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  • Mapping Your Future, Online Student Loan Counseling Sherry Hildebrand, Resource Development Coordinator
  • PowerPoint download

    1. 1. Delinquency and Default Prevention Initiatives Jim Flippin, VP Student Loan Division R&B Solutions Nadia Keyes, VP Customer Service Edfinancial Services Bobbi Pulley, Director Borrower Services Iowa College Student Aid Commission Tim Cameron, Meteor Project Manager National Council of Higher Education Loan Programs March 21-24 · Nashville, TN NCHELP 2010 Debt Management Conference
    2. 2. Financial Literacy Dr. Jim Flippin Vice-President Student Loan Division R&B Solutions March 21-24 · Nashville, TN NCHELP 2010 Debt Management Conference
    3. 3. President’s Advisory Council on Financial Literacy 2008 <ul><li>“ On January 22, 2008, President George W. Bush signed an executive order creating, for the first time, a President’s Advisory Council on Financial Literacy. Charles R. Schwab was the first Chairman.” </li></ul>March 21-24 · Nashville, TN NCHELP 2010 Debt Management Conference
    4. 4. Why Financial Literacy is Important? <ul><li>Financial Wellness plays a vital role to students’ success. </li></ul><ul><li>According to the National Center for Education Statistics (NCES), the research arm of the U.S. Department of Education, students who dropped out of postsecondary institutions cited financial reason as the primary catalyst for leaving school. </li></ul>March 21-24 · Nashville, TN NCHELP 2010 Debt Management Conference
    5. 5. Financial Literacy Statistics (by Schools, Corporations, etc.) <ul><li>Thirty-eight states reported personal finance standards in 2004, up from 31 states in 2002. </li></ul><ul><li>Seven states, up from four in 2002, made personal finance a requirement for high school graduation in 2004. Nine states require testing in personal finance. </li></ul>March 21-24 · Nashville, TN NCHELP 2010 Debt Management Conference
    6. 6. Statistical Information <ul><li>Jump Start : 2008 survey to college students about financial concepts. Only 62% answered questions correctly, scores did increase from 59% with freshmen to 65% for seniors. </li></ul><ul><li>University of Northern Texas : developing a new tracking system to better understand the impact of their financial literacy efforts. </li></ul>March 21-24 · Nashville, TN NCHELP 2010 Debt Management Conference
    7. 7. Statistical Information <ul><li>University of Hawaii : Need assessment of control group found that 13 of 20 indicators in favor of those who participated in financial literacy workshops compared to those who did not. </li></ul>March 21-24 · Nashville, TN NCHELP 2010 Debt Management Conference
    8. 8. Strategies for Successful Financial Education <ul><li>Develop programs that provide opportunities for people to become informed consumers and understand the financial products that are available to them. </li></ul><ul><li>Provide seminars, printed materials, web-based information systems, video research. </li></ul>March 21-24 · Nashville, TN NCHELP 2010 Debt Management Conference
    9. 9. Strategies for Successful Financial Education <ul><li>Develop classroom curriculum on financial education and economic courses. </li></ul><ul><li>Create a partnership with organizations to bolster financial health awareness. </li></ul>March 21-24 · Nashville, TN NCHELP 2010 Debt Management Conference
    10. 10. Financial Literacy and Education Summit <ul><li>Theme: “ Advancing Financial Stability and Responsibility ” </li></ul><ul><li>Monday, April 19, 2010 </li></ul><ul><li>9:00 a.m. to 11:00 a.m. (CST) </li></ul><ul><li>Federal Reserve Bank of Chicago </li></ul><ul><li>230 S La Salle Street </li></ul><ul><li>Chicago, IL 60604 </li></ul><ul><li>To register: </li></ul><ul><li>www.practicalmoneyskills.com/summit2010 </li></ul>March 21-24 · Nashville, TN NCHELP 2010 Debt Management Conference
    11. 11. Successful Debt Management: Three Key Notes Nadia Keyes Vice President of Customer Care Edfinancial Services March 21-24 · Nashville, TN NCHELP 2010 Debt Management Conference
    12. 12. March 21-24 · Nashville, TN NCHELP 2010 Debt Management Conference
    13. 13. March 21-24 · Nashville, TN NCHELP 2010 Debt Management Conference
    14. 14. Outbound Efforts <ul><li>Timeline for outbound efforts </li></ul><ul><li>Early intervention through late stage delinquency </li></ul><ul><li>Many methods of delivery </li></ul><ul><li>Creative correspondence </li></ul><ul><li>Ability to adapt quickly </li></ul>March 21-24 · Nashville, TN NCHELP 2010 Debt Management Conference
