Department of Education Announces Plans to Develop Direct Loan Common Manual
By Jill Desjean, Director of Policy Analysis
On Monday the Department of Education (ED) announced plans via the Federal Register to create a Common Manual for Direct Loans. ED is seeking public feedback by October 8, 2025 to inform this effort.
The notice states ED’s goal is to, “complement the current performance-based contracts and is aimed at establishing a set of clear, concise, consistent, and enforceable federal standards for the operations and oversight of the Direct Loan Program, drawing lessons from the Common Manual model used for the Federal Family Education Loan (FFEL) Program.”
NASFAA has long advocated for a Direct Loan Common Manual, which has existed in the FFEL program for nearly 30 years.
The Government Accountability Office (GAO) published a report on FSA’s management of contractors, including student loan servicers, in 2015. A section of the report titled “Lack of FSA Guidance and Instructions to Servicers Results in Inconsistent and Inefficient Services to Borrowers,” highlights issues with how ED provides guidance to its loan servicers, citing a lack of clarity and consistency, among other concerns. This can lead to different interpretations of guidance by different servicers and leave borrowers with disparate treatment based on the servicer they have been assigned to. A Common Manual could potentially mitigate some or all of these issues.
NASFAA is interested in member feedback on how ED should proceed with developing the Direct Loan Common Manual. Please share your thoughts by emailing [email protected], including the preferred format of the manual, challenges you face administering Direct Loans that should be addressed in the Common Manual, and anything else you feel is relevant. NASFAA will use this feedback to inform our comments.
Publication Date: 9/10/2025
Tessa J | 9/10/2025 10:28:11 AM
Why was the manual eliminated? Was it replaced by the FSA Handbook after FFELP ended?
Susan D | 9/10/2025 9:59:54 AM
Is the comment request for a comprehensive guide specific to loan servicing? Or is the comment request for a Direct Loan guide that FA administrators will use as a reference in administering Direct Loans to students?
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