DEFAULT PREVENTION MODEL

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3 able of Contents Introduction Default Prevention Model Default Prevention Model Tools Statistical Analysis Packaging Philosophy Human Resources Borrower Education Alliance Building Technology Cost Benefit Analysis Costs Benefits Case Study Default Prevention The University of Texas Pan American Style Appendix Acknowledgments

4 ntroduction Based upon work done at the University of Texas Pan American, the Council for the Management of Educational Finance and Texas Guaranteed (TG) have developed a default prevention model to assist schools with the challenge of reducing student loan default. The Council is a partnership of postsecondary institutions and student loan participants who work together to promote awareness and planning among families and students about educational finance and encourage sound debt management practices. Schools should see default prevention not only as a means to remain eligible to participate in Title IV programs, but also as a service to student loan borrowers. Students attend college to obtain an education, to prepare for a career, and to secure their financial futures. In order to help students attain those goals, schools must provide them with the resources they need, including the ability to manage debt. Even though this model was created on the principle that students come first, the value of lowering the default rate to schools should not be downplayed. A high default rate can trigger institutional disqualification from participation in not only the Federal Family Education Loan Program and Federal Direct Lending Program, but also all Title IV student aid programs. The loss of federal aid affects both institutions and students. This model is designed to work as a whole or to allow institutions to pick and choose the areas that will be most beneficial to their particular problem. In addition,tg provides training to help schools implement the model, or parts of the model. Schools should also remember that once a default rate is under control, maintenance is required to keep it that way. The University of Texas Pan American model, included at the end of this document, provides an example of a successful default prevention program. 2

5 DEFAULT PREVENTION MODEL Tools Statistical Analysis Packaging Philosophy Human Resources Borrower Education Alliance Building Technology 3

6 tatistical Analysis Statistical Analysis Study Student Population Gather and Analyze Statistical Data on a Monthly and Yearly Basis Institutional Variables Servicers/ Lenders 1. GPA 2. Income 3. Year In College 4. Class 5. College Entrance Scores 1. Track Performance 2. Compare Performance 3. Identify Problems 4. Identify Best Practices 5. Solicit Assistance Demographic Variables University/College/ Proprietary School 1. Student Population by County 2. County Employment/ Unemployment Rates 3. Per Capita Income by County 1. Track Performance 2. Compare Performance 3. Track Default Rate 4. Project Future Rates 5. Identify Best Practices Getting to know individual students is a must. It is important for financial aid officers to know the student population in general, as well as the institutional and demographic variables of student loan defaulters.those variables include identifiable predictors to default, which, however, are not universal. Study Student Population Analyze the student population. Enlist the aid of professional statisticians on the faculty or at a guaranty agency. Request student data from the school s computer center or from a guaranty agency. 4

7 Identify any common characteristics between: Defaulters and non-defaulters, and Borrowers and non-borrowers. Examine institutional variables including: GPA, Income, Year in college, Class, and College entrance scores. Examine demographic variables, such as: Student population by county, County employment and unemployment rates, and Per capita income by county. Use the findings to help create a default management plan. Once a default prevention plan has been implemented, compile and analyze data to identify problem areas. Gather and Analyze Statistical Data on a Monthly and Yearly Basis Servicer and Lender Track the performance of each servicer and lender. Use TG s lender and servicer cohort default rate estimates to: Benchmark servicers on their default rate, and Benchmark lenders on their default rate. Compare the performance between servicers based upon: The number of claims filed per month, and The number of claims paid per month. Identify problem areas. Identify best practices among servicers. Open a dialogue with servicers and lenders, and solicit their assistance in lowering the default rate. University, College, or Proprietary School Track the performance of the university, college, or proprietary school s default management plan. Benchmark the institution s default rate with similar institutions. Gather data from TG s School Fact Sheets ( or and The Department of Education web site ( 5

