Department Issues New Promissory-Note Addendum and Plain Language Disclosure

The U.S. Department of Education announced the availability of a Federal Stafford-loan promissory-note addendum and Plain Language Disclosure that reflect the changes in annual loan limits that take effect July 1, 2007. Dear Colleague Letter FP-07-02 also notes that the new Plain Language Disclosure clarifies that some loans with variable interest rates have a rate that is lower during in-school, grace and deferment periods, but higher during repayment and forbearance. Participants in the Federal Family Education Loan Program should begin using these updated forms immediately.