1. Responsible Borrowing Initiatives
Bob Collins, Western Governors University
JoEllen Soucier, Houston Community College
October 12, 2017
San Antonio, TX
Texas Association of Student Financial Aid Administrators

2. WGU Financial Aid Delivery Model
Monthly starts first day of every month
Academic year is 12 consecutive months
Two six-month payment periods (non-standard terms)
Tuition and fees (learning resources) = $3000
Fixed price: all you can learn for $6000/year
No tuition increase since 2008
Accelerate time-to-degree completion
Undergraduate average: 2.5 years to graduate
Texas Association of Student Financial Aid Administrators

3. Responsible Borrowing Initiatives ED Experimental sites
Unequal Loan Disbursements
WGU implemented July 2014 – ED sunset June 2016
Borrow only what is needed to pay costs when charges are incurred
Nursing College: Science Fee Teachers College: Demonstration Teaching Fee
Multiple disbursements required if payment period > 4.5 months
Need fix in HEA Reauthorization – section(s) 428 G and 455 (Direct Loans)
Limiting Unsubsidized Direct Loans
WGU implemented January 2013 – ED almost sunset June 2017
Restrict borrowing to direct costs only (tuition and fees)
Texas Association of Student Financial Aid Administrators

4. Limiting Unsubsidized Direct Loans - Selection Criteria
$30,000 Outstanding Principal Balance
(Avg. OPB: $43K)
Limited to $6,500 per Academic Year
Undergrad
Student
$40,000 Outstanding Principal Balance
(Avg. OPB: $62K)
Limited to $7,500 per Academic Year
Graduate Student
Texas Association of Student Financial Aid Administrators

5. Texas Association of Student Financial Aid Administrators

6. Help students make an informed decision, borrow wisely
My Financial Aid Plan
Modified CFPB Shopping Sheet (July 2013)
Personalized to student program of study and grade level
Recognizes annual/aggregate federal student loan limits
Direct (tuition) vs Indirect (living allowances) costs
Custom recommendation: borrow only unmet direct costs
Help students make an informed decision, borrow wisely
Texas Association of Student Financial Aid Administrators

7. My Financial Aid Plan
Behavioral economics: how small changes in decision framing can have significant, positive impacts From July 2013 – June 2016, average borrowing per student went from $7,870 per year to $4,640 per year, a 41% reduction
Texas Association of Student Financial Aid Administrators

8. Do you want to be awarded federal student loans?
Accept Recommended Loans
Decline all loans
I want less than recommended
I want more than recommended
65%
10% 3%
22%
Texas Association of Student Financial Aid Administrators

9. Texas Association of Student Financial Aid Administrators

10. Institutional impact Cohort default rates (3 year – FY2014)
Texas Association of Student Financial Aid Administrators

11. Student Loan Scenario Calculator
Impressive Results, Next Iteration:
Need more fluid process, develop gaming technology
Full visibility of total student loan debt & estimated monthly payments
Informed decision at time of action (i.e. requesting loan amount)
Encourage interest only in-school payments on unsubsidized loans
Texas Association of Student Financial Aid Administrators

12. Texas Association of Student Financial Aid Administrators

13. Texas Association of Student Financial Aid Administrators

14. Texas Association of Student Financial Aid Administrators

15. Texas Association of Student Financial Aid Administrators

16. Leadership / Collaboration / Strategic Partnerships
Outsource – partner with SaaS provider (Campus Logic)
Allow WGU to focus on its core mission to improve quality of and expand access to postsecondary education
Develop and deliver My FA Plan – July 2013 through June 2016
Insource – impressive results, need more fluid process ( ?)
Allow WGU to focus on its mission of affordability
Develop, deliver, continually enhance Student Loan Scenario calculator
No more amplifiers of problem ($1.4 trillion student debt)
Need more communicators of solutions
Texas Association of Student Financial Aid Administrators

17. Replicability / Scalability / Sustainability
WGU has proof of concept
RBI can be adopted and adapted to meet demographic needs
Borrow only what you need, not the maximum allowable
Presentations at numerous professional associations
College affordability
Texas Higher Education Coordinating Board
Tennessee College Affordability public forum
Public policy agencies, NGO’s, NFP organizations, elected officials
Texas Association of Student Financial Aid Administrators

18. Topic Point 1 Point 2 Point 3
Texas Association of Student Financial Aid Administrators

19. Topic Point 1 Point 2 Point 3
Texas Association of Student Financial Aid Administrators

20. Help students make an informed decision, borrow wisely. Thank you!
Bob Collins –
Contact Information for Presenters