AR-32 Account Maintenance Fee Revenue Received from ED
Current Year - Report account maintenance fees recognized from the Department.
Projected Years - Report projected account maintenance fees to be recognized from
the Department.
AR-33 Transfer from Federal Fund for Account Maintenance Fee
Current Year - Report account maintenance fees recognized subject to Federal Fund
settlement (AR-24, Transfer to Operating Fund for Account Maintenance Fee) when
amount exceeds ED‘s budgetary cap.
AR-34 Collections of Defaulted Loans less Reinsurance
Complement (GA Collection Retention)
Current Year –This line item is pre-populated based on monthly reporting and
cannot be changed or modified. Adjustments or discrepancies to the pre-populated
amount should be reported in AR-36, Other Revenues (FFEL and Non FFEL) or AR39, Other Expenditures (FFEL and Non FFEL), as appropriate. The populated
amount is collection revenue recognized from payments to the guaranty agency by
defaulted borrowers.
The pre-populated amount is calculated as follows: AR-34, Collections on
Defaulted Loans (less reinsurance complement) equals MR-10-A, Rehabilitated Loans
(Principal Amount) plus MR-11-B, FFEL Consolidation (Principal and Interest
Amounts) plus MR-12-B, AWG (Principal, Interest, and Other Amounts) plus MR-13B, Default Collections (Principal, Interest and Other).
Projected Years – Report projected collection revenue recognized from payments to
guaranty agency by defaulted borrowers. Amount reported should be your agency share of
collections. Include receipts from rehabilitated loan sales and consolidation of defaulted
loans under the FFEL program. Do not include AR-18 (Reinsurance Complement).
AR-35 Investment Income
Current Year - Enter the amount of all investment income recognized in the
Operating Fund including net increase (decrease) in fair value of investments
Do not include interest earned on the Restricted Account, it should be reported in item
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AR-36, Other Revenue (FFEL and non-FFEL).
Projected Years - Report projected earnings on the Operating Fund investments.
AR-36 Other Revenue (FFEL and Non-FFEL)
Current Year Report other revenue, FFEL and non-FFEL, not reported elsewhere in
the Operating Fund section. This line item should include (1) interest earned on the
interest that was transferred from the Restricted Account; (2) payments received to
consolidate loans under the Direct Loan Program, net of the Secretary‘s fee; (3) collection
costs received from the Department on rehabilitated loan assignments under the
Rehabilitated Loan Purchase Program. Report itemized entries (description and amount) to
support total the total reported in this line item. (See Attachment B.) In addition to the
above mentioned items, itemized entries may include: service income, default aversion and
VFA revenue.
Project Year - Report other projected revenues, FFEL and non-FFEL, not reported
elsewhere in the Operating Fund section. This amount will include interest earned on the
interest that was transferred from the Restricted Account and payments received to
consolidate under the Direct Loan Program, net of Secretary‘s fee. Report projected
itemized entries (description and amount) to support total reported in this line item. (See
Attachment B.)
AR-37 Collections of Defaulted Loans (Secretary Equitable Share)
No reporting required for this line item due to the 48-hour rule. Secretary‘s Equitable
Share should be reported in AR-25, Other Expenses.
AR-38 Operating Expenses
Current Year - Report expenses associated with guaranty agency related activities,
including application processing, loan disbursement, enrollment and repayment status
management, default aversion activities, default collection activities, school and lender
training, financial aid awareness and related outreach activities and compliance monitoring.
Projected Years - Projected expenses associated with guaranty agency related
application processing, loan disbursement, enrollment and repayment status management,
default aversion activities, default collection activities, school and lender training, financial
aid awareness and related outreach activities and compliance monitoring.
AR-39 Other Expenditures (FFEL and Non-FFEL)
Current Year - Report other expenses, FFEL and Non-FFEL, not reported elsewhere
in the Operating Fund section. This will include amounts used for default prevention
activities and the discount portion of discounted rehabilitated loan sales. Report itemized
entries (description and amount) to support total reported in this line item. (See
Attachment B.) Itemized entries may include: 48-hour rule, administration costs, transfers
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Guaranty Agency Financial Report (GAFR) Guide
to federal fund and OIG audit liabilities.
