Take This Opportunity to Dig Into Cohort Default Rate Data

By Anne Fischer, USA Funds Consultant

While you examine your draft cohort default rate data from the U.S. Department of Education with an eye toward potentially submitting a challenge, take advantage of this opportunity to also dig a little more deeply.

A closer examination of your draft cohort default rate data can help your school enhance its debt management efforts — and reduce its default rates — for years to come.

The information in your Loan Record Detail Report tells you what happened with students' repayment after they left school. But your school should have its own data that tells you what happened with the students while they still were on campus.

And marrying those two types of data can help you target your default prevention efforts to the students who need help the most.

So check out your LRDR to find out information such as who withdrew from school, what year students left school, and average loan amounts.

But then use your school's own data to take an even closer look.

What does a cross-reference with your school's own records tell you about students who failed to make satisfactory academic progress, for example? And here are a few other examples of issues to consider: What academic programs are those most frequently pursued by students who defaulted? What year of study appears to be the one in which defaulted borrowers most frequently withdrew from your institution?

One school I work with is a perfect example of how combing through data can help you find a population to focus on more closely with your default prevention efforts. That school's cohort default rate suddenly jumped one year. A thorough review of data from the school's LRDR and institutional records revealed one difference during the cohort year of the rate jump: The school introduced a new certificate program. Many of that year's defaulted borrowers were part of that particular program.

That revelation showed school officials that they needed to provide even more robust debt management assistance to students in that program.

Learn more about addressing specific reasons or default.

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If you don't have this school data at your fingertips, check with your school's institutional research staff. They are an excellent resource for information — and likely can help you cross-reference the LRDR data with your school's own data.

And remember: As all of us on the USA Funds® team of consultants frequently say, don't operate your default prevention efforts in a silo. Get others on board to share resources — including your IR staff. Not only can they help you with information and assistance, but you can help them with data they might not have access to otherwise.

Another point to keep in mind is that, while this annual examination of draft cohort default rate information is a good time to thoroughly review your default prevention efforts, it's not the only opportunity. You have year-round access to the National Student Loan Data System School Cohort Default Rate History Report (DRC035) to show you whether your default prevention efforts are successful.

Need additional help? Contact your USA Funds representative to learn more about examining cohort default rate data, and about ways USA Funds can help with your debt management and default prevention efforts.