What is Direct Loan Reconciliation and How Does It Affect Me?

admin ., Business Office Operations, Federal Student Aid Programs, Technology

For those schools new to Direct Loans, reconciliation is a federal requirement and is required of all DL participants. On a monthly basis, schools must ensure that not only do their internal records match (between the FAO and the Business Office), but that their records match with the Department of Education’s.

So, how can you go about this process? First, let’s look at the various resources available to you. In order to balance your school’s records, you will need to run various financial aid and business office loan detail reports. In order to balance with ED, you can refer to your Student Account Summary (SAS), which is generated by COD on the 1st of weekend of each month. You can also go to COD’s website for other DL Reports or you can contact COD and talk to a Reconciliation Specialist. Also available to you through the FSA Download Site, is the Direct Loan Tools Software.

As you proceed with reconciling, you will need to document all of your efforts. You will need to research, document and resolve any discrepancies between the FAO, Business Office & COD systems. Some common discrepancies may include timing issues, drawing down or disbursing in the wrong academic year, unsent disbursement batches, returning excess cash that should have been a payment or issuing a payment that should have been excess cash.

Once all systems match, the loan detail reports balance and any discrepancies have been resolved, your reconciliation is complete!

With many loans hitting accounts in September, it’s important that you have a solid understanding of reconciliation. In order to help schools (specifically those using Banner), The Higher Education Assistance Group, Inc. (HEAG) is pleased to be offering a FREE webinar on Direct Loan Reconciliation on October 29, 2010 at 11 am (EST). This training webinar is intended for financial aid, students accounts or finance department personnel and will focus on Banner and Direct Loan tools. All participants will receive detailed procedural instructions that will help guide you through the process. Again, this is for Banner schools.

Registration deadline is Wednesday, October 27, 2010.

HEAG is a financial aid and higher education consulting group located in Wellesley, MA. More information about us can be found on our website. This webinar is part of a series of free training opportunities provided to colleges and universities. www.heag.us