MPN Confirmation is Needed
Mpn confirmation is necessary for subsequent loansA crucial step in multi-year use of the MPN is the confirmation process, which takes the place of the previous requirement that the borrower sign a new note for each academic year (in Direct Loans) or period of enrollment (in FFEL).Schools must develop and document a confirmation process to ensure that the borrower wants subsequent loans. FFEL schools must work with the lender. The confirmation process may be part of the required notices and disclosures that already exist, or it may be separate and supplement them. To ensure student control over the borrowing process, a student must accept, either actively or passively (i.e., through notification), the loan amount offered. Active MPN confirmationThe school does not disburse the loan until the borrower accepts the proposed loan type and amount or requests changes to the proposed loan package.Passive MPN confirmationIn this case, the school does not disburse the loan until the borrower is notified of the proposed loan package. (The notification can come from the school, lender, and/or guarantor.) The borrower only needs to take action if he or she wants to decline the loan or make adjustments to the type or amount of the loan.As an example, your school’s award letter may include proposed loan amounts and types. For active confirmation, the student would be asked to confirm the loan amount offered by responding to your school’s offer. For passive confirmation, the student would be asked to respond only if he or she wanted to cancel or reduce the loan amount offered.
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