Direct Loan Closeout Deadline for 2024-25 Award Year

---

Print
Posted Date March 18, 2026 Author Federal Student Aid Electronic Announcement ID DL-26-01 Subject Direct Loan Closeout Information for 2024–25 Award Year

The William D. Ford Federal Direct Loan (Direct Loan) Program **** data submission (closeout) deadline for the 2024–25 award year is Friday, July 31, 2026. We must receive and accept all school data by this date in order for it to be included in the school’s final ending cash balance for the year.

Note: We may make exceptions to the established closeout deadline on a case-by-case basis if the school’s processing period extends beyond the deadline. Schools in this category should contact the FSA Partner and School Relations Center at the number provided below for more help. After the closeout deadline has passed, a school may request relief from the deadline via the “Request Reopen/Extended Processing” function on the Common Origination and Disbursement (COD) website.

As a reminder, all cash management, disbursement reporting, and monthly reconciliation regulatory requirements supersede the closeout deadline. For schools meeting these regulatory requirements, the final closeout stage should begin no later than the last award end date (also known as the loan period end date) at the school for a given program and year. Each school should complete reconciliation to a zero-ending cash balance and close out soon after its final disbursements. Schools should not wait until the closeout deadline.

To be considered successfully closed out, a school must

• have an ending cash balance of $0 and total net unbooked disbursements of $0 both internally and as reflected on the School Account Statement (SAS) and
• complete the “School Balance Confirmation” form on the COD website.

As part of the closeout process, we will send “Zero Balance” or “Remaining Balance” notifications via email. In early May 2026, we will email a “Notification Warning” letter to the financial aid administrator (FAA) and president at each school that has not confirmed closeout on the COD website, including schools with a zero balance that have not confirmed closeout. This letter serves as a reminder to finish processing and confirm closeout before the established data submission closeout deadline.

After the closeout deadline, we will notify schools of any remaining balances through the “Post-Closeout Deadline Multi-Year Balance Reminder” letter sent via email and will conduct outreach by COD reconciliation coordinators and the School Reconciliation Branch. This outreach may result in the school receiving a “Combined Programs Demand” letter or “Negative Balance” letter. Any remaining positive balance will result in a final liability for the school.

A school must be aware of its closeout status even if its Direct Loan processing is handled by a third-party servicer. We encourage each school to communicate regularly with their third-party servicer to ensure closeout is completed. It is each school’s responsibility to monitor its balances to ensure that it finishes processing and confirms closeout on time.

Staying on top of the process is essential for achieving successful reconciliation and closeout. Schools should complete the important steps below.

• Perform required monthly reconciliation:

  • Internal reconciliation - Compare internal student accounts and business office or bursar records with financial aid office records. If your school uses a third-party servicer, you also should ensure that your internal and servicer records match.
  • External reconciliation - Compare internal records to your Direct Loan SAS sent via your Student Aid Internet Gateway (SAIG) mailbox.
  • Resolve any discrepancies and document outstanding timing issues.

• Verify that all drawdowns and refunds of cash are applied to the correct program and award year.

• Send all batches to the COD System and import all responses once they are accepted.

• Resolve all outstanding rejected records and ensure that all disbursements and adjustments are accurately reflected.

• Review all pending disbursements and determine whether these need to be reported as actuals (Disbursement Release Indicator (DRI) = True). If not, reduce these to $0.

• Return all refunds of cash electronically via G5.

• Request any remaining funds if supported by actual disbursement data.
  Contact Information

We appreciate your cooperation as we work to close out the Direct Loan Program for the 2024–25 award year. If you have questions about this announcement or need help with closeout, contact the FSA Partner and School Relations Center at 1-800-848-0978. The contact center is open from 10 a.m. to 6 p.m. Eastern time, Monday through Friday. You may also email CODSupport@ed.gov.

Questions and Answers

Q1: When should a school confirm Direct Loan closeout for the 2024–25 award year?

A1: A school should be able to confirm closeout within a month or two of submitting its final actual disbursements, but no later than the established data submission closeout deadline of July 31, 2026. If your school needs to process actual disbursement data after the established processing closeout deadline, refer to Q6 for more information.

Note: As a reminder, cash management, disbursement reporting (including adjustments to disbursements), and monthly reconciliation requirements supersede the closeout deadline. If a school is meeting these regulatory requirements, a school should be able to reconcile to a zero-ending cash balance soon after its final disbursements. If the school has completed processing and resolved known issues, the school should confirm closeout at that time. Schools should not wait until the closeout deadline.

