Awards recognize campus innovations to help students minimize, manage education debt

USA Funds recognizes three schools for debt-management excellence

INDIANAPOLIS — USA Funds®, the nation’s leading education-loan guarantor, announces the recipients of USA Funds 2007 Excellence in Debt Management Awards. The fourth-annual awards recognize postsecondary institutions that have successfully developed and implemented effective and creative debt-management programs for their students.

The award recipients are as follows:

  • Best Debt-Management Program — International Academy of Design and Technology, Tampa, Fla.
  • First Runner-Up — West Virginia University School of Medicine, Morgantown, W.Va.
  • Second Runner-Up — Indiana Business College, Indianapolis.

“These schools have taken the initiative to develop creative programs of significant scope to help their students minimize debt while in school, manage that debt following graduation, and repay the loans that financed their education,” said Denise B. Feser, USA Funds senior vice president, customer relations. “USA Funds is pleased to recognize these schools’ accomplishments and share their creative practices.”

International Academy of Design and Technology is a private, four-year college with a dozen campuses in the United States and Canada. Since mid-2006 staff members at the IADT campus in Tampa, Fla., have been responsible for the debt-management programs at all of their branch campuses. School staff members provide quarterly presentations for new students using USA Funds’ financial-literacy program, USA Funds Life Skills®.  The school also makes use of USA Funds Life Skills components in exit interviews with graduating students and students who have withdrawn from school. IADT also uses USA Funds Debt Manager® to contact borrowers during their grace periods, at the end of deferment and forbearance periods, and when borrowers fall behind in their loan payments. These  borrower-contact efforts using USA Funds Debt Manager resolve an average of 50 loan delinquencies every week and contribute to an ongoing decline in the school’s default rate.

West Virginia University School of Medicine serves approximately 425 medical students. Students receive an annual letter indicating their current educational debt and an estimate of their payments based on that debt level. As part of their orientation, all first-year students are required to participate in an hour-long personal-finance presentation, and graduating students participate in a three-hour session that focuses on exit counseling, loan consolidation and more details of money management. Future enhancements will include a session for second-year students to educate them about common money terms, budgeting and other personal-finance topics, and voiceover presentations to be housed on the student Web portal that will discuss a variety of money-management topics.

Indiana Business College, a 105-year-old private career school with 11 campuses and an online program, serves approximately 4,500 students. Indiana Business Colleges uses USA Funds Debt Manager to contact student-loan borrowers and help them resolve past-due loans. If borrowers can’t resolve their payment problem through fax, e-mail or online, college staff members are willing to go the extra mile, for example, by providing home visits or visits to the borrower’s workplace. The college conducts financial-aid meetings with each student on more than one occasion, and provides loan counseling in addition to the required entrance interview for each additional loan period. As a result of these efforts, the cohort-default rate for the main campus has been reduced to 4.8 percent, according to draft figures for the 2005 cohort, down from the final 2003 cohort-default rate of 7.3 percent.

Summaries of the award-winning programs are available on the USA Funds Web site.