UNCF ICB ACCREDITATION AND STUDENT LOAN DEBT MANAGEMENT INSTITUTE DEFAULT PREVENTION BEST PRACTICES PRESENTED BY ANTONIO HOLLOWAY (HUSTON-TILLOTSON) AND VALENTINO BRYANT (SHAW UNIVERSITY)

What is Default? Failure to repay a loan according to the terms and conditions agreed upon when the borrower signed the Master Promissory Note. Default occurs when the borrower becomes 360 days delinquent with payments The consequences to the borrower and the institution are severe.

Consequences of Default for Schools High Cohort Default Rates can- Negatively reflect school quality Result in Provisional Certification Result in loss of Title IV eligibility Minimize access to Private Loans

Seven Reasons Students Default Entered Military Service Low Wages / Income Trouble With Personal Relationships Unemployed High Medical Bills Married Someone With High Student Loan Debt Lack of Knowledge

What Huston-Tillotson University Have Implemented to Lower Default Rates (In-School Efforts) Enhanced Entrance Counseling Provide Financial Literacy and Scholarship Workshops Complete in-school deferment forms for prior loans Explain Satisfactory Academic Progress (SAP) Encourage students to pay accrued interest while in school Require Financial Literacy for all freshmen and transfers In-person exit interview for official withdrawals

Withdrawn Students Efforts Encourage student to re-enroll Implement a withdrawal process where student must see a retention officer In-person exit interview for official withdrawals Mail exit package to unofficial withdrawals Use servicer to mail grace letters Use servicer to contact borrowers that withdraw and become delinquent on loans

Grad Student Efforts Require in-person exit counseling for graduates Require financial literacy for graduates Use servicer to mail grace letters Use servicer to contact graduates that become delinquent on student loans Provide institution contact information to all graduates

Partner With External Agencies Collaborate with outside agency on writing a default prevention plan (TG assist Huston-Tillotson) Seek grant opportunities to help defray the costs for equipment, workshops, and additional employees, etc. (Huston-Tillotson received $100, from USA Funds)

What Shaw University Have Implemented to Lower Default Rates 2009: 30.2% 2010: 19%

Three Phase Approach “Where Are We?” and “How Did We Get Here?” Strategic Implementation Operation Default Rate Reduction Creation of Default Prevention / Retention Committee

“Where Are We?” and “How Did We Get Here?” We worked with the Office of Strategic Planning Institutional Research & Effectiveness (OSPIRE)  Based on year Draft Rate (23.1%)  233 Student Defaulted  183 Withdrawals  49% Freshmen; 29% Sophomore; 13% Junior; 14% Seniors and 1% Grad Students Low Retention Rate = High Default Rate and High Retention Rate = Low Default Rate

Creation of Default Prevention/Retention Committee Default Prevention Financial AidAdmission First Year Program OSPIRE Academic Success Vice President of Student and Academic Affairs Creates across-the- institution “BUY-IN” Ensures default prevention goals and plans are met Helps justify additional resources if needed Analyze data, resources and current practices

Stopping the Monument Adjusted two staff members work hours Monthly phone Blitz (one night a month all FA counselors stay late to make calls to delinquent borrowers) Mass mailing via USPS and s Social Media Strategic Implementation Operation Default Rate Reduction: Phase I

Student Outreach Faculty/Staff Outreach New Student Orientation  Breakout sessions for parents and incoming freshmen Early Alert System  During Freshmen Orientation, students complete an online survey, which allows the university to identify potential At-Risk Students Monthly Newsletters Financial Literacy Workshops Implementation of USA Funds Life Skills Development of Student Peer Financial Literacy Mentors Monthly Newsletters Attend Faculty Meetings once per semester  To promote Default Awareness Partnered with some faculty members who allowed us to participate in their class discussions about Financial Literacy Strategic Implementation; Phase II: Financial Literacy/Awareness

Contact Information Valentino Bryant Shaw University Default Prevention Administrator Antonio Holloway Huston-Tillotson University Director Financial Aid