In an announcement made last month in a post on the Department of Education’s Homeroom blog, Under Secretary of Education James Kvaal wrote that the agency was rescinding its guidance on third-party servicers.  Earlier this week, the Department made this move official by formally withdrawing its third-party servicer guidance through a Dear Colleague Letter (DCL).  

The letter outlined the new process in which the Department plans to issue a final revised DCL with an effective date at least six months after its publication.  

The DCL also rescinded prior guidance prohibiting contracts between colleges and foreign-owned or operated services.  However, the Department reserved the right to revisit that issue in the upcoming negotiated rulemaking process, which is expected to begin this fall.