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 RAP

FINANCIAL DISCLOSURE FOR REASONABLE AND AFFORDABLE 

REHABILITATION PAYMENTS

William D. Ford Federal Direct Loan (Direct Loan) Program

Federal Family Education Loan (FFEL) Program

OMB No. 1845-0120

Form Approved

Exp. Date 03/31/2017

WARNING: Any person who knowingly makes a false statement or misrepresentation on this form or on any accompanying 

document is subject to penalties that may include fines, imprisonment, or both, under the U.S. Criminal Code and 20 U.S.C. 1097.

SECTION 1: BORROWER IDENTIFICATION

Please enter or correct the following information.

Check this box if any of your information has changed.

SSN

Name

Address

City, State, Zip

Telephone – Primary

Telephone – Alternate

E-mail (optional)

___ ___ ___ - ___ ___ - ___ ___ ___ ___

____________________________________

____________________________________

____________________________________

( _______ ) _______ - _____________ 

( _______ ) _______ - _____________

____________________________________

SECTION 2: HOUSEHOLD INCOME AND REASONABLE AND NECESSARY MONTHLY EXPENSES

You have received this form because you requested the opportunity to rehabilitate your defaulted Direct Loan(s) and/or 

FFEL Program Loan(s) and objected to the monthly payment amount your loan holder calculated using the 15 percent 

formula (15% of the amount by which your Adjusted Gross Income exceeds 150% of the poverty guideline amount 

applicable to your family size and state, divided by 12). Before completing this section, carefully read the entire form, 

including the instructions and definitions in Sections 5, 6, and 7. Your loan holder will use the information you provide 

on this form to determine an alternative reasonable and affordable monthly payment amount. If you want to 

rehabilitate your defaulted loan(s) you must choose to make qualifying payments in either the payment amount

calculated using the 15 percent formula or the alternative payment amount determined based on the information you 

provide on this form. Once you choose the payment amount you want to make you must make 9 on-time payments of 

that amount over the next 10 months. 

Provide the monthly income and expense information listed below. Do not include documentation of these sources of 

income or expenses unless requested to do so by your loan holder. Do not include your spouse’s income if your spouse 

does not contribute to your household income. Your loan holder has the authority to determine if the claimed amount 

of any expense is reasonable and necessary. 

MONTHLY INCOME

1. Your employment income : $______________

2. Spouse’s employment income : $______________

3. Child support payments received: $______________

4. Social Security benefits: $______________

5. Worker’s compensation: $______________

6. Public assistance: $______________

List type(s): __________________________________

7. Other income: $______________

Describe: ____________________________________

8. Total Monthly Income: $______________

(Sum of items 1 through 7)

MONTHLY EXPENSES

9. Food: $______________

10. Housing: $______________

11. Utilities: $______________

12. Basic communication: $______________

13. Necessary medical and dental: $______________

14. Necessary insurance: $______________

15. Transportation: $______________

16. Dependent care: $______________

17. Required child support / 

spousal support: $______________

18. Federal student loan payments: $______________

19. Private student loan payments: $______________

20. Other expenses: $______________

Describe: ____________________________________

21. Total Monthly Expenses: $______________ 

(Sum of items 9 through 20)
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Borrower Name ________________________________ Borrower SSN: ___ ___ ___ - ___ ___ - ___ ___ ___ ___

SECTION 3: FAMILY SIZE, ADJUSTED GROSS INCOME, AND SPOUSAL IDENTIFICATION

Before completing this section, carefully read the entire form, including the instructions and definitions in Sections 5, 

6, and 7.

1. Your family size: ____________

(Note: Your family size includes you, your spouse, and your children (including unborn children who will be born before the end 

of the calendar year), if the children will receive more than half their support from you. Your family size includes other people 

only if they live with you now, receive more than half their support from you now, and will continue to receive this support from 

you for the year for which you are certifying your family size. Support includes money, gifts, loans, housing, food, clothes, car, 

medical and dental care, and payment of college costs.)

2. Adjusted Gross Income (AGI) amount reported on your most recent IRS tax filing: $___________[Optional]

(Note: AGI is used to determine a reasonable and affordable rehabilitation payment amount using the 15 percent formula. You 

have the option to report AGI on this form in case you decide to accept the monthly payment amount determined using the 15 

percent formula, rather than the monthly payment amount determined using the income and expense information you

provided on this form. If you choose the payment amount determined using the 15 percent formula, you will be required to 

submit documentation of your AGI to your loan holder.)