8 Identify how differences between the institutions might account for differences in the default ratios. Track the present cohort default rate using the following calculation (for schools with more than 30 students entering repayment): Number of students who entered repayment during the specified fiscal year and defaulted within that fiscal year or the subsequent fiscal year Numerator Denominator Number of students who entered repayment during the specified fiscal year x 100 For example, the formula for calculating the cohort default rate for FY 1997 would look like this: Students who entered repayment on their loans during FY 1997 and defaulted during FY 1997 or FY 1998 (October 1, 1996, to September 30, 1998) Numerator Denominator Students who entered repayment on their loans during FY 1997 (October 1, 1996, to September 30, 1997) x 100 If the number of students entering repayment between October 1, 1996, and September 30, 1998, equals 247 and the number of students entering repayment between October 1, 1996, and September 30, 1997, was 1,869, then the 1997 cohort default rate would be calculated the following way: Students who entered repayment on their loans during FY 1997 and defaulted during FY 1997 or FY 1998 (October 1, 1996, to September 30, 1998) Students who entered repayment on their loans during FY 1997 (October 1, 1996, to September 30, 1997) x 100 = 13.2 % Project future rates using TG s Default Management Report (DMR) to take action to minimize the default rate. A DMR lists all borrowers at a school who entered repayment during a specified fiscal year and provides repayment status and demographic information for each borrower. DMRs can be ordered by contacting TG s Research and Analytical Services at (800) or by sending an message to cust.assist@tgslc.org. TG can also provide assistance in interpreting the data. Identify best practices among institutions and emulate them. 6

9 ackaging Philosophy Packaging Philosophy Target Potential Defaulters Award Gift Aid in Lieu of Loans Award Work-Study in Lieu of Loans Promote Scholarships Promote Conservative Borrowing Offer Counseling Services Once potential defaulters have been identified, target this portion of the student population through a change in packaging philosophy. Target Potential Defaulters Reallocate a portion of state and institutional grants to award potential defaulters. Reallocate a portion of work-study funds to award potential defaulters. Promote scholarships. 7

10 Promote conservative borrowing. Offer comprehensive counseling services: Meet one-on-one with potential defaulters who are requesting loans in order to limit debt by determining the student s eligibility for other gift aid such as: AFDC exemptions, State or institutional grants, Scholarships, Work-study, and/or Educational aid exemptions. Identify the real costs of a higher education. Prepare a realistic budget with the student. Discuss expenses and money-saving strategies. Analyze salary surveys. 8

11 uman Resources Human Resources Hire a Default Prevention Officer Education Experience Skills Every financial aid office should include a full-time professional to function as a Default Prevention Officer. Hire a Default Prevention Officer General Job Description The Default Prevention Officer should devote his or her full-time efforts to the following responsibilities: Administer the institution s default prevention program; Serve as a financial aid advisor for an assigned caseload of student aid recipients; Serve as a liaison between the office of student financial aid and other campus departments, parents, and outside agencies such as student loan lenders, servicers, guaranty agencies, and the Department of Education (ED); Render decisions and oversee processes requiring initiative and judgment in responding to the individual needs of students; Develop the information needed to prepare reports required by financial aid programs; 9

12 Counsel and advise students regarding their financial options and responsibilities; Supervise employees in administration of the school s default prevention program; Manage pre-claims assistance efforts such as telephone and letter campaigns; Handle pre-loan and exit-loan counseling and implement enhancements to the procedures; Supervise and perform statistical analysis for internal and external reporting; Track the school s cohort default rate; Interpret and implement regulations set forth by ED and state guaranty agencies; and Oversee the timely completion of deferments and enrollment history requests by working closely with the registrar s office or assuming the responsibility in the financial aid office. The position requires the following education: A bachelor s degree in a field related to the default prevention program, such as business, communications, or social work. Position experience should include: Two to three years experience in the appropriate field of the program with two years of responsible administrative experience. Preferred two to three years experience in student financial aid loan programs and related outside agencies such as lenders, servicers, guaranty agencies, and ED. Working knowledge of database, spreadsheet, and presentation software as well as computer hardware. The Default Prevention Officer must possess the following skills: Excellent writing skills, Communication skills, Interpersonal skills, and Organizational skills. The Default Prevention Officer must be able to: Analyze data, Forecast and plan, Work under pressure, Solve problems, and Accept and implement change. 10