    15. 15. <ul><li>Yellow Letter Campaign </li></ul><ul><li>Initiated May 2009 </li></ul><ul><li>Sent at 283 days delinquent </li></ul><ul><li>No less than the 17 th piece of mail received from us since Day 1 of delinquency, yet the majority that respond say “I didn’t know I was in default” </li></ul><ul><li>Over 880 borrowers and $11 Million saved from default to date </li></ul>
    16. 16. Strategies <ul><li>Analysis, review, and strategic response </li></ul><ul><li>Each day the buckets are filled and filled in different proportions, how do we empty the buckets? </li></ul><ul><li>Combining knowledge of staff, capacity, technology, and borrower tendencies </li></ul><ul><li>Reevaluating constantly to remove inefficiencies and learn from ineffective strategies </li></ul>March 21-24 · Nashville, TN NCHELP 2010 Debt Management Conference
    17. 17. Quality Interactions <ul><li>We’ve got them on the phone, now what? </li></ul><ul><li>Training representatives to respond to fit the borrower’s specific needs without deviating from acceptable standards </li></ul><ul><li>Listening to the commonalities among borrowers </li></ul>March 21-24 · Nashville, TN NCHELP 2010 Debt Management Conference
    18. 18. Most common borrower responses for delinquency in 2010 <ul><li>Borrower is working but income has been reduced </li></ul><ul><li>Borrower is employed but spouse is not employed </li></ul><ul><li>Borrower is planning to go back to school because unable to find employment </li></ul><ul><li>Borrower is working part time--unable to locate full time employment at this time </li></ul>March 21-24 · Nashville, TN NCHELP 2010 Debt Management Conference
    19. 19. Summary <ul><li>The goal in any default aversion program is to maximize both your opportunities as well as your ability to capitalize on those opportunities </li></ul><ul><li>Maximum effectiveness comes from diligent efforts, combined with solid planning, and executed by quality staff </li></ul>March 21-24 · Nashville, TN NCHELP 2010 Debt Management Conference
    20. 20. Student Loan Default Prevention Tool Kit Bobbi Pulley Director, Borrower Services Iowa College Student Aid Commission March 21-24 · Nashville, TN NCHELP 2010 Debt Management Conference
    21. 21. Borrower Debt Management Service <ul><li>Tool that helps borrowers stay on top of their student loan obligations. </li></ul><ul><ul><li>The statements provide students with detailed information about all of their federal loans (sweeps NSLDS) </li></ul></ul>March 21-24 · Nashville, TN NCHELP 2010 Debt Management Conference
    22. 22. Borrower Debt Management Service <ul><li>Schools can request statement based on: </li></ul><ul><ul><li>Anticipated graduation date </li></ul></ul><ul><ul><li>Withdrawal date </li></ul></ul><ul><ul><li>In-school status </li></ul></ul><ul><ul><li>Grade Level </li></ul></ul><ul><ul><li>SSN </li></ul></ul><ul><ul><li>Name </li></ul></ul><ul><li>The school may also receive a roster of students to track loan indebtedness. </li></ul>March 21-24 · Nashville, TN NCHELP 2010 Debt Management Conference
    23. 23.
    24. 24. Borrower Referral Program <ul><li>Enables schools to proactively refer borrowers who may be at risk of default to Iowa College Aid for additional assistance. </li></ul><ul><li>The Program is designed to educate and counsel individual borrowers about their obligations while they are in school, during their grace period or after they have left campus . </li></ul>March 21-24 · Nashville, TN NCHELP 2010 Debt Management Conference
    25. 25. Borrower Referral Program <ul><li>Using a secure website, the school provides borrower detail and specifies the reason for the referral as: </li></ul><ul><ul><li>Excessive debt level based on the school’s determination </li></ul></ul><ul><ul><li>Satisfactory Academic Progress (SAP) concern </li></ul></ul><ul><ul><li>Student has withdrawn </li></ul></ul><ul><ul><li>Other reason, specified in the comment section </li></ul></ul>March 21-24 · Nashville, TN NCHELP 2010 Debt Management Conference
