Promoting Responsible Management of Educational Debt From Borrowing Wisely to Successful Repayment and Everything In Between

360º of Prevention Beyond mere default avoidance lies a more comprehensive approach.

Promoting Responsible Management of Educational Debt The causes and ramifications of default are widespread and long term so the solution must be wide-range and long term too: Perspective Responsibility Involvement Commitment Education This “PRICE” actually engenders many benefits in addition to default prevention.

Perspective-A Broad View WHO: Find out who would benefit & get them involved WHY: WIIFMs of promoting responsible debt management WHEN: Key times for promoting responsible behavior WHERE: Targeted locations for promoting responsibility WHAT: The causes of default reveal what improvements need to be made

Responsibility Require Responsible Behavior Enhance financial aid appointments Career development & financial literacy coursework Help students manage all educational debt Best long-term options per student situation Insist on cooperation of departments, students, loan servicers, other schools and government Other?

Reward Responsible Behavior Praise students for handling debt well Provide financial responsibility incentives Send positive comments to staff/supervisor Include positive remarks on evaluations Benefits to schools w/CDR under 15% (3yr) Other?

Consequences for Acting Irresponsibly Deny access to diplomas, official transcripts and re-admission to the school Notify supervisor & target for improvement if school staff not properly assisting students Comments on staff performance evaluations Report on DOE/servicer surveys Sanctions to schools with CDR over 30% (3yr) Other?

Involvement Include Everyone in the Solution Students & their family/friends Campus staff in all departments Loan Servicers U.S. Department of Education Other schools Other?

Commitment Promote Long Term Success Improve efforts on retention Accurate and timely enrollment reporting Support students on all educational debt Build relationships with loan servicers & collections agencies Contact students during the Grace Period Help in delinquency Assistance after default Other?

Accurate & Timely Enrollment Reporting School reporting directly to NSLDS enhances accuracy and timeliness of data Fix errors right away Clearinghouse helps Perkins Loan borrowers Schools & Perkins Servicers can receive enrollment data weekly from NSLDS

Support on All Educational Debt Debt from attending our school and other schools as well FSA loans (Direct, FFELP, Perkins) Overpayments of PELL/Loans Institutional loans State loans Debt owed directly to the Campus Other?

Build Relationships With Loan Servicers Get to know your regional/sector representative Fix errors immediately Provide updates on borrower info Attend webinars, use reports and other tools Use conference calls Provide feedback to improve performance Collections agencies Other?

Servicer School Line Fax Website Email for Schools Great Lakes (888) 686-6919 (800) 375-5288 mygreatlakes.org clientservices@glhec.org Navient (888) 272-4665 NON ED(800) 848-1949 ED (866) 266-0178 navient.com collegeserv@navient.com Nelnet (866) 463-5638 (866) 545-9196 nelnet.com ssc@nelnet.net Fedloan (800) 655-3813 (717) 720-1628 myfedloan.org schoolsupport@myfedloan.org DMCS (800) 621-3115 myeddebt.com https://www.myeddebt.com/borrower/loadEmailInquiryPage

Outreach During the Grace Period Exit Counseling Verify/update enrollment data & contact info Notify student of available school services School balance assistance Remind that repayment begins in 6 months for some loans & right away for others Provide servicer info Help get all debts in best arrangement possible Continuing/completing education Other? Provide servicer info

Monitor for Missed Payments Servicer Report Name Website Great Lakes Borrowers at Risk mygreatlakes.org Navient Past Due Loans – Ed Past Due Loans - Navient navient.com/schools/ Nelnet Core Borrower Level Data Report nelnetloanservicing.com/nsight/ Fedloan Loan Portfolio Summary-Delinquent myfedloan.org

Outreach to Delinquent Borrowers Utilize a variety of contact methods to reach delinquent borrowers Develop a plan to put the resources you have to best use If resources are scarce, emphasize focus where greatest results are likely Other? Total number of borrowers in the different stages of delinquency Missed 1st/2nd payment Early Stage Mid Stage Late Stage Staff availability, strengths and weaknesses Access to tools phones, email, paper, Computers, internet, skip-tracing

Cure Delinquency Gather information and assess situation Create short-term (immediate cure) Create long-term plan (future arrangements) Contact and enact plans with ALL educational debt holders/servicers Advocate for the borrower Update contact info Monitor debt status & follow-up as needed Document progress & modify strategy as needed

After Default Soft default or hard default Paying debt in full (default stays on credit record for 7 years) Loan consolidation (default stays on credit record for 7 years) Loan rehabilitation (9-10 months, but default is removed from credit record) Encourage appropriate decision making Assist with pursuing chosen option

Track CDR & Prepare Appeals Get the Portfolio Report monthly Monitor your changing total cohort # Keep track of who defaulted in each month (CDR Date of Default, Claim Reason-DF) Verify enrollment data, loan status, DER, grace, etc. to correct as needed & prepare for appeals Estimate your running CDR – Great Lakes’ Portfolio Navigator is helpful with this

Education Provide Everyone w/ Proper Education Proper debt management techniques Consequences of poor debt management WIIFMs of successful repayment Financial Literacy instruction Make sure school staff are good role models Appropriate Entrance & Exit Counseling Schools, servicers, DOE share best practices Other?

Provide Appropriate Tools Budgeting & understanding of interest accrual NSLDS Servicer information Help understanding the options & processes for optimal loan arrangement Access to telephone, printer, fax & internet access as needed Career & retention services Other?

Questions & More Best Practice Sharing Jennifer Hoepner Director of Alumni Support Herzing University jhoepner@herzing.edu (414) 271-5136