USA Funds Default-Prevention Council Member Delivers Personal Attention to Students

Martha Ramos believes so strongly in educating students about their student loans that she’s personally involved in each student’s entrance- and exit loan counseling.

Ramos, the Stafford repayment coordinator at the Fashion Institute of Design and Merchandising in Los Angeles, says students will take responsibility for repaying their loans if they understand the                                    loan process.

“I teach them what they need to know and guide them about what questions to ask their lenders,” she says.

She won’t, however, do the work for students. If students want deferments or forbearances on their loans, she makes them file the forms themselves. “If they don’t do it, they won’t learn,” she says.

Ramos’ loan-education program begins at orientation. Students start new classes every quarter, and most students graduate with two-year degrees. FIDM also has campuses in San Francisco, Orange County and San Diego. A total of 5,500 students attend classes on all campuses, and about three-fourths use financial aid.

During orientation Ramos and one of her lender-partners discuss federal regulations and how the student-loan program works. Students must sign an entrance-interview form acknowledging that they attended. If they miss the orientation session, they must attend a makeup workshop about a week later.   

“If they don’t attend either session, they can’t register for the next quarter without passing an online entrance test,” Ramos says, noting that students must score 100 percent to pass.

In addition, each year students must earn 100 percent on an online loan-counseling exam to register for the third quarter. Upon graduation, students attend an in-person session with Ramos where they learn the details of repaying their student loans.

“The most important thing students can do is be comfortable with their lender. Write down what your lender tells you and don’t hang up the phone until you understand,” she says.

Ramos has been working with students in financial aid for more than 14 years. She started her career in banking in the accounting department of a savings-and-loan organization. When it closed down in the early ’90s, she put her banking experience to work at the Fashion Institute.

She says that students today understand more about debt, credit and student loans than they did when she first started, and that there are more tools available to help educate them. With the increase in private loans, however, students are borrowing more than they need, she says.

She recalls one student who racked up $51,000 in debt with Perkins loans, subsidized and unsubsidized Stafford loans, and private loans. “Students still don’t understand the impact of not budgeting and borrowing too much in private loans. A lot of students are taking out private loans for living expenses,” she says.

Since 2001 Ramos has served on the USA Funds^® Default-Prevention Council, a group of financial-aid professionals devoted to developing debt-management initiatives to help schools lower student-loan default rates.

She says she enjoys learning “tricks of the trade” from other council members and is proud of the role that the council played in helping develop USA Funds Life Skills^®, a financial-literacy program schools can implement with their students.

“More than anything else I think the council helps the students because of the programs and initiatives it helps to put in place,” she says.