Project Year - Report other projected expenses, FFEL and Non-FFEL, not reported
elsewhere in the Operating Fund section. This will include amounts used for default
prevention activities. Report projected itemized entries (description and amount) to support
total reported in this line item. (See Attachment B.)
AR-40 Ending Balance
Current Year - The ending balance must equal the sum of AR-29 through AR-36
minus AR-37 through AR-39 = AR-40.
Projected Years - The projected ending balance must equal the sum of AR-29
through AR-36 minus AR-37 through AR-39 = AR-40.
Supplemental Information
AR-41 Amount Received from Federal Fund for Operating
Expenses (Repayable)
No reporting required for this line item.
AR-42 Amount Repaid to Federal Fund for Operating Expenses
No reporting required for this line item
Restricted Account
This section reported on all revenues and expenses of the restricted account that was created to
retain the recall amounts required by Section 422(h) of the HEA. This section is no longer
required.
AR-43 Beginning Balance (from 9/30/XX)
No reporting required for this line item.
AR-44 Recall of Federal Funds from Federal Fund
No reporting required for this line item.
AR-45 Investment Income on Restricted Account
No reporting required for this line item. Amounts previously reported here for interest
earned on the Restricted Account is now reported in AR-25, Other Expenses.
AR-46 Investment Income on Restricted Account Expensed for
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Default Prevention
No reporting required for this line item. Amounts previously reported here for earnings
from the Restricted Reserve Account expensed for activities to reduce student loan defaults
is now reported in AR-39, Other Expenditures.
AR-47 Ending Balance
No reporting required for this line item.
Balance Sheet Section (Federal Fund)
The balances reported in this section should reconcile to amounts reported on the Guarantor‘s
audited financial statements Balance Sheet as of the end of the Federal fiscal year 9/30/XX. The
ending balance AR-57 in this section should equal the ending balance on AR-26 (Federal Fund
Activity Section). All reporting should be on an accrual basis and in accordance with GAAP.
AR-48 Cash, Cash Equivalents and Investments
Report cash, cash equivalents and investment (regardless of maturity date of
investments) balances. If applicable, report your Voluntary Flexible Agreement (VFA)
escrow balance in this line item.
AR-49 Restricted Account Cash, Cash Equivalents and Investments
No reporting required for this line item. Do not report escrow balances in this line
item.
AR-50 Net Investment in Property, Plant, Equipment and Inventory
Report balances of property, plant, and equipment less accumulated depreciation.
AR-51 Accounts Receivable from the ED
Report balances owed to the Federal Fund by ED (i.e., reinsurance and other
payments).
AR-52 Other Assets
Report total balances of other current and non-current asset accounts that were not
reported in line items AR-48 through AR-51. Report itemized entries (description, longterm or short-term, and amount) to support total reported in this line item. (See
Attachment C.) Short-term itemized entries may include: guarantee fee receivable,
receivable from Operating Fund, and default aversion fee rebate.
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Guaranty Agency Financial Report (GAFR) Guide
AR-53 Accounts Payable, Accrued Expenses and Other Current
Liabilities
Report liabilities for expenses due, others than ED, including amounts due Operating
Fund and claim payments payable to lenders, if amount is to be paid within 12 months.
Report long-term portion in AR-55 (Other Liabilities).
AR-54 Accounts Payable to ED
Report other liabilities for expenses due ED within the next 12 months.
AR-55 Other Liabilities
Report other liabilities that are not reported in other line items, including outstanding
federal advances due to ED, and the remaining reserve return obligation, to be paid more
than 12 months from current date (i.e., recall for FY 06 and FY 07). Report other shortterm Liabilities in AR-53, Accounts Payable, Accrued Expenses and Current Liabilities
AR-56 Allowances and Other Non-Cash Charges to Federal Fund
Report allowances, such as deferred (unearned) Federal default fees, as well as other
obligations of the Federal Fund. Report itemized entries (description and amount) to
support the total reported in this line item (See Attachment C.). Loan Loss Provision must
also be reported in AR-25 (See page 78). Loan Loss Provision is calculated as follows:
Loan Loss Provision:
Original Principal Outstanding (OPO) x Current Year Default Trigger Rate
without the rehabilitation credit x 3%
OPO = AR1 – AR2 + AR3 – AR4 – AR5 + AR6 – AR7 – AR8 – AR9 – AR10 – AR11AR12
Current Year Default Trigger Rate without the rehabilitation credit = (MR1A
Principal sum for 12 months of the current year – MR7A Principal sum for the 12 months
of the current year) / Prior Year‘s Loans In Repayment (AR1 – AR2 + AR3 – AR4 – AR5
+ AR6 – AR7 – AR8 – AR9 – AR10 – AR11 – AR12 – AR13 – AR14)
AR-57 Federal Fund Balance
The Federal Fund balance on an accrual basis for the fiscal year being reported is
calculated by adding line items AR-48 through AR-52 and subtracting line items AR-53
through AR-56. This amount should represent the equity on the audited balance sheet
section of the Federal Fund. AR-57 must equal AR-26.
