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ICRAS and OMB Number: (1980.01) 1845-NEW2. v.1 Revised: 07/10/2013

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SUPPORTING STATEMENT

FOR PAPERWORK REDUCTION ACT SUBMISSION

FEDERAL DIRECT LOAN PROGRAM REGULATIONS for FORBEARANCE AND 

LOAN REHABILITATION

A. Justification 

1. Explain the circumstances that make the collection of information necessary. Identify any

legal or administrative requirements that necessitate the collection. Attach a hard copy of the 

appropriate section of each statute and regulation mandating or authorizing the collection of 

information, or you may provide a valid URL link or paste the applicable section1. Specify the 

review type of the collection (new, revision, extension, reinstatement with change, reinstatement 

without change). If revised, briefly specify the changes. If a rulemaking is involved, make note 

of the sections or changed sections, if applicable.

The Department is requesting a new information collection. The proposed Direct Loan 

(DL) Program regulations revise the current regulations for program administration as 

described below. The proposed regulations make changes in the provisions related to 

forbearance, reasonable and affordable loans rehabilitation and administrative wage 

garnishment along with the associated changes in burden. These changes are a result of 

the Student Aid and Fiscal Responsibility (SAFRA) Act that was included in the Health 

Care and Reconciliation Act of 2010 (HCERA), which as of July 1, 2010 and require a 

change in the current burden hours.

2. Indicate how, by whom, and for what purpose the information is to be used. Except for a new 

collection, indicate the actual use the agency has made of the information received from the 

current collection.

These changes to the regulations expand the collection of information in the Direct Loan 

Program. The proposed regulations provide for requests from a borrower for forbearance 

by exercising an option to orally acknowledge their Direct Loan debt and agree to repay

that debt. In addition, under the proposed reasonable and affordable provisions, when the 

amount of the monthly repayment amount is established the borrower may object to that 

amount and may subsequently have to provide documentation that supports their 

objection. Borrowers who have a change in financial circumstances would be able to 

provide documentation that supports their change in financial condition to the 

Department.

3. Describe whether, and to what extent, the collection of information involves the use of 

automated, electronic, mechanical, or other technological collection techniques or forms of 

information technology, e.g. permitting electronic submission of responses, and the basis for the 

 

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Please limit pasted text to no longer than 3 paragraphs.
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ICRAS and OMB Number: (1980.01) 1845-NEW2. v.1 Revised: 07/10/2013

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decision of adopting this means of collection. Also describe any consideration given to using 

technology to reduce burden.

Under the proposed regulations, these processes would be available via 

telecommunications devices and entail the submission of documents that support the 

objection or changing financial circumstances of the borrower. These provisions do not 

exclude the use of Web-based transmission of data, however most borrowers are making 

copies of supporting documents and mailing them to the Department. 

4. Describe efforts to identify duplication. Show specifically why any similar information 

already available cannot be used or modified for use for the purposes described in Item 2 above.

The current requirements are minimal and avoid duplication. There is no similar 

information available that can be used or modified for this purpose at this time.

5. If the collection of information impacts small businesses or other small entities, describe any

methods used to minimize burden. A small entity may be (1) a small business which is deemed 

to be one that is independently owned and operated and that is not dominant in its field of 

operation; (2) a small organization that is any not-for-profit enterprise that is independently

owned and operated and is not dominant in its field; or (3) a small government jurisdiction, 

which is a government of a city, county, town, township, school district, or special district with a 

population of less than 50,000.

No small businesses are affected by this information collection.

6. Describe the consequences to Federal program or policy activities if the collection is not 

conducted or is conducted less frequently, as well as any technical or legal obstacles to reducing 

burden.

These proposed Direct Loan regulatory changes provide for added flexibility for 

borrowers. Without these changes borrowers would not have access to a statutory benefit.

