"Y"	=	The	borrower	is	in	default	on	a	Title	IV	loan.
"E"	=	Unable	to	determine	if	the	borrower	is	in	default	on	a	Title	IV	loan.
If	the	result	is	"N,"	a	student	or	parent	Direct	PLUS	Loan	applicant	who	meets	all	other	Direct	PLUS	Loan	eligibility
requirements	may	receive	a	Direct	PLUS	Loan.
If	the	result	is	"Y,"	the	student	or	parent	may	not	receive	a	Direct	PLUS	Loan	(or	any	other	
Title	IV	aid)	until	the	default
status	is	resolved	(see	"Resolving	Default	Status"	in	Volume	1,	Chapter	3	for	more	information).
A	result	of	"E"	may	be	reported	if	for	some	reason	it	was	not	possible	to	conclusively	determine	that	the	applicant	is	not	in
default.	An	<E=	result	is	most	commonly	due	to	temporary	systems	issues	involving	the	interface	between	the	Direct	PLUS
Loan	Application	and	NSLDS.	In	this	case,	if	the	Direct	PLUS	Loan	applicant	is	a	graduate	or	professional	student	and	the
NSLDS	match	performed	by	the	FPS	indicates	that	the	student	is	not	in	default,	you	may	rely	on	the	results	of	that	check.
If	the	applicant	is	a	parent,	you	must	separately	check	NSLDS	to	confirm	that	the	parent	is	not	in	default	before
originating	a	Direct	PLUS	Loan.
Ineligible	Borrowers
The	Department	may	determine	that	a	borrower	was	ineligible	to	receive	a	Direct	Loan	if,	at	the	time	the	loan	was	made
and	without	the	knowledge	of	the	Department	or	the	school,	the	borrower	(or	the	dependent	student	on	whose	behalf	a
parent	received	a	Direct	PLUS	Loan)	provided	false	information,	was	convicted	of	or	pled	no	contest	or	guilty	to	a	crime
involving	fraud	in	obtaining	
Title	IV	funds,	or	took	actions	that	caused	the	borrower	or	student	to	receive:
Loan	funds	for	which	they	were	wholly	or	partially	ineligible;
Interest	benefits	on	a	loan	for	which	they	were	ineligible;	or
Loan	funds	for	a	period	of	enrollment	for	which	they	were	ineligible.
If	the	Department	determines	that	a	Direct	Loan	borrower	was	ineligible,	the	Department	sends	the	borrower	a	demand
letter	that	requires	the	borrower	to	repay	some	or	all	of	the	loan	the	borrower	received,	as	applicable,	within	30	days.	If
the	borrower	fails	to	comply	with	the	letter,	the	borrower	is	considered	in	default	on	the	entire	loan.
IMPORTANT:	If	you	do	not	require	Direct	PLUS	Loan	applicants	at	your	school	to	complete	the	Direct	PLUS	Loan
Application,	you	must	check	NSLDS	for	all	parent	Direct	PLUS	Loan	applicants	to	confirm	that	they	are	not	in
default	before	originating	Direct	PLUS	Loans	for	these	individuals.
Direct	PLUS	Loan	Application	NSLDS	Default	Check
October	18,	2016	Electronic	Announcement
Ineligible	Borrowers
34	CFR	685.211(e)
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