Department Offers Additional Guidance on Loan Verification Certificates

The U.S. Department of Education issued guidance explaining additional exceptions to the requirement that a loan holder complete a Loan Verification Certificate when it receives the LVC from a consolidating lender.

Dear College Letter GEN-07-03 notes the following additional circumstances in which the loan holder is not required to complete the LVC:

• The loan holder had within the last 90 days completed an LVC on the borrower’s loan for another lender, which would indicate that the borrower may have more than one consolidation-loan application outstanding.
• The borrower appears to have no eligible loans other than a single consolidation loan held by the loan holder. (The National Student Loan Data System or other available records indicate that the borrower already has consolidated all eligible loans.)
• The loan holder receives an LVC that does not include the name and lender-identification number of the eligible lender or trustee lender that received the borrower’s application under Item 19 of the LVC.

These exceptions are in addition to those that the Department previously announced.

The new letter also requires the lender that receives the LVC to report information regarding some exceptions directly to the Department. The letter provides details about the information to report, the reporting format and file-encryption information.

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