1. Problem Borrowers or Borrowers with problems?
How and why schools can help influence repayment success

2. Problem Borrowers or Borrowers with Problems?
Default Rates defined
Influencers
Effect and impact on your school
What you can do
Best practices

3. Expected Life Cycle of Loan Defaults

4. Current Rate (1%) – All Defaults/All Loans

5. Matured Loan Rate (4%) – All Defaults/Loans in Repay

6. Annual Rate (0.25%) – Annual Defaults/All Loans

7. Cohort Default Rate (5%) – 3 Year Snapshot

8. Ultimate Default Rate (10%) – All Projected Defaults/All Loans

9. Major Default Rate Influencers
Portfolio Development - passage of time
Student Demographics - Who are the borrowers
Underwriting Standards – credit scoring
Graduation/Withdrawal Rates – educational value
Servicing and Collections – marginal influence
Aggregate Borrowing – not always what you think

10. Impacts on a School Loan Availability – Elimination of access
Loan Pricing – Lower rates and fees
Reputation – proxy for quality
Recruitment – proxy for value
Retention – Family resources dry up

11. Impacts within a school
Admissions – access and pricing = enrollment
Bursar – Tuition and Fees get paid on time
Alumni – Happy donors
Financial Aid – Difficult job a bit easier
Administration – Proxy for institutional quality and value

12. What Can a Student Do? School Selection - Affordability
Apply for “free money” - unclaimed scholarships
Major - its potential earning power/loan amount
Post graduation living budget – realistic?
In-school Payments - 8% x 4 x $13,000 = $4,160 (PAYCE)
Employment and resume - help
Loan Modification - before it is a crisis!

13. What can a School Do?
Secure institutional attention - Why it is important.
Provide pre-acceptance counseling –what life will be
Develop a 4-year borrowing plan – coupled with salary
Identify high risk students - remedial work
Financial Literacy – BUDGETS!!!
Assist servicers - locate borrowers, but NOT collect

14. Best Practices - Sharing
Resume Assistance
Alumni networking
Job placement
Identify cities and states that offer repayment assistance
Military or other assistance programs