7. Explain any special circumstances that would cause an information collection to be conducted 

in a manner:

 requiring respondents to report information to the agency more often than quarterly;

 requiring respondents to prepare a written response to a collection of information in 

fewer than 30 days after receipt of it;

 requiring respondents to submit more than an original and two copies of any document;

 requiring respondents to retain records, other than health, medical, government contract, 

grant-in-aid, or tax records for more than three years;

 in connection with a statistical survey, that is not designed to produce valid and reliable 

results than can be generalized to the universe of study;

 requiring the use of a statistical data classification that has not been reviewed and 

approved by OMB;
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ICRAS and OMB Number: (1980.01) 1845-NEW2. v.1 Revised: 07/10/2013

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 that includes a pledge of confidentiality that is not supported by authority established in 

statute or regulation, that is not supported by disclosure and data security policies that are 

consistent with the pledge, or that unnecessarily impedes sharing of data with other 

agencies for compatible confidential use; or

 requiring respondents to submit proprietary trade secrets, or other confidential 

information unless the agency can demonstrate that it has instituted procedures to protect 

the information’s confidentiality to the extent permitted by law.

The collection of this information will continue to be conducted in a manner that is 

consistent with the guidelines in 5 CFR 1320.6.

8. As applicable, state that the Department has published the 60 and 30 Federal Register notices 

as required by 5 CFR 1320.8(d), soliciting comments on the information collection prior to 

submission to OMB. Summarize public comments received in response to that notice and 

describe actions taken by the agency in response to these comments. Specifically address 

comments received on cost and hour burden.

Describe efforts to consult with persons outside the agency to obtain their views on the 

availability of data, frequency of collection, the clarity of instruction and record keeping, 

disclosure, or reporting format (if any), and on the data elements to be recorded, disclosed, or 

reported.

Consultation with representatives of those from whom information is to be obtained or those 

who must compile records should occur at least once every 3 years – even if the collection of 

information activity is the same as in prior periods. There may be circumstances that may

preclude consultation in a specific situation. These circumstances should be explained.

These proposed regulations were developed through the Negotiated Rulemaking process 

where the public provided its input and in consultation with schools, and a variety of 

professional associations and other interested parties. The comment period for the 

burden associated with these proposed regulations will run concurrently with the 

comment period for the proposed regulations. Although OMB has up to 60 days to 

approve the ICR, it is recommended that the public comment on the ICR within the 30 

days of the regulations publication.

9. Explain any decision to provide any payment or gift to respondents, other than remuneration 

of contractors or grantees with meaningful justification.

No payments or gifts will be provided to the respondents.

10. Describe any assurance of confidentiality provided to respondents and the basis for the 

assurance in statute, regulation, or agency policy. If personally identifiable information (PII) is 

being collected, a Privacy Act statement should be included on the instrument. Please provide a 

citation for the Systems of Record Notice and the date a Privacy Impact Assessment was 

completed as indicated on the IC Data Form. A confidentiality statement with a legal citation that 
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authorizes the pledge of confidentiality should be provided.2If the collection is subject to the 

Privacy Act, the Privacy Act statement is deemed sufficient with respect to confidentiality. If 

there is no expectation of confidentiality, simply state that the Department makes no pledge 

about the confidentially of the data.

The Department makes no pledge about the confidentially of the data.

11. Provide additional justification for any questions of a sensitive nature, such as sexual 

behavior and attitudes, religious beliefs, and other matters that are commonly considered private. 

The justification should include the reasons why the agency considers the questions necessary, 

the specific uses to be made of the information, the explanation to be given to persons from 

whom the information is requested, and any steps to be taken to obtain their consent.

The Department is not requesting any sensitive data.

12. Provide estimates of the hour burden of the collection of information. The statement should:

 Indicate the number of respondents by affected public type (federal government, 

individuals or households, private sector – businesses or other for-profit, private 

sector – not-for-profit institutions, farms, state, local or tribal governments), 

frequency of response, annual hour burden, and an explanation of how the burden was 

estimated, including identification of burden type: recordkeeping, reporting or third 

party disclosure. All narrative should be included in item 12. Unless directed to do 

so, agencies should not conduct special surveys to obtain information on which to 

base hour burden estimates. Consultation with a sample (fewer than 10) of potential 

respondents is desirable. If the hour burden on respondents is expected to vary widely 

because of differences in activity, size, or complexity, show the range of estimated 

hour burden, and explain the reasons for the variance. Generally, estimates should 

not include burden hours for customary and usual business practices.

