INDIANAPOLIS, May 25 /PRNewswire/ -- USA Funds®, the nation's leading guarantor of federal student loans, has announced the recipients of its 2010 Excellence in Debt Management awards. USA Funds has recognized the following four postsecondary institutions for their efforts to promote financial literacy and help their students minimize and manage their student loan debt:
Award of Excellence: Contra Costa College — This California community college serves more than 6,800 students. Approximately 90 percent of the students receive some type of financial aid. With just four permanent employees, the financial aid office has cross-trained its staff to provide individual loan counseling to student loan borrowers and offer financial aid lab hours for additional assistance. Financial aid staff members educate students about their student loan rights and responsibilities, scholarship and work-study options, and the importance of personal finance practices, such as budgeting. Contra Costa uses USA Funds' Web-based tools — including USA Funds Life Skills®, USA Funds Loan Counselor® and USA Funds Debt Manager® — to assist with financial literacy, loan counseling and default prevention. A Web-based debt management course is incorporated in the student loan program at the school. The financial aid staff also distributes a bi-monthly financial aid newsletter with key financial aid updates, money-saving tips, student finance management events and information encouraging students to access debt management resources on the school's website, which soon will include a new student portal. Collaborating with faculty and other student services departments, the office also offers money management workshops to specialized student populations. As a result of these efforts, the 2007 cohort default rate for the college dropped to 9.8 percent, down from 20.3 percent in 2003.
Award of Merit: Keiser University — This career college, which has campuses throughout Florida and an online program, prepares students for careers in health care, business, biotechnology, computers and technology, culinary arts, education, and legal studies. Keiser's default prevention program incorporates in-person events, presentations and seminars to reach its 15,000 students. Before launching the program, the financial aid staff visited every campus to obtain staff and faculty commitment by explaining the impact of the school's default rate. Campuses also were encouraged to host Grad Days, a program that celebrates graduates' achievements with a luncheon where students also complete all necessary paperwork for academics, student services and financial aid. Leadership Distinction, a joint effort with the student services department, encourages students to attend seminars to earn a certificate of completion, a letter from the campus president and honor cords at graduation. Students also receive a folder created specifically for default prevention and debt management materials provided during the presentations. Since October 2009, more than 1,500 students have participated in the seminars, which are required for graduation. Keiser also contracts for additional default prevention services. In one year, the school's default rate has dropped nearly 2 percent as a result of its default prevention efforts.
Award of Merit: Automeca Technical College — This private technical school, located in Puerto Rico, was required to develop a default prevention plan to address its student loan default rate. To help faculty understand the importance of the program, the school offered a cash management and finance session to staff first, and then introduced the material to students through sessions offered six times each semester. As part of the plan, loan counseling helps create a better awareness of student loan debt and encourages students to borrow only what they need for educational expenses. Students also are provided with contact information to address any student loan problems — especially locating loans that have been sold. As a result of these efforts, the school reduced its cohort default rate by nearly 10 percentage points, to 16.3 percent from 25.6 percent, in just one year.
Award of Merit: Rasmussen College — This school offers degrees in more than 70 programs both online and through its network of 18 campuses. Five default management specialists counsel the more than 15,000 students on personal finance issues and loan repayment options through in-person and online loan counseling. The default management department is divided into two divisions. The data management team contacts borrowers entering repayment and borrowers in the early stages of loan delinquency. The aversion team is responsible for counseling borrowers with past-due loan payments and conducting skip-tracing activities. Student loan borrowers receive financial management and budgeting information, and students become familiar with the default prevention and financial literacy programs during on-campus activities. A database created internally contains borrower names, loan status, demographics and important due dates. Specialists also send out monthly mailings, postcards and e-mail communications to borrowers, and spend nearly 30 hours per week making phone calls to discuss repayment and other options. A quarterly survey helps the school proactively address issues to improve student retention. Rasmussen currently is developing a plan to incorporate social media tools into the mix. The team's efforts have reduced the school's default rate by 2 percent during the most recent cohort period.
"The inventive and effective debt management initiatives of these four institutions have demonstrated positive results in preventing student loan defaults," said Denise B. Feser, USA Funds senior vice president, customer relations. "Promoting responsible borrowing and teaching students to become smarter consumers will help them better manage their education expenses and control their finances after graduation."
USA Funds presents its Excellence in Debt Management Awards annually to highlight outstanding campus debt management and financial literacy programs and to disseminate to other postsecondary institutions best practices in debt management and student loan default prevention.
USA Funds' staff and representatives of schools that received debt management excellence awards in 2009 selected this year's recipients.
Headquartered in Indianapolis, USA Funds is a nonprofit corporation that works to enhance postsecondary education preparedness, access and success by providing and supporting financial and other valued services. For more information about USA Funds, visit www.usafunds.org.
SOURCE USA Funds