FINANCIAL ASSISTANCE COMMISSION
|LPM NO.:||L2002-4||Effective Date:||As Indicated|
|Pub. Date:||March 14, 2002||Distribution:||Lenders and Schools|
|Topic:||Common Manual Update|
To assure that your Common Manual remains current, please record this document on your LPM/LPB index, and retain it in Appendix E of your manual.
The following summary informs schools, lenders, and servicers of the latest Common Manual policy changes. These changes will appear in the manual's next annual update in 2002. However, these changes are effective before the next update is scheduled to be delivered.
Loans Not Eligible for Bankruptcy Claim Payment
Common Manual bankruptcy policy has been revised to clarify that if a loan is in any status other than repayment at the time the bankruptcy notification is received by the lender, the lender should ascertain the correct status for a loan at the conclusion of the bankruptcy action and place the loan into the applicable status. Prior policy language may have inadvertently implied that the loan should be returned to the previous loan status, as opposed to the applicable loan status, at the conclusion of the bankruptcy action.
|Affected Sections:||8.2.D., CCI8.2.D.|
|Effective Date:||Retroactive to the implementation of the Common Manual.|
|Policy Information:||Reference 561|