 If this request for approval covers more than one form, provide separate hour burden 

estimates for each form and aggregate the hour burdens in the ROCIS IC Burden 

Analysis Table. (The table should at minimum include Respondent types, IC activity, 

Respondent and Responses, Hours/Response, and Total Hours)

 Provide estimates of annualized cost to respondents of the hour burdens for 

collections of information, identifying and using appropriate wage rate categories. 

The cost of contracting out or paying outside parties for information collection 

activities should not be included here. Instead, this cost should be included in Item 

14.

 

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Requests for this information are in accordance with the following ED and OMB policies: Privacy Act of 1974, 

OMB Circular A-108 – Privacy Act Implementation – Guidelines and Responsibilities, OMB Circular A-130 

Appendix I – Federal Agency Responsibilities for Maintaining Records About Individuals, OMB M-03-22 – OMB 

Guidance for Implementing the Privacy Provisions of the E-Government Act of 2002, OMB M-06-15 –

Safeguarding Personally Identifiable Information, OM:6-104 – Privacy Act of 1974 (Collection, Use and Protection 

of Personally Identifiable Information)
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ICRAS and OMB Number: (1980.01) 1845-NEW2. v.1 Revised: 07/10/2013

RIN Number: 1840-AD12 

Section 685.205 – Forbearance:

 The proposed regulations amend the current Direct Loan regulations to authorize 

the Secretary to grant forbearance to a borrower or endorser who is in default on a loan, 

but prior to the loan being transferred to collections, based on the borrower’s or 

endorser’s oral request. The proposed regulations provide that a forbearance agreement 

in this situation must include a new agreement to repay the debt signed by the borrower 

or endorser (as required under the current regulations), or a written or oral affirmation of 

the borrower’s or endorser’s obligation to repay the debt. The proposed regulations 

define “affirmation” for this purpose to be an acknowledgment of the loan by the 

borrower or endorser in a legally binding manner that can take the form of: 1) a new 

signed repayment agreement or schedule, or another form of signed agreement to repay

the debt (as under current regulations), or 2) an oral acknowledgment and agreement to 

repay the debt that is documented by the Secretary in the borrower’s or endorser’s file 

and confirmed by the Secretary in a notice to the borrower; or 3) a payment made on the 

loan by the borrower or endorser. The proposed regulations also specify that if a 

forbearance in this situation is based on the borrower’s or endorser’s oral request and 

affirmation, the Secretary must orally review with the borrower the terms and conditions 

of the forbearance, and that the Secretary must send the borrower or endorser a notice that 

confirms the terms of the forbearance and the borrower’s or endorser’s affirmation of the 

obligation to repay the debt within 30 days of that agreement. The proposed regulations 

require the Secretary to retain a record of the terms and conditions of the forbearance and 

affirmation in the borrower’s or endorser’s file. 

For the 2011 calendar year, 62,905 Direct Loan borrowers requested forbearance 

after defaulting on a loan. Of that number, we estimate that 25 percent (15,726 

borrowers) would have exercised an option to orally acknowledge the debt and agree to 

repay the debt. On average, we estimate that it would take a borrower 0.17 hours (10 

minutes) per oral acknowledgment to listen to the list of terms and conditions of the 

forbearance as they are reviewed with the borrower. The burden associated with the 

completion of the General Forbearance Request form, OMB 1845-0031, is estimated to 

average 0.2 hours (12 minutes). Therefore, the net reduction in burden to provide an oral 

acknowledgement rather than complete the form is the difference of the two or 0.03 hours 

(0.20 hours minus 0.17 hours or 2 minutes) per oral forbearance.

