Default Prevention
Kathie S. Aswegan / Allen CollegeTristan Lynn / AIBNickNeuendorf/ Kirkwood CCJennifer Schroeder / Iowa State UniversityIASFAA Spring 2014 Conference
Why? It may be required.
Required for schools using DL for the 1sttime.34 CFR 668.14 (b)(15)Required for schools using DL & have had a change in ownership.34 CFR 668.14 (b)(15)Required for schools with a default rate of 30% or higher.34 CFR 668.217
Why? You may be interested
If you aren’t interested in CDR, you should be.Improve student successSave tax dollarsIt’s strongly encouraged by D. E. (Gen-05-14)It’s the right thing to do for students!!
Who?
Team approachDefault prevention is not only the responsibility of the financial aid office.Increase ideasSuggested members: financial aid, admissions, registrar, student services, bursar/BO, academic advising
What to do next?
Educate the teamCDR – current and historical% of students receiving financial aid% of students graduating with debtAverage debtWho is defaulting?
Evaluate your current activities
What are you currently doing on your campus that may or may not have an impact on your default rate?Entrance counselingExit counselingTimely enrollment reporting to NSLDSSAP. Do you share information across your campus?
What else could we do?
Analyze default informationDelinquent borrower follow upAdditional attention/follow up to students who withdrawReminder notice during grace periodAdditional in school counselingDefaulted borrower out reach & encourage loan rehabilitationFinancial Literacy…
Financial Literacy…Budgeting, Borrowing, & Repayment
BudgetingBorrowingRepayment
A Financial Literacy program should include these elements
Create a plan
Create a unique plan based on your data.What are other schools doing?ED’s sample default prevention & management planwww.ifap.ed.gov/qahome/qaassessments/defaultmanagement.htmlIf you have questions, contact [email protected]
What’s next?
Communicate your plan across campus.Implement 1 item at a time.Collect data about activities and the number of students served, etc..
U.S. D.E. Tools
StudentAid.govBudgetingBorrowingRepaymentNational Student Loan Data System as a tool for both schools and studentshttp://www.nslds.ed.gov/Financial Awareness Counseling Tool (FACT)http://studentaid.ed.gov/about/announcements/factDirect Loan Repayment Estimatorhttps://studentloans.gov/myDirectLoan/counselingInstruc
Panel member information
Tristan Lynn, Director of Financial AidAIB College of [email protected] 3yr CDR 12.2% (46 students)2011 3yr draft CDR 7.9% (31 Students)Current activities:Monthly delinquency report from NSLDS, 100 day or less, letter and phone call immediately, 365 days or less, letter every 3 monthsLetter contains information on default and prevention methods along with Economic Hardships and Unemployment Deferment request forms.Currently evaluating data of defaulted students to determine characteristics and develop strategy to educate while they are still students.
Panel member information
NickNeuendorf, Financial Aid AdvisorKirkwood Community [email protected] 3yr CDR 15% (606 students)2010 3yr CDR 22.9% (1,061 students)2011 3yr draft CDR 24.6% (1,448 students)Current Activities:·OutreachProgram(Communicate with former students & graduates to educate them on current options with their federal student loans) We use the NSLDS Delinquent Borrower Report to contact our delinquent borrowers on a monthly basis1) Early Stage Delinquent Borrowers (30 – 120 days delinquent) –Receive friendly reminder emailevery90 days2) Mid Stage Delinquent Borrowers (121-240 days delinquent) –Receive a more urgent emailevery 60days3) Late Stage Delinquent Borrowers (241-360 days delinquent) –Receive a very serious email every30days, ifnoemail on file, then we send a letter. We also call this group every 30days·FinancialLiteracy Program(Communicate with the current student population to increase financial literacy so they are better prepared to manage student loans upon graduation)Studentsactivating an Unsubsidized Stafford Loan must complete Financial Awareness Counseling throughwww.studentloans.govin order to receive the UNSUB loanFinancialLiteracy 101 Presentation (presented to our traditional students in their 1stsemester on campus enrolled in the College 101 course)Educates students on the financial aid process, creating a budget, repaying student loans, using credit cards responsibly, monitoring your credit report
Panel member information
Jennifer Schroeder, Student Loan CounselorIowa State [email protected] 3yr CDR 5.4% (253 students)2011 3yr draftCDR5.1% (263students)Current Activities:90-120 days delinquent, sending letter informing student of their delinquent status, service contact information, and options to rectify the delinquency.Encouraging more in person exit counseling sessions.Currently looking into ways to inform students while in school about servicer information, and encourage them to set up an online account with their servicer prior to graduation.
Panelists will tell you more.Question & Answer
A big thank you to all the panelist for baring their souls for all of us today!!!!
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