13 orrower Education Borrower Education Enhanced Entrance Counseling Review Sessions Comprehensive Counseling to Delinquent/Defaulted Borrowers Enhanced Exit Counseling Providing comprehensive entrance and exit counseling sessions is an excellent way to educate students on the rights and responsibilities of borrowing a student loan. This type of interactive session creates an environment in which the borrower can ask questions and voice concerns. Requiring students to attend yearly review sessions will reinforce the information covered during the entrance counseling session. Enhanced Entrance Counseling Invite loan specialists, lenders, and servicers to present at the sessions. Distribute materials containing loan information to the borrowers for future reference. Delay certification of loan applications until first time borrowers have attended a session. Offer sessions intermittently throughout the semester to promote attendance. Offer one-on-one entrance counseling to students who cannot attend group sessions. Use entrance counseling features on 11

14 Test borrowers at the end of the session to identify students who may need additional counseling. Use test results as an indicator that all relevant information is being covered during the session. Discourage multiple lenders and guarantors. Review Sessions Provide students with disclosure statements that contain the following information: Cumulative amount borrowed, Estimated interest, and Estimated monthly payment. Provide students with loan summaries. Update students on changes in financial aid office procedures. Remind students of their rights and responsibilities. Gather updated information from students, including: New addresses and telephone numbers, Changes in their permanent addresses, Reference information, and Employment information. Cover the consequences of default. Allow borrowers to use online entrance counseling sites offered by lenders and servicers. Forward updated student information to the guarantor. Offer Comprehensive Counseling to Delinquent and Defaulted Borrowers Counsel and assist delinquent and/or defaulted borrowers either in person or over the phone. Act as a liaison between the student and the lender, servicer, and/or guaranty agency. Facilitate the completion of documents such as deferments and forbearances to expedite the clearing of accounts. Prepare and submit enrollment histories to the servicer if the student fails to sign a deferment. 12

15 Educate delinquent borrowers on repayment options: Standard repayment plan, Graduated repayment plan, Income sensitive repayment plan, Repayment incentives offered by servicers, and Consolidation. Educate defaulted borrowers on repayment options: Regaining eligibility for Title IV aid, Loan rehabilitation, and Consolidation. Counsel excessive borrowers (to be defined by the individual institution) on a one-on-one basis about: Responsible borrowing, Budgeting, Debt management plans, Repayment options, and Salary expectations. Enhanced Exit Counseling Invite lenders and servicers to present at sessions. Include and emphasize the correct procedures transfer students should follow when notifying their lenders that they have transferred and in filing deferments. Provide students with a loan summary that includes the names and phone numbers of lenders, servicers, and guaranty agencies. Offer one-on-one exit counseling to students who cannot attend group sessions. Let students know they can call the school for assistance; provide them with the name and phone number of a contact person. Verify that all exit interview forms are completed in full. Administer an exam at the end of the session to identify students who may require additional counseling. Send borrowers a letter or brochure during their grace period reminding them of their rights and responsibilities and listing phone numbers to call for assistance. 13

16 lliance Building Alliance Building Campus Departments Outside Agencies Registrar s Office Lenders Placement Office Servicers Guaranty Agencies Department of Education For an institution to combat a default rate problem, it must have the support of its own campus in addition to lenders, servicers, and guaranty agencies. Forging alliances facilitates learning and promotes progress. Work Closely with Other Campus Departments to Promote Default Prevention Emphasize to the registrar s office the importance of cooperating in a timely manner to complete deferments, enrollment histories, and skip tracing requests. 14