    26. 26. Delinquent Borrower by School Report <ul><li>Helps schools identify and work with delinquent loan borrowers. </li></ul><ul><li>The data is updated monthly, can be downloaded in Excel and can be sorted by a variety of characteristics including: </li></ul><ul><ul><li>Borrower name </li></ul></ul><ul><ul><li>Borrower social security number </li></ul></ul><ul><ul><li>Borrower address and phone number </li></ul></ul><ul><ul><li>Student information (for PLUS loans) </li></ul></ul><ul><ul><li>Number of days delinquent </li></ul></ul>March 21-24 · Nashville, TN NCHELP 2010 Debt Management Conference
    27. 27. Delinquent Borrower by School Report <ul><li>The data is updated monthly, can be downloaded in Excel and can be sorted by a variety of characteristics including: </li></ul><ul><ul><li>Dollar amount delinquent </li></ul></ul><ul><ul><li>Repayment start date </li></ul></ul><ul><ul><li>Lender contact information </li></ul></ul><ul><ul><li>Estimated cohort default year </li></ul></ul>March 21-24 · Nashville, TN NCHELP 2010 Debt Management Conference
    28. 28. Delinquent Borrower by School Report <ul><li>The data can be merged into Word documents to help the school create more efficient customized communication campaigns to target various groups of delinquent borrowers. </li></ul>March 21-24 · Nashville, TN NCHELP 2010 Debt Management Conference
    29. 29. Student Assistant Grants <ul><li>Provides grant funds for the creation of student assistant positions that provide a peer-to-peer campus connection. </li></ul>March 21-24 · Nashville, TN NCHELP 2010 Debt Management Conference
    30. 30. Student Assistant Grants <ul><li>Program support is provided by Iowa College Aid including: </li></ul><ul><ul><li>Advertising and interviewing assistance </li></ul></ul><ul><ul><li>Training </li></ul></ul><ul><ul><li>Monthly conference calls </li></ul></ul><ul><ul><li>Webinar training </li></ul></ul><ul><ul><li>Newsletter </li></ul></ul><ul><ul><li>Group list-serve </li></ul></ul><ul><ul><li>Assistant website </li></ul></ul><ul><ul><li>Campus visits with assistants </li></ul></ul><ul><ul><li>Attend events hosted by assistants </li></ul></ul>March 21-24 · Nashville, TN NCHELP 2010 Debt Management Conference
    31. 31. Student Assistant Grants <ul><li>Assistant responsibilities include: </li></ul><ul><ul><li>Primarily work on default prevention and financial literacy projects </li></ul></ul><ul><ul><li>Conduct three core default prevention programs per semester (i.e. lunch and learn seminars, residence hall programs, class presentations, etc.) </li></ul></ul><ul><ul><li>Project progress must be reported to Iowa College Aid monthly </li></ul></ul>March 21-24 · Nashville, TN NCHELP 2010 Debt Management Conference
    32. 32. Student Assistant Grants <ul><li>Assistant responsibilities include: </li></ul><ul><ul><li>Participate in, at minimum, 4 monthly conference calls or Webinar trainings </li></ul></ul><ul><ul><li>Communicate among the assistant group to share project ideas, progress and feedback </li></ul></ul>March 21-24 · Nashville, TN NCHELP 2010 Debt Management Conference
    33. 33. Helping Schools & Borrowers Cope with Split Servicing Tim Cameron Meteor Project Manager National Council of Higher Education Loan Programs, Inc. March 21-24 · Nashville, TN NCHELP 2010 Debt Management Conference
    34. 34. <ul><li>“ Split Borrowers” </li></ul><ul><ul><li>Students with loans serviced at multiple loan servicers </li></ul></ul><ul><ul><ul><li>FFELP </li></ul></ul></ul><ul><ul><ul><li>Put Loans </li></ul></ul></ul><ul><ul><ul><li>Direct Loans </li></ul></ul></ul><ul><ul><ul><li>Alternative Loans </li></ul></ul></ul><ul><ul><li>Historically, these students have more difficulty in successfully repaying their debt </li></ul></ul>Growth of Split Servicing
    35. 35. <ul><li>The School Dilemma </li></ul><ul><ul><li>Multiple Federal servicers </li></ul></ul><ul><ul><li>Existing $500 billion in outstanding FFELP loans </li></ul></ul><ul><ul><li>Alternative loan servicers </li></ul></ul><ul><ul><li>Even if their students have a SINGLE servicer, the school will still need to interact with multiple organizations within each loan program </li></ul></ul><ul><ul><ul><li>Multiple user ID’s and passwords </li></ul></ul></ul><ul><ul><ul><li>Non-aggregated information </li></ul></ul></ul><ul><ul><ul><li>Different display formats and navigation </li></ul></ul></ul>Growth of Split Servicing
    36. 36. <ul><li>Historically FFELP school that recently converted to DL </li></ul><ul><ul><li>Must maintain relationships/user id’s with: </li></ul></ul><ul><ul><ul><li>Prior FFELP servicers </li></ul></ul></ul><ul><ul><ul><li>Alternative Loan servicers </li></ul></ul></ul><ul><ul><ul><li>Title IV additional servicers (TIVAS) </li></ul></ul></ul><ul><ul><ul><li>Current DL servicers </li></ul></ul></ul>Split Servicing – School Examples
