# Presentation: 016813

## Session C-04

**TEACH Operational and Processing Information:**
**Part Two (Servicing)**
- Lisa DiCarlo
- Cynthia Battle
- U.S. Department of Education

## TEACH Servicing Calendar

**TEACH Servicing Calendar**

## Slide 3

## In School (Communication)

**In School (Communication)**

- Disclosure statement
- Notice of disbursement (Welcome Letter)
- Quarterly statements

## Disclosure Statement

**Disclosure Statement**

- Upon acceptance of an origination record the COD system generates a TEACH Grant disclosure statement for the student

## Notice of Disbursement 

**Notice of Disbursement**** **

- Once the COD system has an accepted ATS, origination record, actual disbursement record for initial disbursement, the TEACH Grant award is sent to DLSS
- Student receives TEACH Grant Notice of Disbursement generated by DLSS

## Quarterly Statements 

**Quarterly Statements**** **

- On a quarterly basis, DLSS generates a statement notifying recipients of awarded grant amounts and interest accrual if converted to a Direct Unsubsidized Loan (TEACH)

**Notes:**
Interest on the Direct Unsubsidized Loan (TEACH) is 6.8%

Statement is intended to keep the student informed of the financial impacts if he/she does not fulfill or meet the requirements of the TEACH grant program. 

*Would like to include screen shot of quarterly statement. 

## Slide 8

## Separation/Tracking

**Separation/Tracking**

- Grant-to-Loan start date will be set as the separation date plus one (1) day
- Grant-to-Loan end date will be set as eight (8) years from the Grant-to-Loan start date

## Will the recipient have to certify annually while in-school?

**Will the recipient have to certify annually while in-school?**

| If... | Then... |
| --- | --- |
| A new grant is received | No need for certification |
| No grant is received | A certification will be sent to the recipient |

**Notes:**
The Grant Recipient is required to certify annually while in-school. 
The assumption is if a new grant is received, then no need for certification. If no grant is received, a certification will be sent to the recipient. 

## Upon Graduation

**Upon Graduation**

- The recipient must self-certify annually, committing to continue participation within the TEACH Grant Program

**Notes:**
TEACH Grant recipients are required to certify within 120 days of completing or separating from the TEACH Grant eligible program

## Once employed as a teacher

**Once employed as a teacher**

- Servicing will collect evidence of employment (Documentation of Service) each academic year of service that the TEACH Grant recipient fulfills

**Notes:**
Would like to include Documentation of Service screen shot if we have it before the conference. 

## Documentation of Service 

**Documentation of Service **

- Upon completion of each academic year of service, recipient must submit documentation of the service in the form of a certification by chief administrative officer of the school using a form approved by the Department of education
- If the certification form is not received...

## Convert into a 

**Convert into a **
**Direct Unsubsidized Loan (TEACH)**

**Follow Up Request**

**Final Request and Warning**

**Notes:**
1. If a response to the certification letter is not received within 30 days, CSB servicing will send a follow up request to confirm their commitment and warn them that the grant will be converted to a loan if they do not respond. 
2. If response to a follow-up request is not received within 30 calendar days, a final request for the TEACH recipient to confirm their employment as a teacher and warn them that the grant will be converted into a Direct Unsubsidized Loan (TEACH) if they do not respond. 
3. If the TEACH Grant recipient does not respond to the final warning within 30 calendar days, CSB Servicing will convert the TEACH Grant into a Direct Unsubsidized Loan (TEACH).

## Tracking

**Tracking**

- Servicing will track academic year, subject, and school that a TEACH Grant recipient fulfills toward his/her obligation

## Servicing TEACH Grants

**Conversion to Loan**

**In School**

**Separation/**
**Tracking**

**Reporting**

**Financials (Program Overaward)**

**Exit Counseling**

**Maintaining Grant**

**Conversion Triggers**

## Reporting - NSLDS

**Reporting - NSLDS**

## Reporting – Credit Bureaus

**Reporting – Credit Bureaus**

| If recipient has a... | Then... |
| --- | --- |
| TEACH Grant | It is not reported to the credit  bureaus |
| Converted Direct Unsubsidized Loan (TEACH) | It will be reported to the credit bureaus |

## Slide 19

## Financials

**Financials**

- Program Overaward (POVR)
- Schools will follow the same process in place for Pell Grant Overawards
- CSB DMCS will accept and store with unique identifiers for TEACH Grant POVRs

## Financials

**Financials**

- Servicing will receive notification from CSB DMCS when a TEACH Grant POVR is received along with the amount of the overpayments
- Updated reporting of the TEACH Grant amount will be provided to NSLDS

**Notes:**
NOTE: Servicing will receive notification from CSB DMCS when a TEACH Grant POVR payment is received (requirement is in question)

- Servicing will adjust the TEACH Grant balance by the amount of the TEACH Grant POVR as reported by CSB DMCS.

