Although our process is designed to be as accurate as possible, there are instances in which the funds we send to payoff a loan are insufficient to satisfy the outstanding balance or are in excess of the current outstanding balance. We have designed the processes below to ensure that "Underpayments" and "Overpayments" are processed timely. Do not return the original payoff check issued by the Consolidation Department if there is an underpayment or overpayment associated with the loan.

Underpayments

If the Consolidation Department’s payment does not satisfy the account balance, use one or more of the following options to send all requests for insufficient funds:

Loan Holders Enrolled in Electronic Return Funds Service: Submit your Payment Adjustment Manifest by logging on to Electronic Payoff and Return Funds Services Online and proceed to the Online Manifest Selection web page section to submit your request. Loan holders enrolled in the EFT Payoff Service will receive underpayments in the next transmission cycle (transmission cycles occur twice a week).

Loan Holder Not Enrolled in Electronic Return Funds Service: Mail your organization’s request to the following address:

U.S. Department of Education
Consolidation Department
P.O. Box 210069
Montgomery, AL 36102-0069

Please include in your underpayment request the name, SSN, account number and the first disbursement date OR the original payoff check number for the borrower for whom funds are being requested. In addition, please include the amount of principal, interest, and any collection costs or late fees that may be applicable. This information will help to ensure you receive prompt, accurate payments.

In most cases, these requests can be completed within five business days from the date the request is received. Payments will be sent by check through the U.S. Mail.

Non-EFT participants will receive their underpayments by check if they are a Private Loan Holder or interagency transfers if they are an Agency.

Overpayments

If the Consolidation Department’s payment does not satisfy the account balance, use one or more of the following options to send all excess funds:

Loan Holders Enrolled in Electronic Return Funds Service: Return overpayment funds to the Consolidation Department through ACH. In addition, submit your Payment Adjustment Manifest that corresponds to the EFT Return Funds ACH payment, online through the web site. Please note that the ACH transaction must include the Payment Adjustment Manifest Number to insure that the Consolidation Department can properly match payments to submitted manifests.

Loan Holder Not Enrolled in Electronic Return Funds Service: Mail a check(s) for the excess funds to the address listed below. Submit your Payment Adjustment Manifest that corresponds to your payment online through the web site or mail it along with the check(s). Please note that your check must include the Payment Adjustment Manifest Number to insure that the Consolidation Department can properly match your check to the submitted manifest.

U.S. Department of Education
Consolidation Department
P.O. Box 210069
Montgomery, AL 36102-0069

Regardless of whether you are sending individual checks or a single check with a Payment Adjustment Manifest, please be sure to include the borrowers’ names, SSNs, loan account numbers, and the first disbursement date OR the original check     number(s) for the borrower for whom funds are being returned. In addition, please include the amount of principal, interest, and any collection costs or late fees that may be applicable. This information will help to ensure that the borrower's account is credited promptly.

In most cases, these refunds can be completed within 72 hours from the date the excess cash is received.