3. Spouse’s Name: _______________________________ 4. Spouse’s SSN: ___ ___ ___ - ___ ___ - ___ ___ ___ ___

(Note: Your spouse’s name and Social Security Number are only required if you are requesting rehabilitation of a Direct 

Consolidation Loan or Federal Consolidation Loan that was made jointly to you and your spouse )

SECTION 4: UNDERSTANDINGS, CERTIFICATIONS, AND AUTHORIZATION

Before completing this section, carefully read the entire form, including the instructions and definitions in Sections 5, 

6, and 7.

 I understand that: 

1. I have received this form because I requested the opportunity to rehabilitate my defaulted Direct Loan(s) and/or 

FFEL Program Loan(s) and objected to the reasonable and affordable monthly payment amount calculated using 

the 15 percent formula. 

2. My loan holder will calculate an alternative reasonable and affordable monthly payment amount that will be 

based solely on the information I provide on this form and, if requested, supporting documentation. 

3. If I do not accept the monthly payment amount calculated using either the 15 percent formula or based on the 

income and expenses information I provide on this form, the loan rehabilitation process cannot proceed and I 

will be required to repay my defaulted loans with payment amounts determined by my loan holder in 

accordance with the terms of the loan and applicable law. 

4. If I do not provide any supporting documentation requested by my loan holder by the deadline specified by my 

loan holder, my request for loan rehabilitation will not be considered any further. 

5. If I have a defaulted Direct Consolidation Loan or Federal Consolidation Loan that was made jointly to me and 

my spouse, both borrowers must request a reasonable and affordable payment rehabilitation payment 

determination, and our signatures below serve as that request.

6. If I previously rehabilitated a defaulted loan on or after August 14, 2008, I may not rehabilitate that same loan if 

I default on that loan again.

 I certify that: 

1. The information that I have provided on this form is true and correct. 

2. Upon request, I will provide additional documentation to my loan holder to support the information I have 

provided in this form.

 I authorize the loan holder to which I submit this request (and its agents or contractors) to contact me regarding my 

request or my loan(s), including repayment of my loan(s), at the number that I provide on this form or any future 

number that I provide for my cellular telephone or other wireless device using automated telephone dialing 

equipment or artificial or prerecorded voice or text messages.

Spouse’s Signature ____________________________________________________ Date _______________

(If you entered spousal identification information in Section 3)

Borrower Signature ____________________________________________________ Date _______________
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SECTION 5: INSTRUCTIONS

 If you are not completing this form electronically, 

type or print using dark ink. Enter dates as monthday-year (mm-dd-yyyy). Use only numbers. Example: 

January 31, 2013 = 01-31-2013. Include your name 

and account number(s) for your defaulted loan(s) on 

any documentation that you are required to submit 

with this form. If you need help completing this 

form, contact your loan holder(s).

Return the completed form to the address shown 

in Section 8.

 Monthly Income in Section 2 (Items 1 – 7).

Your loan holder(s) may request supporting 

documentation for any income items:

Employment income documentation may include a

pay stub or a letter from the employer stating the

income from that employer.

Child support, Social Security benefit, worker’s 

compensation or public assistance documentation 

may include copies of benefits checks or a benefits 

statement, a letter from a court, a governmental 

body, or the individual paying child support, 

specifying the amount of the benefit.

 Public assistance: Identify the type of public 

assistance received (See definition of “public 

assistance” in Section 6). 

 Other income: Include any other income not 

covered in items 1-6 and identify the source of the 

income.

 Monthly Expenses in Section 2 (Items 9-20). 

Your loan holder(s) may request supporting 

documentation for any of these items. Do not 

include a single expense in more than one category. 

If you have no expenses under a category, enter 0 

for that category.

 Food: Include the amount spent on food, even if 

purchased using the Supplemental Nutrition 

Assistance Program (SNAP) (food stamps).

 Housing: Include the amount spent on housing 

and shelter, such as rent, required security 

deposits, and mortgage payments (including 

principal, interest, taxes, and homeowner’s 

insurance).

 Utilities: Include the amount spent on housingrelated utility bills, such as gas, electric, water, 

sewer, trash, and recycling.

 Basic communication: Include the amount spent 

on basic communication expenses, such as basic 

telephone and internet expenses.

 Medical and dental: Include the amount spent on 

necessary medical and dental costs, such as 

medically necessary prescription and 

nonprescription medication, and medically 

necessary nutritional supplements. Do not 

include any costs relating to medical or dental 

insurance premium payments.

 Insurance: Include the amount spent on 

insurance, such as necessary renter’s, auto, 

medical, dental, or life insurance. Include any 

amounts paid toward insurance premiums, but do 

not include any amount that is deducted from 

your paycheck and reflected in the amount of 

income you listed under Monthly Income. 