Q2: When a school successfully completes the school balance confirmation process and closes out a Direct Loan award year on the COD website, are there subsequent actions that occur?

A2: Yes. Based on a school’s successful balance confirmation for the award year, the following actions will occur:

1. We will send a "Program Year Closeout" letter to the school’s president and FAA.
2. The COD website will reject award or disbursement changes per published edits.
3. We will reduce the school's current funding level (CFL) to the greater of net drawdowns or net accepted and posted disbursements.
4. We will reduce remaining anticipated disbursements to zero, adjust all award amounts to equal the sum of actual disbursements, adjust loan period dates so that all zero-dollar disbursements are outside the loan period, and recalculate subsidized usage for each borrower.
5. We will no longer send the SAS and other reports for this award year and program

Q3: Can a school delay closeout activity based on the possibility of future processing needs?

A3: Schools should not delay closeout activities based on transactions that might occur later. If a school has completed all known cash and disbursement activity in the award year, the school must complete their reconciliation to a zero-ending cash balance and confirm closeout, as indicated in Q1.

Delays should occur only if a school has identified specific additional transactions that it needs to report or correct immediately. These can include, but are not limited to,

• eligible late disbursements,
• downward disbursement adjustments due to changes in student enrollment or eligibility, and
• unclaimed credit balances needing to be refunded. Schools should report these changes in a timely manner, per regulatory requirements, to complete final reconciliation and closeout.

Q4: What are the benefits to confirming closeout within a month or two of submitting final disbursement data?

A4: The benefits to confirming closeout include the following:

• We send the school a "Program Year Closeout" letter to be included with its final reconciliation documentation. This letter confirms the date the school officially closed out the award year.
• No additional monthly reconciliation to the SAS is required unless the school’s disbursement or cash balances change (see Q8 for more details).
• Tighter controls over available funds in G5. With the closeout confirmation process, a school’s CFL is reduced to the greater of net drawdowns or net accepted and posted disbursements, which prevents further funds being requested or received for the closed year. This also prevents the school from making an accidental drawdown of funds in the wrong award year when a new award year is added.
• Tighter controls over submitting disbursement or award level changes per published edits. Anticipated disbursements are reduced to $0 during the closeout confirmation process, and edits are enforced for any future increases. Schools should review new or increased disbursement and award data closely to ensure compliance with regulatory requirements before requesting to be reopened or placed on extended processing.
• We discontinue year-specific reports to reduce clutter in the school’s SAIG mailbox and keep student data from being sent unnecessarily.
• Changes to cash and/or disbursement balances after a school has confirmed closeout (i.e., downward disbursement adjustments, refund of cash, or a drawdown adjustment) trigger a “Reopen Change” letter via email to notify the school that a change in balance has occurred and that the school should research and resolve the balance. This helps the school monitor when changes occur late in the award year so that reconciliation efforts can resume and the school can reconfirm closeout.
• We email a “Reopen Change” or “Extended Processing” letter to the president and FAA as notification that the school was reopened or placed on extended processing due to a request made by the school or by a change in balance. If the school receives one of these notifications, the school is no longer considered closed out and the school must resume reconciliation and reconfirm closeout.

Note: Any change in balance requires a school to resume reconciliation to fulfill its monthly reconciliation requirements and reconfirm closeout.

Q5: How does a school close out the Direct Loan Program for the award year?

A5: After a school completes a final reconciliation of its internal financial aid and business office records to its Direct Loan SAS, reflecting a zero-ending cash balance, the school must go to the COD website and complete the “School Balance Confirmation” form. This can be found under the “School” link in the blue tool bar along the top of the main page and the “Balance Confirmation” link on the left-hand tool bar under “School Information.”

Q6: What if a school has actual disbursements scheduled past the closeout deadline?

A6: We may make exceptions to the last processing day of the award year on a case-by-case basis if a school’s processing period extends beyond the closeout deadline and the school needs to report new or increased award or disbursement amounts. Before the closeout deadline, schools in this category should contact the FSA Partner and School Relations Center at CODSupport@ed.gov for more help. After the closeout deadline has passed, schools must request extended processing directly through the COD website (refer to Q10 for more information).