    37. 37. <ul><li>Historically DL school </li></ul><ul><ul><li>Must maintain relationships/user id’s with: </li></ul></ul><ul><ul><ul><li>Alternative Loan servicers </li></ul></ul></ul><ul><ul><ul><li>Title IV additional servicers (TIVAS) </li></ul></ul></ul><ul><ul><ul><li>Current DL servicer(s) </li></ul></ul></ul>Split Servicing – School Examples
    38. 38. The Meteor Solution <ul><li>Non-proprietary, open source software </li></ul><ul><li>Real-time access to data </li></ul><ul><li>Aggregated information from multiple databases </li></ul><ul><li>Technology solution to enhance your current web services </li></ul>
    39. 39. Top Categories Where Borrowers Encounter Difficulty <ul><li>Account Balances </li></ul><ul><li>Repayment Plans & Amounts </li></ul><ul><li>Loan Cancellation </li></ul><ul><li>Default </li></ul><ul><li>Deferment & Forbearance </li></ul>
    40. 40. Data Overview <ul><li>Detailed listing of loans </li></ul><ul><ul><li>Loan status </li></ul></ul><ul><ul><li>Original and current award amounts </li></ul></ul><ul><ul><li>Summarized repayment information by servicer </li></ul></ul><ul><ul><li>Repayment plan type </li></ul></ul><ul><ul><li>Interest Rate </li></ul></ul><ul><ul><li>Next payment due </li></ul></ul><ul><ul><li>Detailed payment, deferment and forbearance history </li></ul></ul><ul><ul><li>DAR, Claim and Default information </li></ul></ul><ul><ul><li>Contact information and custom message capabilities </li></ul></ul><ul><li>The Consolidated View </li></ul>
    41. 41. Access to the Network <ul><li>Standard Implementation </li></ul><ul><ul><li>11 Independent points of access to the Network </li></ul></ul><ul><li>Campus Based Authentication Model </li></ul><ul><ul><li>Over 100 Schools </li></ul></ul><ul><li>Several customized implementations </li></ul>
    42. 42. Loan Volume <ul><li>Standard AP Implementation </li></ul><ul><ul><li>90% FFELP Loan Guarantees </li></ul></ul><ul><ul><ul><li>Real Time Detailed Data </li></ul></ul></ul><ul><ul><ul><ul><li>Approximately 62% of outstanding guarantees </li></ul></ul></ul></ul><ul><ul><ul><li>LoanLocator Information </li></ul></ul></ul><ul><ul><ul><ul><li>Approximately 28% of outstanding guarantees </li></ul></ul></ul></ul><ul><ul><li>Alternative Loans </li></ul></ul><ul><ul><ul><li>Real Time Detailed Data </li></ul></ul></ul><ul><ul><ul><ul><li>Approximately 64% of outstanding loans </li></ul></ul></ul></ul>
    43. 43. Loan Volume <ul><li>Campus Based Authentication Model </li></ul><ul><ul><li>100% FFELP Loan Guarantees </li></ul></ul><ul><ul><ul><li>Real Time Detailed Data </li></ul></ul></ul><ul><ul><ul><ul><li>Approximately 62% of outstanding guarantees </li></ul></ul></ul></ul><ul><ul><ul><li>LoanLocator Information </li></ul></ul></ul><ul><ul><ul><ul><li>Approximately 38% of outstanding guarantees </li></ul></ul></ul></ul><ul><ul><li>Alternative Loans </li></ul></ul><ul><ul><ul><li>Real Time Detailed Data </li></ul></ul></ul><ul><ul><ul><ul><li>Approximately 64% of outstanding loans </li></ul></ul></ul></ul><ul><ul><li>100% Direct Loans </li></ul></ul><ul><ul><ul><li>LoanLocator Information Only </li></ul></ul></ul>
    44. 44. The Campus Based Authentication (CBA) Model
    45. 49. Other Custom Implementations <ul><li>Currently working with: </li></ul><ul><ul><ul><li>Lenders, schools, servicers, and </li></ul></ul></ul><ul><ul><ul><li>FAMS vendors </li></ul></ul></ul><ul><li>Primary focus: </li></ul><ul><ul><ul><li>Loan tracking </li></ul></ul></ul><ul><ul><ul><li>Debt Management </li></ul></ul></ul><ul><li>Extensions of the CBA Process </li></ul>
    46. 50. For More Information…. <ul><li>Interactive Web Site Launched www.MeteorNetwork.org </li></ul><ul><ul><li>Audio presentation </li></ul></ul><ul><ul><li>Interactive demonstration version of the software </li></ul></ul><ul><ul><li>Link to the Meteor project site </li></ul></ul><ul><li>Project Documentation www.NCHELP.org/Meteor.htm </li></ul><ul><ul><li>Implementation Information </li></ul></ul><ul><ul><li>Current Provider List </li></ul></ul><ul><ul><li>User Guide and other documentation </li></ul></ul>
    47. 51. <ul><li>Tim Cameron Meteor Project Manager Office: (954) 565-7229 Cell: (954) 295-0949 [email_address] </li></ul>Contact Information

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