Mark C. Walsh | Dec U.S. Department of Education Student Loan Servicing Summit Borrower Outreach and Communications

Communications Volume Million Placed 21 Million Received 286 Million Telephone Calls

Communications Volume Million Sent 1 Million Received 754 Million s/Letters

Outreach Timeline 4 MilestoneCommunication FocusExamples of Outreach In School-Get acquainted with your servicer -Create an online account -Maintain valid contact information -Financial Literacy -Keep track of your loans -Make smart decisions - Welcome Packets - Welcome s and Introductory Materials -Quarterly Interest Notices -Loan Summary Details -Periodic and Consistent Financial Literacy Info In Grace-Preparing for repayment -Understanding your options -Repayment Option Details -Early Awareness Reminders In Repayment-Repayment options and flexibility -Work with your servicer (establish trust) -Borrower benefit details & making repayment simple and convenient -Monthly and annual statements / Notices -Segmented or targeted scenario based communications (such as prompting for Direct Debit or tailored Public Service Loan Forgiveness info) In Delinquency-Income-Driven Repayment -Repayment & Postponement options -Consolidation or Extended Term -Targeted delinquency and other campaigns -Delinquency Notices Successful Repayment- Closure of the loan debt-Paid in Full or Consolidation Notices -Discharge or Forgiveness Confirmation

Critical Communication Stages In School In Delinquency In Repayment In Grace 5 In Default

Critical Communication Stages 6 Communications Entrance and Exit Counseling FSA new borrower letter introduces servicer Servicer welcome letter and packet Additional communications include self-service features, balance, interest, entering grace Saving for college Creating a budget Managing personal finances Establishing good credit Servicer/FSA financial literacy site links Avoiding over-borrowing Identity theft Wise use of credit cards Career search tips Repayment calculator tools Financial literacy In School

FSA Campaign – Financial Literacy FSA launched a three week joint mini-campaign with the loan servicers to address predatory practices of third-party debt relief companies. This campaign began on Sept Combat These Ads

Critical Communication Stages 8 FSA Campaigns In-Grace borrowers were the most responsive to FSA’s 2014 campaign. Two s per year will go out containing information about repayment options Borrowers That Have Withdrawn/Left School – Focus on IBR options that can provide a lower monthly payment with a goal of allowing this group to begin or re- enter a repayment status Preparing for Repayment Maintain the relationship with the borrower Ensure correct repayment status Update and enhance contact information Promote self-service through the web Financial literacy continues Correspondence: Countdown to repayment In Grace

Critical Communication Stages Communication Methods Payment Vehicles Online Regular telephone Smart phone Mail Auto-pay Income-Driven Repayment Proactive campaigns Re-disclosure statements and regular correspondence FSA IDR campaigns Inbound/Outbound calls Servicer and FSA websites Text messaging Bills Delinquency letters/ s Mail inserts Responding to written communications Social media 9 In Repayment

FSA Campaign - Repayment Marketing Objective: Increase awareness of repayment options Key Messages: Find the best repayment plan for you Estimate your monthly payments You may qualify to make payments based on your income If you’re having trouble making payments, we can help You don’t need to pay for services related to your student loans Target Audience: Recent College Graduates and Borrowers Timing: Spring: 5/1/2014–6/30/2014 Fall: 10/15/14–12/15/14 10

FSA Campaign - Repayment October 15 – December 15, 2014 Sample posts from Halloween 11

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Critical Communication Stages FSA Campaigns “Getting Back on Track” s 60 and 240 day delinquency letters Social Media campaigns Borrowers who missed their first payment Text messages Calling campaigns Skip-trace activity Assigning borrowers to individual staff members Servicer Outreach Activities Creative correspondence s Website banners Working with schools Personal visits to borrowers 13 In Delinquency

Critical Communication Stages Facts and activities Final Demand Letter sent at 241 days Default occurs at 270 days All servicers continue attempts to reach the borrower up to 360 days of delinquency Notice of Default sent by FSA’s Default Resolution Group 14 FSA Campaign Defaulted Borrowers with Low Balances <$4,000 Communication will focus on the small amount of money per month it will take to rehabilitate their loans, re-enter a repayment status, and start to repair their credit In Default

FSA Campaign – Borrowers At-Risk s sent to 3.34 million borrowers (3.15 million successful) CALL TO ACTION COHORT Apply for an income-driven repayment (IDR) plan days delinquent Apply for an IDR plan days delinquent Visit the repayment estimator Owe more than $50K and entered repayment in the last year Visit the repayment estimator In deferment or forbearance for reasons of financial hardship or unemployment Visit the repayment estimator In grace period and owe more than $25K Contact their servicer to apply for an IDR plan Greater than 270 days delinquent 15

FSA Campaign Results Opened Logged in to studentloans.gov Accessed the repayment estimator or IDR application Applied for IDR 30% 17% 10% 7% 16

Improving Borrower Communications Servicers utilize the following: FSA Quarterly Surveys Servicer’s own survey process Social media comments Open rates Success rates (response to calls for action) Feedback from schools Focus groups (internal/borrowers) 17

Improving Borrower Communications Servicer Quality Control Initial and update training Scripts or talking points provided Repository of information maintained Supervisory review and coaching Regular call monitoring 18 FSA Quality Control Call monitoring Call Center statistics and analysis Account monitoring and review Weekly Servicer Liaison touchpoint meetings On-site reviews

Communications Enhancements 19 Website redesigns Adding new links Text messaging Payment plan comparisons Web chat Personalized s Billing reminders Unique delinquency campaigns Special features for the military Enhanced communications while in school and during grace IDR hotline and webpages Pre-filled forms for convenience Borrower newsletters New website videos Special phone lines for delinquent borrowers New voice messaging to make deferment requests easier In-house borrower surveys Ability for borrowers to manage their accounts online 24/7

Plans for the Future Servicer initiatives Easy navigation from mobile devices (phone, tablet, laptop) Web redesign Increased “self-service” opportunities Promoting social media to schools Enhanced financial literacy materials for borrowers Staff dedicated to service member counseling Unique new ideas to reach delinquent borrowers Online scheduling of a call with a counselor 24/7 Post-call borrower customer service surveys 20

QUESTIONS? 21