17 Stress the importance of default prevention to upper administration and request their assistance in helping secure resources. Enlist the assistance of alumni organizations and the registrar s office to provide updated address information to servicers; this will help with skip tracing. Make default prevention a priority for the entire financial aid office by educating front counter staff and advisors on default prevention measures. Invite placement office counselors to present at exit sessions. Work Closely with Outside Agencies to Promote Default Prevention Participate in pilot programs. Take advantage of services offered by lenders, servicers, and guaranty agencies such as: Supplemental due diligence, Online account access, Default Management Reports, and Online entrance and exit counseling via the web. Invite industry experts to train financial aid office staff on default prevention methods. Assist with skip tracing activities. Develop a relationship with guaranty agency representatives to communicate any special needs in dealing with delinquent or defaulted borrowers. Provide the servicer and guaranty agency with the name and phone number of a contact person at the institution who can assist with the immediate completion of deferments, enrollment histories, or skip tracing. Request the assignment of a contact person for the times when circumstances require that the processing of forms be expedited in order to prevent default. 15

18 echnology Technology Electronic Linkages Internet Access The effective use of technology simplifies processes, which in turn saves time and labor. Electronic Linkages Use the weekly Electronic School Report (ESR) offered by TG. UT Pan American downloaded the ESR report using BNET and imported the file into FileMaker Pro software* already purchased and owned by the school. The report can also be downloaded via TG s Request Report Distribution (RRD). RRD is a TG tool provided to schools and lenders to facilitate the request/receipt of various reports including the Electronic School Report. Log on to the National Student Loan Database ( for student information. 16

19 Internet Access Create a financial aid web page for students to view and use as a reference. Provide links for students to other financial aid and scholarship sites. View and print loan summaries from Adventures in Education ( to distribute to students at exit counseling sessions. Download default reports offered by lenders and servicers. View and print account information from servicers who offer this information over the Internet. Download and print deferment and forbearance forms. Request and use TG s Default Management Report (DMR) to identify delinquent and defaulted borrowers to begin default prevention efforts. Provide computers for students to use, either in the lobby of the financial aid office or in a lab setting, to access their account information online. Take advantage of TG s default and delinquency scoring on the DMR, to identify defaulters. Receive school loan reports from servicers through , import them into a database program, and tailor the reports to meet the school s default prevention needs. Use to communicate with borrowers and/or parents in the form of newsletters on a semester basis. Ask the school s administration to allow students to use their school addresses for up to two years after leaving school to keep in contact with borrowers. Encourage students to use as a way to communicate with financial aid office staff. 17

20 osts The costs of implementing a sound default prevention program vary depending on which default prevention tools the institution chooses to implement. Costs fall into two categories: Costs associated with developing the default prevention program: New equipment and software A workstation equipped with a PC and modem, and Additional phone lines. Training. Costs associated with the day-to-day operation of the default prevention program: Personnel costs such as wages Supplies Paper, Envelopes, Postage, and Postcards. Overhead costs Telephone service, Long distance, Utilities, and Maintenance. enefits The benefits of a successful default prevention plan also fall into two categories: Tangible: Lower default rate, and Savings to taxpayers. Intangible: Improved service to students, which in turn leads to good will, and Better service to the community. Start-up and maintenance costs may seem significant, but the cost to an institution that loses the ability to offer financial aid to students would be devastating. 18

21 efault Prevention The University of Texas- Pan American Style 19

22 I. The Problem 1994 The University of Texas Pan American (UTPA) Financial Aid Office is in crisis due to the FY 1992 Cohort Default Rate rising to 20.9 percent up 6.4 percentage points from FY History of Cohort Default Rates Fiscal # of Borrowers # of Borrowers Default Rate Year in Repayment in Default , % , , , II. Statistical Analysis Taking advantage of the university environment, UTPA recruited professional statisticians on the faculty to analyze the student population and identify characteristics of the typical defaulter. A. The statisticians examined various institutional variables: 1. Student Loan Data Analysis by Classification Freshmen Sophomores Juniors Seniors Graduates Defaulters 44.0% 18.4% 10.8% 23.7% 3.1% Non-Defaulters Student Loan Data Analysis by GPA, Income, and Year in College GPA Income Year in College Defaulters 1.76 $12, Non-Defaulters , College Entrance Scores The differences between the college entrance scores of defaulters versus non-defaulters were not significant. 20