We estimate that burden would decrease by 472 hours (15,726 borrowers 

multiplied by 0.03 hours per oral forbearance) under OMB Control Number 1845-NEW2.

Section 685.205 – New Burden:

# of Respondents # of Responses Hours/Response Burden Hours

15,726 15,726 .03 - 472
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Section 685.211(f)(3) – Reasonable and affordable loan rehabilitation:

The proposed regulations would add new §685.211(f)(3) requiring the Secretary

to base determinations of reasonable and affordable rehabilitation payment amounts of 

defaulted loans on information provided on an OMB-approved form, and, if requested, 

supporting documentation. 

 

We estimate that 11,144 Direct Loan borrowers will raise an objection to the 

initial amount of the reasonable and affordable loan rehabilitation amount. We estimate 

that each objection will entail a phone conversation or e-mail that would span on average 

.17 hours (10 minutes). This would increase burden to the borrowers for a total of 1,894 

hours (11,144 borrowers objecting to the initial reasonable and affordable amount 

multiplied by .17 hours per loan rehabilitation request) under OMB Control Number 

1845-NEW2.

Section 685.211(f)(3) – New Burden:

# of Respondents # of Responses Hours/Response Burden Hours

11,144 11,144 .17 1,894

Section 685.211(f)(5) –Reasonable and affordable loan rehabilitation:

 Proposed §685.211(f)(5) would require a borrower who objects to the monthly

repayment amount contained in the written repayment agreement to provide the Secretary

the documentation needed to calculate a monthly payment amount under the incomebased repayment plan formula. If the borrower does not provide this information to the 

Secretary, no rehabilitation agreement would exist with the borrower, and the Secretary

would not proceed with the rehabilitation. 

Of the 92,870 Direct Loan borrowers in calendar year 2011 that requested loan 

rehabilitation of their default loans, we estimate that 12 percent or 11,144 borrowers 

would need to submit documentation for a monthly payment plan under the income-based 

repayment plan formula to be calculated. We estimate that on average each borrower 

would take .33 hours (20 minutes) to collect, copy, and submit the required 

documentation. We estimate that burden would increase by 3,678 hours (11,144 

borrowers required to submit documentation multiplied by .33 hours per loan 

rehabilitation request) under OMB Control Number 1845-NEW2.

Section 685.211(f)(5) – New Burden:

# of Respondents # of Responses Hours/Response Burden Hours

11,144 11,144 .33 3,678

Section 685.211(f)(7) – Reasonable and affordable:
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Proposed §685.211(f)(7) would require the Secretary to, upon request of a 

borrower, adjust the borrower’s monthly rehabilitation payment due to a change in the 

borrower’s financial circumstances. The borrower would be required to provide 

documentation supporting the request. 

We estimate that 10 percent of Direct Loan borrowers who are rehabilitating their 

default loans (9,287 Direct Loan borrowers) would have a change in their financial 

circumstances in the initial year the proposed regulation is implemented. We estimate 

that on average each borrower would take .33 hours (20 minutes) to collect, copy, and 

submit the required documentation. We estimate that burden would increase by 3,065 

hours (9,287 borrowers with changes in financial circumstances multiplied by 0.33 hours 

per loan rehabilitation request equals 3,065 hours) under OMB Control Number 1845-

NEW2.

Section 685.211(f)(7) – New Burden:

# of Respondents # of Responses Hours/Response Burden Hours

9,287 9,287 .33 3,065

Total Current Inventory:

# of Respondents # of Responses Burden Hours

 -0- -0- -0-

Revised Inventory:

# of Respondents # of Responses Burden Hours

 47,301 47,301 8,165

13. Provide an estimate of the total annual cost burden to respondents or record keepers 

resulting from the collection of information. (Do not include the cost of any hour burden 

shown in Items 12 and 14.)

