I know that many prospective students have false ideas about Financial Aid with regard to entitlement and payback. The preenrollment counseling is an ABSOLUTE PRIORITY to inform prospective students about the advantages AND pitfalls of financial aid, Title IV and otherwise.
the institution set-up default prevention program to help student to from going into default
First would be to make sure the student understands they are taking loans and that they have to be paid back. Second, work with the students to get the highest possible graduation rate. My school has a department that only works with students on their loans.
Building a bridge with the student up front is important, as a recruiter we have the responsibility to be a head of the curve on the financial portion of the discussion. We are the first to speak to the student and giving all disclosures up front gives the student the knowledge and understanding of what they will need to discuss with the financial aid department.
I think the most important thing an institution can do is set up students for success from the beginning and following up prior to graduation to keep the student on track. The ultimate responsibility lies with the school to have integrity and teach the student how it is possible to follow a budget. Our school does the counseling before enrollment and prior to graduation.
I believe the best thing a school can do is financial counseling throughout their time as a student and beyond. Students are more prone to be active in the their repayment efforts if they are informed.
I think the most important thing an institution can do to prevent default is to maintain high retention and graduation rates. A graduate who is meeting his/her career objectives is much more likely to repay his/her student loan debt than a student who withdrew halfway through the program of study. Our institution recently added a Student Services Director to specifically focus on the task of helping to keep our students in school and to reach graduation.
I agree with Joseph, I believe that we should offer credit awareness or personal finance as a part of the students professional development. After all credit is essential to the students success after completing school.
To be honest, I have not dealt with this topic too often during my time as an admissions respresentative. However, I try to stress the fact that they are investing in their future. This investment includes everything from the loans they may or may not take out to the time and effort they commit to the process.
When a student first applies to the school we pay close attention to their attitude, responsibility and quality of required application materials. It is also important for students to receive information about paying back their loans, as it is not always common knowledge for people. Also, a successful career services department- if a student has support in finding a career, the better off they will be financially.
As an admissions person, we are in continued contact with our students. On a weekly basis we reach out to them and always offer our support and "ear" to help them get through the adult matters which can lead to dropping out and losing the vision. With a "team" effort retention will increase and students become graduates and have the opportunity to work in the profession....and we all know people who get through and go to work are more likely to pay back their loans.
Provide the student with a proper education and prepare them for the workforce is the most important thing an institute can do to prevent default on student loans. Doing an exit exam regarding the importance of repaying their loans is crucial to assist in default management.
Our school has implemented a financial leteracy tool called Igrad where the student can go to prepare themselves for life after graduatuation and educate them on thinking about loan repayment before their grace period expires after they graduate.
I believe we should be letting the students know the importance and severity of the student loan process from day 1. They need to understand that while it may be a scary process, it is necessary as an investment in themselves. This is what it will take to move on to that future career they are dreaming of.
By being clear and upfront when explaining the process. I generally don't delve into financial aid very often.
Our school has a seperate financial department that handles the loan and grant process. They also manage the debt counseling.
Being that financial education is taught very little in high school or college, I think it is important that this type of topic is discussed with students, throughout their education. First it is beneficiary to inform and discuss with students what to expect with their student loans after they leave school. Also in that conversation inform and discuss payment options and default mitigation as well. In addition to that, I think basic financial budgeting classes are also critical. Many students have no idea how to balance a checkbook, let alone pay their bills on time and/or be responsible for debt they are unsure how it works. Overall I think financial education is key, from how to manage student loans to how to budget to manage them as well.
Full disclosure upfront is the best way to help prevent defaults. Set realistic expectations for the prospective student and consel them when they graduate. I know our school does it.
First, it is important to maintain consistent contact and effective follow up with the student throughout the program . We use our lead / record management system effectively to maintain contact.
This includes follow up calls and emails.
Our institution discussions all areas of financial aid with our students or prospective students. The details of what is covered, not covered, grants, scholarships, ect are discussed at their appointments. Financial aid will continue to follow up with our students throughout their program.
