Must the school make certain that any default statuses or other negative information in the NSLDS be cleared in the NSLDS before it can disburse Title IV student aid?
A37 No, if the school can document that the student is eligible for Title IV aid despite such negative information contained in the NSLDS, it may award and disburse aid. An example would be if the NSLDS Financial Aid History page of the SAR or ISIR shows that the student has a defaulted loan, but the school has obtained documentation from the holder of the loan that the borrower had made ‘satisfactory arrangements to repay.’ This guidance is consistent with current requirements regarding the resolution of problems reported to a school by the CPS on a SAR or ISIR.” See also Dear Colleague Letter GEN 96-13 GEN 96-13, Q & A 37.
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