 The cost estimate should be split into two components: (a) a total capital and start-up cost 

component (annualized over its expected useful life); and (b) a total operation and 

maintenance and purchase of services component. The estimates should take into account 

costs associated with generating, maintaining, and disclosing or providing the 

information. Include descriptions of methods used to estimate major cost factors 

including system and technology acquisition, expected useful life of capital equipment, 

the discount rate(s), and the time period over which costs will be incurred. Capital and 

start-up costs include, among other items, preparations for collecting information such as 

purchasing computers and software; monitoring, sampling, drilling and testing 

equipment; and acquiring and maintaining record storage facilities.

 If cost estimates are expected to vary widely, agencies should present ranges of cost 

burdens and explain the reasons for the variance. The cost of contracting out information 
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collection services should be a part of this cost burden estimate. In developing cost 

burden estimates, agencies may consult with a sample of respondents (fewer than 10), 

utilize the 60-day pre-OMB submission public comment process and use existing 

economic or regulatory impact analysis associated with the rulemaking containing the 

information collection, as appropriate.

 Generally, estimates should not include purchases of equipment or services, or portions 

thereof, made: (1) prior to October 1, 1995, (2) to achieve regulatory compliance with 

requirements not associated with the information collection, (3) for reasons other than to 

provide information or keep records for the government or (4) as part of customary and 

usual business or private practices. Also, these estimates should not include the hourly

costs (i.e., the monetization of the hours) captured above in Item 12

Total Annualized Capital/Startup Cost : 

Total Annual Costs (O&M) : 

____________________

Total Annualized Costs Requested : 

There are no capital/startup costs to respondents, nor are there any annual costs to 

respondents associated with operating or maintaining systems or purchasing services.

14. Provide estimates of annualized cost to the Federal government. Also, provide a description 

of the method used to estimate cost, which should include quantification of hours, operational 

expenses (such as equipment, overhead, printing, and support staff), and any other expense that 

would not have been incurred without this collection of information. Agencies also may

aggregate cost estimates from Items 12, 13, and 14 in a single table.

The cost to the federal government is minimal. This minimal cost estimate is in part due 

to the fact that current servicer contracts include phone counseling to borrowers, 

therefore the addition of oral affirmation of a debt does not represent a substantive 

increase in cost.

15. Explain the reasons for any program changes or adjustments. Generally, adjustments in 

burden result from re-estimating burden and/or from economic phenomenon outside of an 

agency’s control (e.g., correcting a burden estimate or an organic increase in the size of the 

reporting universe). Program changes result from a deliberate action that materially changes a 

collection of information and generally are result of new statute or an agency action (e.g., 

changing a form, revising regulations, redefining the respondent universe, etc.). Burden changes 

should be disaggregated by type of change (i.e., adjustment, program change due to new statute, 

and/or program change due to agency discretion), type of collection (new, revision, extension, 

reinstatement with change, reinstatement without change) and include totals for changes in 

burden hours, responses and costs (if applicable).

The Department is requesting approval of this Direct Loan information collection under 

OMB 1845-NEW2 to reflect the program changes in the proposed regulatory changes. 

These changes provide additional flexibilities for Direct Loan borrowers and permit oral 
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requests for forbearance, as well as allow a borrower to object to the initially established 

reasonable and affordable loan repayment amount. In addition, if a borrower incurs 

changes to his or her financial circumstances, the borrower can provide supporting 

documentation to change the amount of the reasonable and affordable loan monthly

repayment amount.

16. For collections of information whose results will be published, outline plans for tabulation 

and publication. Address any complex analytical techniques that will be used. Provide the time 

schedule for the entire project, including beginning and ending dates of the collection of 

information, completion of report, publication dates, and other actions.

The results of this collection of information will not be published.

17. If seeking approval to not display the expiration date for OMB approval of the information 

collection, explain the reasons that display would be inappropriate.

The Department is not seeking this approval.

18. Explain each exception to the certification statement identified in the Certification of 

Paperwork Reduction Act.

The Department is not requesting any exceptions to the “Certification for Paperwork 

Reduction Act Submissions” of OMB Form 83-1.