For those involved with your schools’ Default Management Efforts, ED released Draft cohort default rates for FY 2013 on Monday, February 29, 2016. Reviewing draft rates timely is crucial for being able to make certain types of data challenges, which can impact your Official Cohort Default Rates in September. Schools have 45 days to submit data challenges and appeals in the draft cycle.
This is perhaps the most important Draft Cycle to many schools because Official Rates which will be published later this year in September will carry sanctions for schools with three years of 3-year CDRs over 30%, for the first time. In other words, if your school’s CDR is over the threshold you’re going to want to look closely at the students included in your CDR and to make sure the calculations are accurate during the draft cycle because there are sanctions that go into effect for schools with high Cohort Default Rates.
If CDR is 30% or higher for three consecutive years:
- First year – Must form a default management prevention task force and submit default prevention plan to ED.
- Second consecutive year – Must evaluate and revise default prevention plan and re-submit to ED.
- Third consecutive year – School LOSES eligibility for federal student loans and Pell Grants.
At the time of publishing, FSA has acknowledged that some schools were sent CDR letters and/or CDR reports listing the incorrect cohort year. In an electronic announcement published late in the evening on February 29th, the Department has confirmed that they will redistribute the FY 2013 Draft Cohort Default Rates backup detail records to schools beginning on March 1, 2016. http://1.usa.gov/1QoAT1B
For more information on the release of the 2013-3 Year CDR click here: http://1.usa.gov/214lf0q