If you have ever received a Federal Student Aid loan, then you know that you need to fill out a Master Promissory Note (MPN). The function of this note is in its name: it is your promise to pay back your loan principal plus interest. Some people may not realize that this is a federally-binding document, and putting false or unreliable information on it can have serious consequences. Most of the information that you need to fill out is self-explanatory. For example, your name, social security number, address, and phone number are all common fields you should have no problem filling out. However, choosing what references to use is a task that should take some careful analysis.
If you have ever applied for a job, chances are that you have had to include personal references with your resume. To fill out a MPN, you must have two credible references that you have known for at least three years. These references can be contacted by your loan servicer for a variety of reasons, but the most common reason your references will be contacted is if you enter into delinquency and/or default. Essentially, references should be able to vouch for your character, so it is important that you make wise decisions when choosing your references.
First and foremost, no matter which references you choose, you should always provide complete and accurate information on them. Remember, signing the MPN allows your references’ information to be shared with outside agencies, including your school, loan servicer, and the Department of Education (review the Borrower Request, Certifications, and Authorizations section before signing). If you cannot provide their full name, full address, phone number, and relation to you (email address is optional), then they should not be used as a reference. Since the MPN explicitly states that you need to have known your references for at least three years, you need to abide by this and only select those individuals you have known for that length of time. If you have numerous possibilities after taking these criteria into consideration, there are additional steps you can follow.
The MPN also explicitly states that your first reference should be a parent or guardian. If you are unable to provide a reference that fits that description, then you should use a reference who most closely resembles that description, such as a spouse, child, or grandparent. You should avoid using friends as references at all costs; rather, you should try to include family members, employers/co-workers, or advisors (pastors, teachers, etc.). It is extremely unprofessional to use reference types such as “boyfriend’s mom,” “best friend” and similar relations. All of these categories are references that loan servicers actually come across. Always try to use acceptable references; it will make you as a loan borrower look more credible.
By Ryan Laspina
Senior Specialist, Red Flags and External Reviews