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Guaranty Agency Financial Report (GAFR) Guide
ATTACHMENT A – Federal Fund Itemized Schedule
FEDERAL FUND
SCHEDULE OF ITEMIZED LINE ITEMS
ITEM
NO.
CATEGORY
AR-20
OTHER REVENUES:
AR-25
OTHER EXPENSES:
Revised: June 2011
AMT./
CY
ACTUAL
CY + 1
PROJ.
CY +2
PROJ.
Page 87 of 92
CY +3
PROJ.
CY + 4
PROJ.
CY + 5
PROJ.
EXPLANATION
Guaranty Agency Financial Report (GAFR) Guide
ATTACHMENT B – Operating Fund Itemized Schedule
OPERATING FUND
SCHEDULE OF ITEMIZED LINE ITEMS
ITEM
NO.
AR-36
CATEGORY
AMT./
CY
ACTUAL
CY + 1
PROJ.
CY +2
PROJ.
OTHER REVENUES:
FFEL:
NON-FFEL:
AR-39
OTHER
EXPENDITURES:
FFEL:
NON-FFEL:
1. Other Student Financial
Aid related expenditures for
the benefit of students
Revised: June 2011
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CY +3
PROJ.
CY +4
PROJ.
CY + 5
PROJ.
EXPLANATION
Guaranty Agency Financial Report (GAFR) Guide
ATTACHMENT C – Balance Sheet Section Itemized Schedule
BALANCE SHEET SECTION (Federal Fund)
SCHEDULE OF ITEMIZED LINE ITEMS
ITEM
NO.
CATEGORY
AR-52
OTHER ASSETS:
AR-56
ALLOWANCES AND
OTHER NON-CASH
CHARGES TO FEDERAL
FUND:
Revised: June 2011
AMT./
CY
ACTUAL
CY + 1
PROJ.
CY +2
PROJ.
Page 89 of 92
CY +3
PROJ.
CY + 4
PROJ.
CY + 5
PROJ.
EXPLANATION
Guaranty Agency Financial Report (GAFR) Guide
ATTACHMENT D – Guaranty Agency List
Guaranty Agency List
This is a list of the guaranty agencies that currently or previously received payments from ED
under the Federal Family Education Loan Program. Some of these agencies no longer issue loan
guarantees or have closed or merged with other agencies.
Listed below for each guaranty agency (GA) is its guaranty agency code, its guaranty agency
State name, its guaranty agency abbreviation and its full legal name. For brevity and automatic data
processing purposes, ED refers to a guaranty agency by a three-digit code (GA code) or by the
name of the principal State in which it does business (GA State name). ED sometimes also refers
to a guaranty agency by a two-letter abbreviation (GA abbreviation) based on the guaranty agency
State name. Agencies that no longer guarantee loans or have closed or merged with other
agencies are noted with an asterisk.
The Roman numerals in parentheses in some guaranty agency‘s State names are used to
distinguish between agencies in States which have more than one guaranty agency involved in the
Federal Family Education Loan Program. The numerals are assigned from low to high in the order
in which the guaranty agencies signed insurance agreements with the Secretary of Education. This
list is in alphabetical order by GA State name.