23 B. Demographics examined: 1. Student Population by County (December 1996) Starr 6% Cameron 6% Willacy 2% All Others 5% Hidalgo 81% 2. County/State Populations and Employment/Unemployment Estimates (December 1996) County/ State Population Employment Unemployment Unemp.Rate Hidalgo 485, ,878 33, % Cameron 304, ,084 13, Starr 49,058 16,602 5, Willacy 19,465 6,339 1, Texas 18,724, Total Per Capita Income by County/State (1990 Census of Population and Housing) Total Per Capita Income County/State Per Capita Income Hidalgo $6,630 Cameron 7,125 Starr 4,152 Willacy 6,074 Texas 12,904 21

24 C. Findings: GPA, income, year in college, and college entrance scores were not good predictors. The only finding of any statistical significance: 44 percent of defaulters were first-time freshman borrowers percent of student enrollment comes from four surrounding counties where unemployment rates in three counties are more than triple the unemployment rate of the state of Texas. The per capita income in the same four surrounding counties is half the per capita income of the state of Texas. III. The Plan 1995 The U.S. Department of Education approved UTPA s default management plan, which was required after the 1992 Default Cohort Rate of 20.9 percent. The University of Texas Pan American s Default Management Plan A. Change packaging philosophy: 1. Offer a grant in lieu of a loan for entering freshman first-time borrowers, since the statistical analysis proved freshmen were responsible for a high percentage of defaults (See Figure 1). 2. Do not award students Perkins loans and Stafford loans in the same award package (unless documented professional judgment is included). Figure 1 No further action required If the student accepts Package Student If the student requests additional funds Meet with Default Prevention Officer Award loan and print award letter If the student requests a loan Discuss options with student Student attends entrance session If the student accepts the grant The student submits an application Award grant and print award letter 22

25 B. Additional personnel were added to the financial aid office to address default: 1. Default Prevention Officer, 2. One part-time employee (30 hours per week), and 3. One work-study employee. C. The responsibilities of the default prevention area were enhanced to include: 1. Comprehensive counseling services for borrowers: Entering freshmen One-on-one debt management counseling conducted with entering freshman firsttime borrowers; students are encouraged to borrow conservatively and to use student loans as a last resource of financial assistance. Excessive borrowers Responsible borrowing is also the theme of these counseling sessions. Delinquent and defaulted borrowers Provide pre-claims assistance to students to prevent technical defaults (i.e., provide deferment forms). Promote grants, part-time jobs, and scholarships. 2. Use of delinquency/default information tracking tools: Use TG s Weekly Default Prevention Activity Report. This report provides the following information: Processed deferments, Processed forbearances, Payments, Students who are 90-, 120-, and 180-days delinquent, Time cures, and Students who have paid loans in full. Take advantage of TG s Claims Paid Report. This report lists students who have had claims paid, and the reason the claim was paid. Monitor satisfactory repayment arrangements. Students who enter into a satisfactory repayment arrangement with a guaranty agency, collection agency, or the Department of Education must be monitored each semester to verify that they remain in compliance with the terms of the agreement. Place and remove holds. Holds are placed on the records of students who are 120-days past due or have default claims pending on loan(s). This prevents students from obtaining an academic transcript or registering for additional classes without first meeting with a financial aid counselor. 3. Generation and printing of 90-day, 120-day, and claim-pending call reports. The students who appear on these lists are called and offered assistance in dealing with their delinquent loans (See Figure 2). 4. Generation and printing of 90-day, 120-day and claim-pending letters. Letters that include a listing of the consequences of default, as well as the name and phone number of the servicer the student needs to contact, are sent to delinquent students (See Figure 2). 23

