What activities are you doing at your school this month to prevent student loan default? Here are some default prevention activities you’ll want to make sure are on your to-do list for November.
Focus on outreach to grace period borrowers.
If your school is on a traditional academic calendar, your spring graduates’ six-month grace period is about to end. Make a concerted effort to contact these former students to remind them that their first payment will be due soon and to review their rights and responsibilities as borrowers. Let them know your office is there to help.
Evaluate and update your default prevention plan.
You should review your school’s default prevention plan each year, and timing that review to just after your school receives its official cohort default rate makes sense. Does your 2011 rate indicate that changes might be in order? Is your rate high enough that regulations require your school to create or update a default prevention plan? Federally mandated plans and updates are due to the U.S. Department of Education at the end of this month.
Emphasize wise money management.
Prepare your students for the potential pitfalls of upcoming holiday spending. Provide financial literacy training that will help them minimize their debt and stay on track to manage their education expenses.
Target your default prevention activities.
Are your default prevention efforts reaching the right audiences to make the greatest impact? Regularly analyze your school’s student loan data to identify trends that will help you identify the student loan borrowers who need help the most. Then adjust your borrower outreach and financial literacy training efforts accordingly.
Enhance your retention efforts.
If your school will be changing semesters soon, make sure your students understand the impact that changes in enrollment status in the upcoming new semester could have on their student loan repayment. Financial aid and retention staff could coordinate efforts to emphasize to students what dropping below half-time status, dropping out or stopping out would mean for their federal student loans.
Review your NSLDS reporting.
This review of your school’s information in the National Student Loan Data System should be ongoing. Frequent checks of the data help to ensure that your borrowers are correctly placed in deferment, grace or repayment — and that they are included in the correct cohorts for calculating default rates.