Include homeowner’s insurance under Item 10

(Housing).

 Transportation: Include the amount spent on 

basic transportation expenses such as gas, car 

loans, basic vehicle maintenance, and public 

transportation.

 Dependent care: Include the amount spent on 

care for children or other dependents in the 

household and other work-related expenses.

 Legally required child support/spousal support

Include the amount spent on legally required 

child support and spousal support.

 Federal student loan payments: Include the total 

monthly amount paid on any federal student 

loan(s), except the defaulted loans you are trying 

to rehabilitate unless you are subject to 

mandatory withholding such as wage 

garnishment or Treasury offset (i.e., your Social 

Security is being garnished). If you are subject to 

wage garnishment or Treasury offset include the 

amount that is collected from you monthly. 

(Include the amount of any payment, voluntary or 

otherwise. 

 Private student loan payments: Include the total 

monthly amount paid on any private student 

loan(s). Include any type of payment, voluntary or 

otherwise.

 Other expenses: Include the amount spent on 

any other necessary expenses not covered in 

items 9 - 19 and explain these expenses. These

other expenses will be considered only if the 

Department of Education determines that they 

should be considered. 
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SECTION 6: DEFINITIONS

 The Federal Family Education Loan (FFEL)

Program includes Federal Stafford Loans (both

subsidized and unsubsidized), Federal PLUS 

Loans, Federal Consolidation Loans, and Federal

Supplemental Loans for Students (SLS).

 The William D. Ford Federal Direct Loan (Direct

Loan) Program includes Federal Direct

Stafford/Ford (Direct Subsidized) Loans, Federal

Direct Unsubsidized Stafford/Ford (Direct

Unsubsidized) Loans, Federal Direct PLUS (Direct

PLUS) Loans, and Federal Direct Consolidation

(Direct Consolidation) Loans.

 Rehabilitation of your defaulted loan occurs only

after you have made 9 voluntary, reasonable and 

affordable monthly payments within 20 days of 

the due date during 10 consecutive months and,

for FFEL loans, when the loan has been sold to an 

eligible lender. When you rehabilitate your loans,

you will regain all the benefits of the Direct Loan

Program or FFEL Program, including eligibility for

deferments or forbearances and eligibility for a

repayment plan with a monthly payment amount

based on your income. You will also regain

eligibility to receive additional Federal student

aid, including additional Federal student loans. 

After a defaulted loan is rehabilitated, your loan 

holder will instruct any consumer 

reporting agency to which the default was 

reported to remove the default from your credit 

history.

 Reasonable and affordable payment amount

means a monthly payment that is based either 

on the 15 percent formula or on information

provided in this form and supporting

documentation. It cannot be a percentage of

your total loan balance or based on information

unrelated to your total financial circumstances.

 The 15 percent formula means fifteen percent 

of the amount by which your Adjusted Gross 

Income exceeds 150% of the poverty guideline 

amount that is applicable to your family size 

and state, divided by 12. Your minimum

payment may not be less than $5.00.

 The loan holder of a defaulted Direct Loan

Program loan(s) is the U.S. Department of 

Education (the Department). The loan holder of a

defaulted FFEL Program loan(s) may be a guaranty

agency or the Department.

 Public assistance means payments you receive 

under a federal or state program. These 

assistance programs include, but are not 

limited to, Temporary Assistance for Needy 

Families (TANF), Supplemental Security Income 

(SSI), Food Stamps/Supplemental Nutritional 

Assistance Program (SNAP), or state general 

public assistance.

SECTION 7: LOAN REHABILITATION AGREEMENT

 To rehabilitate your loan, you must accept 

either the monthly rehabilitation payment 

amount determined using the 15 percent 

formula, or the amount determined based on 

the monthly income, monthly expenses, and 

family size information that you provide on this 

form and on any requested supporting 

documentation.

 Your loan holder will provide you with a written 

loan rehabilitation agreement confirming your 

monthly rehabilitation payment amount.

 To accept the loan rehabilitation agreement, 

you must sign the agreement and return it to 

your loan holder.

 During the loan rehabilitation period, the loan 

holder will limit contact with you on the loan 

being rehabilitated to collection activities that 

are required by law or regulation, and to 

communication that supports the rehabilitation.

 If you do not accept either monthly payment 

amount, your rehabilitation request will not be 

considered any further.

SECTION 8: WHERE TO SEND THE COMPLETED FINANCIAL DISCLOSURE FORM

Return the completed form and any required 

documentation to:

(If no address is shown, return to your loan servicer.)