Q7: What happens if a school confirms closeout before the established closeout deadline but has additional records to report to the COD website?

A7: Before the closeout deadline, if a school identifies new awards, new disbursements, or upward disbursement adjustments that it needs to submit after completing the balance confirmation process, the school can request to be reopened via the “Request Reopen/Extended Processing” page on the COD website (refer to Q10 for more information). After we process the request, the school can start processing immediately.

If a school identifies downward adjustments to disbursements and non-financial changes that it needs to submit, the school does not need to request to be reopened. If we accept the downward adjustments records, we will automatically reopen the school.

We will no longer consider the school confirmed as closed out and will send the school a “Reopen Change” letter. The email will be sent to the FAA and president. The school must resume reconciliation and reconfirm closeout.

Q8: What if a school’s balance changes after it confirms close out?

A8: If a school’s balance changes due to downward disbursement adjustments, refunds of cash, or adjustments in G5, we will email the school a “Reopen Change” letter and send the school an updated SAS at the end of the month.

We will automatically reopen the school and no longer consider it closed out if the balance change occurs before the closeout deadline.

If the balance change occurs after the closeout deadline, the school can request extended processing to submit new awards, new disbursements, or upward adjustments to awards or disbursements only to resolve the balance. The school does not need extended processing to process downward adjustments to disbursements or report non-financial changes (refer to Q10 for more information), or to request or refund cash through G5.

The school must reconcile to a zero balance and complete the closeout confirmation process again.

Q9: What happens after the closeout deadline?

A9: After the closeout deadline, we

• reduce the CFL to the greater of net drawdowns or net accepted and posted disbursements for all remaining open schools;
• reject award year-specific Direct Loan awards and disbursements per established edits;
• discontinue year-specific Direct Loan reports;
• discontinue year-specific “Zero Balance” and “Remaining Balance” emails; and
• issue a final Direct Loan SAS to all schools, using school SAS options.

Q10: What if a school needs to submit student award or disbursement data to the COD website after the established closeout deadline?

A10: Extended processing is not needed to submit decreases to award or disbursement amounts or any non-financial changes. If you need to submit increases to award or disbursement amounts or new award or disbursements after the closeout deadline, you will need to request an extension to the deadline via the COD website’s “Request Reopen/Extended Processing” page. Do not submit a request until after you have completed reconciliation of all program records and are ready to submit increases or new award or disbursement data to the COD System. Extended processing is available on a case-by-case basis.

After the data submission deadline, extended processing is not needed for

• downward award changes;
• downward disbursement adjustments (reductions to actual disbursements);
• non-financial changes; and
• upward changes due to Pell Overaward Process (POP).

After the data submission deadline, extended processing is needed for

• increases to awards;
• upward disbursement adjustments (increases to actual disbursements); and
• new disbursements.

To request extended processing, log in to the COD website and complete the following steps:

1. Go to the “School Summary Information” screen by selecting the “School” tab on the top blue bar and entering your school identifier information.
2. Select the “Request Reopen/Extended Processing” link located on the left-hand tool bar under “School Information.”
3. Complete all required fields, including choosing the reason for the request from the drop-down menu and providing a detailed description of the problem. Do not include personally identifiable information in this field (i.e., Social Security numbers, award identifiers, etc.). The “Help” link in the upper right corner has additional information to assist you in filling out the form.
4. Select the “Submit” button below the data fields.

If your extended processing request is authorized, your president and FAA will receive an email which includes the extended processing expiration date. You can also view this notification on the “School Correspondence” page on the COD website. If we need additional information to support the request, we will send an email to the requestor. If the necessary information is not provided or if extended processing is not needed (e.g., the request was made in error), your request will be denied.

Tip: A school can also see the status of their extended processing on FSA Partner Connect. From the “School Profile” page, select the “School Options and General Information” link, choose the applicable award year and program, and expand the “Extended Processing Status” section for more information.

In addition, please note the following:

• An extension to the closeout deadline does not negate any other data reporting deadline, student eligibility or disbursement requirements pertaining to the Title IV programs, nor does it imply we approve the school’s failure to meet the established closeout deadline.
• Before seeking relief from the closeout deadline, the school should review its records and consult with the FSA Partner and School Relations Center, if necessary. If we grant extended processing, the school should know precisely what data it needs to submit and how to submit it to the COD website, so that the school’s records are accurate at the end of the extension period.
• A school on Heightened Cash Monitoring 2 (HCM2) must coordinate with its FSA Payment Analyst if the school finds it still needs to submit data after the established closeout deadline. The Payment Analyst will contact the appropriate FSA staff on the school's behalf with an appropriate extension period for processing.

