During a recent webcast, representatives of two postsecondary schools shared their best practices for preventing student loan default — tactics they said would not have been as effective without USA Funds Borrower Connect™
Linda Ballard of Texas Southern University
spoke of her school’s default prevention success. “Without USA Funds Borrower Connect and knowing who we were reaching out to,” she said, “it would not be what it is now.”
USA Funds Borrower Connect is a Web-based tool that automates borrower communication through telephone, letter and email campaigns, using loan information you upload from your various loan servicers.
Ballard, director of Texas Southern University’s Office of Student Financial Assistance, said her school communicates with borrowers using a variety of methods timed to specific events. The Houston-based school offers in-person exit counseling as well as in-class training to freshmen. TSU also sends emails to former students, and mails postcards with messages connected to events, such as the holidays and back-to-school time.
Janice Nowak, financial aid director at Edward Waters College
, said her school provides in-person entrance counseling and makes one-on-one counseling a requirement for approval for graduation. The school regularly provides debt management information to students who are in school, including when they collect aid refund checks.
Based in Jacksonville, Fla., Edward Waters College also uses social media to share default prevention messages.
Representatives from both schools touted the importance of having good contact information for borrowers, to assist with reaching out to help with loan repayment.
“Good demographics is one of the main components of default prevention,” said Latisha Marion, TSU’s default prevention coordinator.
The schools use USA Funds Borrower Connect to help with default prevention outreach to former students, with EWC using USA Funds Borrower Connect to send emails and letters. TSU communicates by phone, letter and email and tracks its efforts with monthly reports in USA Funds Borrower Connect.
Default rate success
The default prevention practices of Texas Southern University and Edward Waters College have led to significant cohort default rate decreases for both schools. TSU shored up its default prevention activities when it was projected to have a cohort default rate of more than 30 percent; the school expects its next draft rate to be 18 percent. EWC’s three-year rate has dropped to 25 percent from more than 32 percent.
“It’s been a long journey, but USA Funds Borrower Connect definitely was instrumental in our decrease,” said TSU’s Ballard.