In our last blog we discussed the importance of reviewing your draft CDR data and using the eCDR Appeals application to challenge incorrect data. This process is time consuming and at a time of year when your office is likely busy reading applications for enrolled students. So, wouldn’t it be nice to have confidence that your draft data is accurate every year? That’s not a pipe dream. Tools are available to help you manage your CDR all year, you just need to dedicate resources to implement them.
NSLDS enrollment reporting is a critical element of this process. The most common ‘error’ found in the draft data is an incorrect separation date. Since this date is used to determine when the borrower must begin repaying their loan, it has a direct impact on the timeframe for defaulting and it may even put the borrower in the wrong cohort all together. If your institution updates NSLDS less frequently than monthly, it increases the likelihood of outdated enrollment data being used, particularly if you offer non-traditional programs with short modules where a student can take a leave of absence and return before using the grace period of their loan.
Wouldn’t it be great if you could identify and help delinquent borrowers before they even default? Or how about being able to review and correct data about the borrowers likely to appear in your draft Loan Record Detail Report? NSLDS has canned reports to help you do both. The Delinquent Borrower Report (DELQ01) provides a list of borrowers who have been reported as delinquent in making loan payments to one of the federal loan servicers. While the School Portfolio Report (SCHPR1) provides information about all Direct Loan and/or FFEL program loans for a specified school. You can set up subscriptions and have these reports delivered to your SAIG mailbox at the interval of your choosing.
These reports will be helpful to initiate two different activities that will help to make the CDR draft period easier to manage. First, regular review of this data will identify and give you the opportunity to correct erroneous data like incorrect separation dates or loans that should have been cancelled. Additionally, you can do outreach to delinquent students to help them avoid defaulting all together or counsel defaulted students so they can get into a rehabilitation agreement timely and be back in good standing before the end of the monitoring period.
Outreach doesn’t necessarily have to be phone calls and long counselling sessions. If you have the resources to do that, great! If not, consider sending a brief email or snail mail message (using automation in your Financial Aid Management system if you can), referring borrowers to a resource where they can find assistance, like their loan servicer or Federal Student Aid’s website. Investing in this activity not only helps to maintain a lower CDR but also creates good will among your former students who are feeling challenged by student loan repayment.
Another option is to use a third-party servicer to do the outreach. This is often an expensive prospect. However, if you have a lot of borrowers to review/manage or if your CDR is high enough to be a concern, the cost is justifiable. The most common arrangement entails your institution authorizing the third-party servicer to access NSLDS data to identify delinquent borrowers while there’s still time to avoid default. The third-party servicer will likely even be able to do skip-tracing to find borrowers with bad physical or email addresses and phone numbers. Borrowers don’t always remember all the repayment options they learned about in exit counseling and when they can’t afford their payment, it’s common to practice avoidance. When borrowers understand their options and their rights, it empowers them to ask for what they need from their loan servicers to stay on track.
If your office doesn’t support any of these activities currently and farming out the work is not an option, start small. Making the time to review NSLDS reports monthly to identify students with incorrect enrollment dates is a good place to start. You can also see about using an existing vehicle to get out a very general message about loan repayment resources, like your institution’s alumni magazine or newsletter.
For more CDR management options, check out Chapter 3.2 of the Cohort Default Rate Guide.
The Higher Education Assistance Group is here to support you no matter what your CDR management needs may be. Visit our website to learn about our training and compliance assistance resources or email us at Info@heag.us and let us know how we can help.