26 5. Phone calls to delinquent borrowers. Calls are made to students who are 90-, 120-, and 180-days delinquent to offer them assistance and guidance related to their delinquent loan (See Figure 2). Calls are also made to servicers, as a follow up, to determine whether the student has been granted a deferment or forbearance. Figure 2 Download Electronic School Report Import into Database 90-Days Delinquent 120-Days Delinquent Claim Pending Call Report Letter Call Report Letter Call Report Letter Generate Generate Generate Generate Generate Generate Print Print Print Print Print Print Mail Place Holds Mail Place Holds Mail Call Student Call Student Call Student Send Postcard Send Postcard Send Postcard 6. Improvements in the process for Deferments/Enrollment Verification requests. The financial aid office assumed the processing of deferments and forbearances that previously were filed by the admissions office to ensure completion in a timely manner. 7. Processing change-of-address requests from lenders, including re-sending returned mail. 8. Monthly statistical reports Benchmarking servicers on their default rate. Benchmarking lenders on their default rate. Purpose: to identify servicers and lenders with high default rates to solicit their assistance with lowering UTPA s default rate. First-time borrower history. Purpose: to track the number of freshmen first-time borrowers. Average borrower debt per lender. To track the average amount of UTPA student debt per lender. TG s Default Management Report Statistics. To monitor the number of resolved delinquencies and forbearances that are being processed to measure the success of measures implemented to assist students. Default claims filed per servicer. 24

27 To track the number of default claims being submitted to request increased default prevention activities from lenders and servicers. Default claims paid per servicer. To track the number of default claims paid on a monthly basis. First-time borrower tracking. To monitor the enrollment status of first-time borrowers as they progress beyond their freshman year. Students who do not re-enroll at UTPA will receive a phone call offering information and assistance on how to handle deferments, forbearances, and repayment options. D. Alliances built with guaranty agency, lenders, and servicers: 1. Texas Guaranteed (TG) Currently UTPA receives a weekly electronic school report to print customer service letters and telephone logs (pilot project). UTPA receives a monthly electronic default management report (DMR), which allows tracking of the default rate of the University and servicers; by tracking the default rate of the servicers, UTPA is able to benchmark the quality of service that they provide to students. 2. Sallie Mae UTPA participated in a pilot program with Sallie Mae aimed at examining alternative collection strategies and identifying those that produce lower delinquency and default rates. 3. COSTEP Provided staff to assist with calling campaigns. Hosted default prevention workshops for UTPA staff. Partnered with UTPA in outreach efforts. E. Electronic linkages/internet access: 1. UTPA receives the weekly Electronic School Report (ESR) every Monday from TG via RRD. The ESR allows UTPA to print customer assistance letters for students who are past due on their student loans (90-day, 120-day, and claim pending). In addition, UTPA can print telephone logs to use in calling students to offer them assistance. 2. UTPA receives monthly School Loan Report from AFSA Data Corporation in a Microsoft Excel file format. This type of format allows UTPA to manipulate the data to meet its needs. For example, a query can be run to extract all the students who are between 120- and 180-days delinquent. These students are then targeted for phone calls and letters. 3. Access to the Internet is an important tool UTPA uses to fight default. Loan summaries are viewed and printed from the Adventures In Education web site for UTPA financial aid office personnel information and for the student s information. Access to AFSA Data Corporation, Sallie Mae, and UNIPAC s web sites and online borrower accounts is beneficial for viewing and printing account information for students and downloading and printing deferment and forbearance forms. 25

28 A monthly Borrower Delinquency Report can also be generated and printed from UNIPAC s web site. In addition to listing delinquent borrowers, this report also summarizes the information in an easy-to-understand format, which can be used for benchmarking purposes. F. Enhanced entrance and exit loan counseling 1. Lenders and servicers are involved in loan counseling sessions. 2. Pre-loan counseling sessions provide more information on the Stafford Loan Program and emphasis is placed on the responsibility of the borrower. 3. Certification of first-time borrower loan applications is delayed until a student successfully completes a pre-loan counseling session. 4. The pre-loan test is continuously reviewed for enhancements to test a student s knowledge of a borrower s rights and responsibilities. 5. A student must pass the test to receive credit for attending the pre-loan counseling session. 6. Exit counseling sessions have been improved to provide more information on a student s rights and responsibilities once he or she enters repayment. 7. At the beginning of the exit loan counseling session, a student is given a summary of his or her loans printed from TG s web site. 8. At the end of the exit counseling session, students take a test that helps to identify those who may need additional counseling. IV. The Results A. Since UTPA s default management plan has been implemented, there has been a 36 percent decrease in the default rate in the last four years and a net decrease of 7.6 percentage points. B. The number of entering freshmen receiving loans has been reduced by 84 percent. 1. History of Freshmen Borrowers Number of Freshmen Awarded Loans Academic Year 26