## Slide 22

## Exit Counseling

**Exit Counseling**

- Spring 2009 completion (online)
- Will include information regarding the terms and conditions of the TEACH Grant service agreement
- Counseling must occur within 30 days of separation

**Notes:**
The Exit Counseling will
Provide information about how to identify low-income schools and high need fields
Inform the recipient of the service obligations and opportunity to request suspension of the obligation period and conditions for discharge
 explain the consequences of failing or refusing to complete the service obligation; describe the circumstances of failing or refusing to complete the service obligation.
Explain the terms and conditions of the TEACH Grant service agreement

## Exit Counseling

**Exit Counseling**

- Will describe the circumstances under which a TEACH Grant can be converted into a Direct Unsubsidized Loan (TEACH)
- How it cannot be converted back into a grant
- The consequences of loan default
- Repayment options
- Review the conditions for which deferments and forbearances can be granted

## Slide 25

## Maintaining Grant

**Maintaining Grant**

- Life circumstances
- Meeting service obligations
- Payments while in grant status

## Life Circumstances

**Life Circumstances**

- Enrollment in another TEACH Grant-eligible program (example: Graduate program)
- Call or order to active duty status for more than 30 days in connection with a war, military operation, or national emergency

**Notes:**
Life Circumstances (Ability to suspend the tracking of their teaching obligation period).

## Life Circumstances

**Life Circumstances**

- Birth of a son or daughter
- A serious health condition that makes the recipient unable to perform the functions of the position

- One of the following conditions covered by the Family and Medical Leave Act of 1993

**Notes:**
Family and Medical Leave Act of 1993- Others include
Birth of a son or daughter
Adoption or foster care placement of a son or daughter
Caring for a spouse, son, daughter or parent that has a serious health condition
A serious health condition that makes the recipient unable to perform the functions of the position

## Life Circumstances

**Life Circumstances**

- Tracking of the obligation period will be granted in one-year increments, but cannot exceed three years or in the case of military suspension, will end upon completion of the military service

**Notes:**
Servicing will extend the grant-to-loan ed date each time a Life Circumstance tracking suspension is applied
CSB Servicing will track the total numbers of months for each type of Life Circumstance
Maximum three-year limit for Life Circumstance tracking suspensions will be based on the combination of each type of obligation period with the exception of military suspension that will not have a set limit. 

## Life Circumstance

**Life Circumstance**

- Recipient must apply to Life Circumstance tracking suspension within six months of completing or ceasing the TEACH Grant-eligible program or if they have started teaching, within six months of the date that they have stopped teaching
- Servicing will report the application of life circumstance tracking suspensions to NSLDS

## Meeting Service Obligations

**Meeting Service Obligations**

- Grant recipient must serve as a full-time teacher for a total of 4 academic years within 8 years of completing school
- Grant recipient must teach in a federally designated low-income school

## Designated teaching fields

**Designated teaching fields**

- 	Grant recipient will teach in one of the following fields:
- Math
- Science
- A foreign language
- Bilingual education
- Special education
- Reading specialist
- Another field documented as high need

## Payments while in Grant Status

**Payments while in Grant Status**

- Servicing will **NOT** apply payments for TEACH Grants while in grant status
- If a payment is received specifically directed to a TEACH Grant, CSB Servicing will:
- NOT apply the payment to any other loans that the recipient might have
- Send a notification to the grant recipient informing him/her that payments cannot be applied to TEACH Grants while in grant status

**Notes:**
CSB Servicing will process payments against Direct Loans first by reducing any outstanding fees; any outstanding interest and any remaining payment amount will be applied toward the principle balance of the loans. 
CSB will exclude TEACH Grants (while in grant status) accounts when establishing Electronic Debit Accounts (EDA).
If payment is received that is specifically directed to a TEACH Grant, CSB Servicing will suspend the payment to recycle and refund or apply the payment amount out of DLSS Unapplied file based upon the result of contact with remitter. 
When a payment is received specifically directed to a TEACH Grant, CSB Servicing will send a notification to the grant recipient informing him/her that payments cannot be applied to TEACH Grants while in grant status....and ask him/her if she wants to convert the grant into a loan.

## Payments while in grant status

**Payments while in grant status**

- If grant recipient makes payments within 120 days of the disbursement of a TEACH Grant
- the payment will be processed as a cash cancellation
- COD will be notified of the adjustment and increase their eligibility by the same amount

## Slide 35

## Conversion Triggers

**Conversion Triggers**

- Requests conversion
- Fails to certify within 120 days of ceasing enrollment prior to completing program.

- Fails to certify annually his/her intention to satisfy service agreement
- Fails to begin or maintain qualified employment

- When the TEACH Grant recipient...

**Notes:**
Requests conversion...because he/she decided not to teach for any reason
Fails to certify within 120 days of ceasing enrollment prior to completing program
Fails to certify annually his/her intention to satisfy service agreement
Fails to begin or maintain qualified employment within the timeframe that would allow the individual to complete service obligations within the eight-year period.

## Slide 37

## Conversion to Loan

**Conversion to Loan**

- A TEACH Grant will convert into a Direct Unsubsidized Loan (TEACH) when a recipient **fails or refuses** to carry out their service obligation
- Recipient will enter repayment upon conversion of the grant to a Direct Unsubsidized Loan (TEACH)

**Notes:**
Grant to Loan Conversions (TEACH Grants will convert into a Direct Unsubsidized Loan (TEACH) when a recipient fails or refuses to carry out their service obligations)

- Grant TEACH recipient will be subject to repayment of his or her Direct Unsubsidized Loan (TEACH) including interest accruing from the date of the grant award. 

## When Converted 

**When Converted **

- Capitalization of unpaid interest will occur on the date entering repayment PLUS 6 months (to provide the recipient an opportunity to pay the interest prior to capitalization)

**Notes:**
Chart will include what balances/totals will look like if student pays interest or if it is capitalized. 
Payments received before and after capitalization will continue to follow existing payment application rules (late charges/fees first, interest next, then principal). 
Note servicing currently does not asses fees. 

## Questions?

**Questions?**

## Contact Information

- Thank You!
- We appreciate your feedback and comments.
**Lisa DiCarlo**
- Director, Direct Loan Operations
- l_[isa.dicarlo@ed.gov](mailto:Lisa.dicarlo@ed.gov)_
- (202) 377-3129
**Cynthia Battle**
- _[Cynthia.Battle@ed.gov](mailto:Cynthia.Battle@ed.gov)_
- (202) 377-3261

**Contact Information**