Q11: What if a school does not resolve its ending cash balance?

A11: We will notify the school of its remaining balance through the “Combined Programs Closeout” letter process conducted two times a year, for new and existing positive and negative balances. Any remaining positive balance will result in a final liability for the school.

Q12: What tools are available to assist schools with Direct Loan reconciliation and closeout?

A12: There are various tools that a school can use to externally reconcile the cash and disbursement data from the COD website. The following tools are available:

Reports

• Direct Loan SAS – We provide a SAS to all schools each month. The SAS is similar to a bank statement and provides the official ending cash balance as of the end of the reported month, as well as detailed cash and loan or disbursement detail transactions for the reported period. The SAS is the school’s primary tool for reconciliation and closeout and should be compared to both financial aid and business office records. Tip: Schools can choose to update SAS options at the end of their processing period to receive year-to-date detail data for final reconciliation activities, even if they routinely receive monthly data as their default.

Additional information on the content and available formats for the SAS is available in the COD Technical Reference, Volume 6, Section 7: COD Reports.
- Direct Loan SAS Disbursement Detail on Demand – This ad-hoc report provides SAS disbursement detail data independent of the school’s monthly SAS file.
- Direct Loan SAS Disbursement Detail on Demand Report Reader and Instructions – This tool formats the fixed length SAS Disbursement Detail on Demand Report into an Excel spreadsheet. It is found under “COD Resources” at the bottom of any COD website page.
- Pending Disbursement List Report – This report contains disbursements not yet funded in the COD website (DRI = False).

COD Website

• School Funding Information (found under the “School” link in the blue tool bar along the top of the main page and the “Funding Info” link on the left-hand tool bar under “School Information”)
• School Summary Financial Information (found under the “School” link in the blue tool bar along the top of the main page and the “Summary Financial Info” link on the left-hand tool bar under “School Information”)
• Cash Activity (found under the “School” link in the blue tool bar along the top of the main page and the “Cash Activity” link on the left-hand tool bar under “School Information”) – Cash Activity shows all individual drawdowns, refund of cash, and other transactions. This information is sent to the COD website from G5 and can be used to reconcile internal bank statements and cash transactions.
• Anticipated Disbursement Queue (found under the “Batch” link in the blue tool bar along the top of the main page and the “Anticip Disb Queue” link on the left-hand tool bar) – The Anticipated Disbursement Queue lists all anticipated (pending) disbursements and is updated daily. It can be used to determine whether anticipated disbursements need to be canceled (reduced to zero) or made into actual disbursements (DRI = True).
• Action Queue (found under the “Batch” link in the blue tool bar along the top of the main page and the “Action Queue” link on the left-hand tool bar) – The Action Queue lists records that are in review by FSA’s Payment Analysts for a school on HCM2. It can be used by the school to ensure it has sent all records to the COD website that it intends to submit in its HCM2 submission.

FSA Partner Connect

• School Dashboard – **** On the dashboard, the section “Origination and Disbursement Notifications” can alert a school about areas that need immediate attention, such as unsubstantiated cash > 30 days, unresolved balances in closed award years, and balance confirmations needed.
• School Financial Information – **** This page contains sections that are similar to the financial pages on the COD website but with enhanced features. Important sections include the “School Daily SAS Cash Information,” “School Funding Information,” “Cash Activity,” and “Refunds of Cash Information.”
• School Profile, School Options and General Information – This page contains sections with information on extended processing status and your SAS report selections.

Software

• EDExpress – This software compares cash and disbursement data from EDExpress or a school’s custom software and/or website to the cash and disbursement data from the SAS and produces a discrepancy report. For more information, refer to the COD Technical Reference, Volume 3 (refer to Q13 for more information).

Q13: Where can schools find additional resources for closeout and reconciliation?

A13: Additional resources include:

• FSA Handbook - Volume 4, Chapter 6 – Reconciliation in the Direct Loan Program
• COD Technical Reference, Volume 3 – Combination System Supplement
• COD Technical Reference, Volume 6, Section 7 – COD Reports
• COD Reconciliation Coordinators (contact FSA Partner and School Relations Center at 1-800-848-0978)