From: Ralph, Judith C (JRalph@otterbein.edu)
Date: Wed Jan 08 2003 - 13:06:54 EST
It's a murky issue at best. My reponses are in CAPS.
Judy Ralph
Student Accts Manager
Otterbein College
Westerville, Ohio
<<The Department of Education does not dictate how we should handle refunds
related to Parent PLUS Loans. They have told us that it is up to the
individual school how they handle these refunds, but that the school must
have a written policy. We are looking at changing our current policy and
would like to have some input as to how other schools handle these.
1) Do you always offer PLUS Loan refunds directly to the parent, or directly
to the student? IF THE STUDENT'S OTHER AID WAS IN PLACE FIRST AND THE PLUS
LOAN IS WHAT CREATED THE OVERPAYMENT ON THE ACCOUNT, THEN WE REFUND TO THE
PARENT. THE PARENTS USUALLY USE THE PLUS AS A REPLACEMENT FOR THEIR
EXPECTED CONTRIBUTION, SO UNLESS WE KNOWN SOMETHING DIFFERENT ABOUT THEIR
SITUATION, WE REFUND TO THEM.
2) Do you require permission from the parent to disburse the refund to the
student? YES. WE ACTUALLY PREFER THEM TO CALL US AND WE DOCUMENT THAT
BECAUSE STUDENTS HAVE BEEN KNOWN TO FORGE NOTES FROM THEIR PARENTS. IT'S A
SMALL PERCENTAGE THAT EVER TRY, AND THERE'S NO FOOLPROOF WAY TO BE
ABSOLUTELY CERTAIN THAT THE NOTE/LETTER/PHONE CALL IS ACTUALLY THE PARENT'S
REQUEST. I DO REQUIRE THAT ANY LETTERS OR NOTES INCLUDE A NUMBER WHERE I
CAN REACH THE PARENT TO CONFIRM. IT'S NOT WORTH TRYING TO MATCH SIGNATURES.
IF I'M THE LEAST BIT SUSPICIOUS, I CALL THE PARENT MYSELF. ONCE THE STUDENT
KNOWS THAT I WON'T HESITATE TO CALL THE PARENT BEFORE I'LL RELEASE A REFUND
TO HIM/HER, THAT USUALLY ENDS ANY ATTEMPT TO TRY SOMETHING FUNNY. I'VE HAD
PARENTS THANK ME FOR VERIFYING THE REQUEST WITH THEM. WE USUALLY GET THE
"FUNNY BUSINESS" REQUESTS AT SPRING BREAK TIME OR WHEN OUR LOCAL CAR STEREO
OUTLET HAS A BIG SALE! ;-)
3) Do you require the student's permission to disburse the refund to the
parent? NO - WE ONLY DISBURSE TO THE PARENT IF THE PLUS ACTUALLY CREATES THE
CREDIT BALANCE.
4) If the PLUS loan is not the only method of payment, what are your
guidelines to determine if the overpayment is from the PLUS Loan?
WE APPLY ANY LOCAL, INSTITUTIONAL, STATE OR FEDERAL GRANTS AND SCHOLARSHIPS
TO THE CHARGES FIRST, THEN STAFFORD LOANS AND FINALLY, THE PLUS. WE FIND
THAT PARENTS TEND TO APPLY FOR THE PLUS AFTER THE OTHER FORMS OF AID, SO
IT'S USUALLY NOT A PROBLEM.
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