29 2. Decrease in Cohort Default Rates after implementation of UTPA s Default Management Plan Fiscal # of Borrowers # of Borrowers Default Rate Year in Repayment in Default , % , , , , , Correlation between the number of freshmen borrowers and the default rate after the implementation of UTPA s Default Management Plan Entering Freshmen Cohort Year (FY) Cohort Default Rate (percent) V. The Future UTPA will continue to evaluate and analyze its default prevention area to improve its success in addressing the issue of default prevention. Current ideas being considered include: Increasing debt management and personal budget counseling incorporated into the entire financial aid process. Creating debt management seminars for UTPA students. Automating deferments and enrollment history process. Providing updates and information to student borrowers on a semester basis through the use of campus-wide . Continuing to build alliances with other agencies in the student loan industry. 27

30 ppendix TG Reports to Help in Default Prevention Efforts Default Management Report (DMR) The DMR lists all TG borrowers at a school who entered repayment during a specified fiscal year. The report allows a school to determine which borrowers are currently in a delinquency status or have pending claims or defaulted loans with TG. A third section provides addresses and telephone numbers for borrowers in the repayment cohort. The DMR can be used to: Define a repayment cohort and calculate a cohort default rate. Monitor a school s month-by-month cohort default rate. Help to forecast a school s cohort default rate. Identify delinquent borrowers for targeting with default prevention resources. Contact borrowers using the address and phone number information. Lender and Servicer Cohort Default Rate Estimates Lender and Servicer Cohort Default Rate Reports provide cohort default rate estimates for lenders and servicers based upon the TG borrowers at a particular school.the reports also provide estimates of lenders and servicers overall cohort default rates based upon TG data, as well as the school s estimated cohort default rate. Lenders and servicers are listed on separate reports. These reports can be used to track lender or servicer performance and compare the performance of lenders or servicers. School Fact Sheets The School Fact Sheets are a convenient resource that deliver basic TG student loan program data, enrollment statistics, academic outcomes, student cost information and other data about each postsecondary institution in the state of Texas that participates with TG.The School Fact Sheets are available as a printed publication and can also be found on the Internet at under Publications. It can be used to compare a school s cohort default rates with other similar schools and identify possible factors related to a school s default situation, such as high borrower indebtedness, low retention rates, or low graduation rates. TG Contact Information To order a DMR or a Lender and Servicer Cohort Default Rate Report, call your TG Customer Service Consultant. Provide your school s name, school identification number, and the cohort year for which you want a report. To access the School Fact Sheets, go to and select Publications. For questions about the data on any of the reports, call TG s Research and Analytical Services at (800) Weekly School Report The Weekly School Report provides information regarding current and/or former students to schools.the report identifies current delinquencies, skips, and claims filed on their students. A copy of your school s report is available from TG Default Prevention by calling (800) or by at prevent.default@tgslc.org. 28

31 cknowledgmentsto Default Prevention: A Model for Institutions of Higher Learning has been developed through the joint efforts of the Council for the Management of Educational Finance, the University of Texas Pan American, and Texas Guaranteed (TG). For questions or additional information, contact TG Customer Assistance at (800) This publication is also available on the web at FileMaker is a registered trademark of FileMaker, Inc. Excel is a registered trademark of Microsoft Corporation. 1999, Texas Guaranteed Student Loan Corporation.

32 Revised May