ORE INS Student Loan Adjustment

On Feb. 23, ORE INS issued bulletin on federal loan forgiveness.

  • ORE INS issued Bulletin DFR 2024-4: Industry guidance on one-time adjustment of federal student loans to assist servicers of commercially owned federal student loans.
  • Seeks to ensure that servicers are aware of a one-time adjustment for Federal Family Education Loan (FFEL) Program loans and Perkins Loans, and make borrowers aware.
  • Such loans may be forgiven if consolidated into federal Direct loans by Apr. 30, 2024.
  • Document dated Feb. 23, 2024, received from ORE INS Feb. 29, summarized Mar. 4.
  • Background
  • US DoE has begun a one-time payment count adjustment for certain federal student loans toward income-drive repayment and public service loan forgiveness (PSFL).
  • The proposed adjustment applies to direct or government owned loans and FFEL borrowers who are working toward forgiveness via their existing payment plan or PSLF.
  • Covered loans in repayment for at least 20 years (undergraduate) or 25 years (graduate) will have their payment counts updated toward these goals.
  • Guidance
  • Because of the significance of having one's loans forgiven, ORE INS expects all servicers to take an active role in ensuring borrowers benefit from the adjustment.
  • Recipients of guidance should communicate to these FFEL and Perkins borrowers.
  • Should train service staff on how borrowers can benefit from the adjustment and how to assist in consolidating to Direct Loan as appropriate for the one-time adjustment.
  • Mar. 2024 ORE INS One-Time Loan Adjustment
  • On Mar. 19, 2024, ORE INS reported on DoE one-time payment count adjustment for certain federal student loans toward the income-driven repayment and PSLF programs.
  • Could lead to borrowers potentially having their loans forgiven if they consolidate commercially owned FFEL or Perkins Loans into a federal Direct Loan by Apr. 30, 2024.

Regulators ORE INS
Entity Types Bank; CNSM; Servicer
Reference PR, 3/19/2024; Bul DFR 2024-4, 2/23/2024
Functions Claims/Accelerated Benefits; Compliance; Product Administration; Reporting; Training
Countries United States of America
Products Banking; Education; Loan
Regions Am
Rule Type Final
Rule Date 2/23/2024
Effective Date 4/30/2024
Rule Id 202781
Linked to N/A
Reg. Last Update 3/19/2024
Report Section US Banking

Last substantive update on 03/22/2024