If you need help completing this form, call:

(If no telephone number is shown, call your loan 

servicer.)
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SECTION 9: IMPORTANT NOTICES

Privacy Act Notice. The Privacy Act of 1974 (5 U.S.C. 552a)

requires that the following notice be provided to you:

The authorities for collecting the requested information

from and about you are §421 et seq. and §451 et seq. of

the Higher Education Act of 1965, as amended (20

U.S.C. 1071 et seq. and 20 U.S.C. 1087a et seq.) and the

authorities for collecting and using your Social Security

Number (SSN) are §§428B(f) and 484(a)(4) of the HEA 

(20 U.S.C. 1078-2(f) and 1091(a)(4)) and 31 U.S.C.

7701(b). Participating in the Federal Family Education

Loan (FFEL) Program or the William D. Ford Federal

Direct Loan (Direct Loan) Program and giving us your

SSN are voluntary, but you must provide the requested

information, including your SSN, to participate.

The principal purposes for collecting the information on

this form, including your SSN, are to verify your identity,

to determine your eligibility to receive a loan or a

benefit on a loan (such as a deferment, forbearance,

discharge, or forgiveness) under the FFEL and/or Direct

Loan Programs, to permit the servicing of your loan(s),

and, if it becomes necessary, to locate you and to

collect and report on your loan(s) if your loan(s)

becomes delinquent or defaults. We also use your SSN 

as an account identifier and to permit you to access

your account information electronically.

The information in your file may be disclosed, on a caseby-case basis or under a computer matching program, to

third parties as authorized under routine uses in the

appropriate systems of records notices. The routine uses

of this information include, but are not limited to, its

disclosure to federal, state, or local agencies, to private

parties such as relatives, present and former employers,

business and personal associates, to consumer reporting

agencies, to financial and educational institutions, and to

guaranty agencies in order to verify your identity, to

determine your eligibility to receive a loan or a benefit on

a loan, to permit the servicing or collection of your

loan(s), to enforce the terms of the loan(s), to investigate 

possible fraud and to verify compliance with federal

student financial aid program regulations, or to locate you

if you become delinquent in your loan payments or if you

default. To provide default rate calculations, disclosures

may be made to guaranty agencies, to financial and

educational institutions, or to state agencies. To provide

financial aid history information, disclosures may be made

to educational institutions. To assist program 

administrators with tracking refunds and cancellations,

disclosures may be made to guaranty agencies, to

financial and educational institutions, or to federal or

state agencies. To provide a standardized method for

educational institutions to efficiently submit student

enrollment statuses, disclosures may be made to guaranty

agencies or to financial and educational institutions. To

counsel you in repayment efforts, disclosures may be

made to guaranty agencies, to financial and educational

institutions, or to federal, state, or local agencies.

In the event of litigation, we may send records to the

Department of Justice, a court, adjudicative body,

counsel, party, or witness if the disclosure is relevant and

necessary to the litigation. If this information, either

alone or with other information, indicates a potential

violation of law, we may send it to the appropriate

authority for action. We may send information to

members of Congress if you ask them to help you with

federal student aid questions. In circumstances involving

employment complaints, grievances, or disciplinary 

actions, we may disclose relevant records to adjudicate or

investigate the issues. If provided for by a collective

bargaining agreement, we may disclose records to a labor

organization recognized under 5 U.S.C. Chapter 71.

Disclosures may be made to our contractors for the

purpose of performing any programmatic function that

requires disclosure of records. Before making any such

disclosure, we will require the contractor to maintain

Privacy Act safeguards. Disclosures may also be made to

qualified researchers under Privacy Act safeguards.

Paperwork Reduction Notice. According to the

Paperwork Reduction Act of 1995, no persons are

required to respond to a collection of information unless

such collection displays a valid OMB control number.

Public reporting burden for this collection of information

is estimated to average 1.0 hours (60 minutes) per

response, including the time for reviewing instructions,

searching existing data resources, gathering and

maintaining the data needed, and completing and

reviewing the information collection. The 

obligation to respond to this collection is required to

obtain a benefit in accordance with 34 CFR 682.405 or

685.211. Send comments regarding the burden

estimate(s) or any other aspect of this collection of 

information, including suggestions for reducing this

burden to the U.S. Department of Education, 400

Maryland Avenue, SW, Washington, DC 20210-4537 or email ICDocketMgr@ed.gov and reference OMB Control

Number 1845-0120. Note: Please do not return the

completed form to this address.

If you have questions regarding the status of your

individual submission of this form, contact your loan

holder (see Section 8).