Code; GA State Name, GA Abbreviation; Legal Name:
701* Alabama, AL
Alabama Commission on Higher Education
804* Arizona, AZ
Arizona Education Loan Program
705
Arkansas, AR
Student Loan Guarantee Foundation of Arkansas
706
California, CA
Education Credit Management Corporation - California
708
Colorado, CO
Colorado College Access Network
709* Connecticut, CT
Connecticut Student Loan Foundation
710* Delaware, DE
Delaware Postsecondary Education Commission
711* District of Columbia (I), DG
District of Columbia Student Loan Insurance Program
611* District of Columbia (II), DC
Higher Education Assistance Foundation - District of Columbia Region
712
Florida, FL
Florida Student Financial Assistance Foundation
713
Georgia, GA
Georgia Higher Education Assistance Corporation
815* Hawaii, HI
Hawaii Education Loan Program
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Guaranty Agency Financial Report (GAFR) Guide
716*
717
718*
719
620*
721
722
723
724*
725
726
627*
727*
728*
729
730
631*
731
733
734
735
736
737
Idaho, ID
Student Loan Fund of Idaho, Inc.
Illinois, IL
Illinois Student Assistance Commission
Indiana, IN
State Student Assistance Commission of Indiana
Iowa, IA
Iowa College Aid Commission
Kansas, KS
Higher Education Assistance Foundation - Kansas Region
Kentucky, KY
Kentucky, Higher Education Assistance Authority
Louisiana, LA
Louisiana Office of Student Financial Assistance
Maine, ME
Finance Authority of Maine
Maryland, MD
Maryland Higher Education Loan Corporation
Massachusetts, MA
Massachusetts Higher Education Assistance Corporation
Michigan, MI
Michigan Higher Education Assistance Authority
Minnesota (I), MN
Higher Education Assistance Foundation
Minnesota (II), MM
Norstar Guarantee, Inc.
Mississippi, MS
Mississippi Guaranteed Student Loan Agency
Missouri, MO
Coordinating Board for Higher Education
Montana, MT
Guarantee Student Loan Program
Nebraska (I), NB
Higher Education Assistance Foundation - Nebraska Region
Nebraska (II), NE
Nebraska Student Loan Program
New Hampshire, NH
New Hampshire Higher Education Assistance Foundation
New Jersey, NJ
New Jersey Higher Education Assistance Authority
New Mexico, NM
Student Loan Guarantee Corporation
New York, NY
New York State Higher Education Services Corporation
North Carolina, NC
North Carolina State Education Assistance Authority
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Guaranty Agency Financial Report (GAFR) Guide
738
739*
740
741*
742
772*
744
745
746*
747
948*
748
800
749
750
778*
751*
753
654*
755
656*
927
951
North Dakota, ND
North Dakota Guaranteed Student Loan Program
Ohio, OH
Ohio Student Loan Commission
Oklahoma, OK
Oklahoma Guaranteed Student Loan Program
Oregon, OR
Oregon State Scholarship Commission
Pennsylvania, PA
Pennsylvania Higher Education Assistance Agency
Puerto Rico, PR
Puerto Rico Higher Education Assistance Corporation
Rhode Island, RI
Rhode Island Higher Education Assistance Authority
South Carolina, SC
South Carolina Loan Corporation
South Dakota, SD
Education Assistance Corporation
Tennessee, TN
Tennessee Student Assistance Corporation
Texas (I), TC
Texas Higher Education Coordinating Board
Texas (II), TX
Texas Guaranteed Student Loan Corporation
USA Funds, UF
United Student Aid Funds, Inc.
Utah, UT
Utah Higher Education Assistance Authority
Vermont, VT
Vermont Student Assistance Corporation
Virgin Islands, VI
Virgin Islands Joint Boards of Education
Virginia, VA
Virginia State Education Assistance Authority
Washington, WA
Northwest Education Loan Association
West Virginia, WV
Higher Education Assistance Foundation - West Virginia - Region
Wisconsin, WI
Great Lakes Higher Education Corporation
Wyoming, WY
Higher Education Assistance Foundation - Wyoming Region
Minnesota, MB
Education Credit Management Corporation I
Minnesota, MV
Educational Credit Management Corporation II
Revised: June 2011
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| File Type | application/pdf |
| File Title | GAFR Instruction Manual |
| Subject | Updated for CCRAA |
| Author | EPSSIMMONS |
| File Modified | 2011-10-27 |
| File Created | 2011-10-06 |