NYSFAAA 43 Annual Conference“Helping Students Catch Their

Dreams”October 20, 2011

Christopher Alonzo- MCCJan Scheutzow- Nazareth College

Dorcia Ulysses-Diallo- SUNY Geneseo

Direct Loan Entrance Counseling◦ Delivery Options◦ Counseling Requirements◦ Best Practices

Direct Loan Exit Counseling◦ Delivery Options◦ Counseling Requirements◦ Best Practices

Perkins Entrance Counseling◦ Delivery Options◦ Counseling Requirements◦ Best Practices

Perkins Exit Counseling◦ Delivery Options◦ Counseling Requirements◦ Best Practices

TEACH Grant Exit Counseling

◦ Must be completed prior to first disbursement of Stafford loans to first-time loan borrowers

◦ May be conducted in person, by audio visual presentation, or by interactive electronic means. www.studentloans.gov www.mappingyourfure.org Direct Loan Entrance Counseling brochure

(http://www.direct.ed.gov/pubs/entrcounselguide.pdf)

◦ School must document completion of counseling

Comprehensive loan information◦ Terms and conditions

Current interest rate, grace period, first payment due date◦ Rights and Responsibilities

Explain the use of the Master Promissory Note◦ Multi--year feature

Explain interest and capitalization◦ How interest accrues and is capitalized◦ Option to pay unsubsidized interest while in school

Review repayment options◦ Standard, Extended, Graduated, Income-Based Repayment,

Consolidation

Provide sample monthly repayment amounts◦ Based on average Stafford indebtedness of students at the same

school

Stress importance of repayment

Stress repayment is required regardless of educational outcome or employability

Review deferments and forbearance

Describe consequences of default◦ Adverse credit, collection costs, ineligible for deferments,

seizure of state or federal tax refund, ineligibility of FSA funds

Provide NSLDS information

Provide school contact for questions

Stress importance of keeping the school/servicer informedof name, address, enrollment changes

Stress importance of good record keeping

Discuss budgeting

Remind borrower of Exit Counseling

Panel discussion of SUNY, Private and Community Colleges

◦ Must be completed before Stafford and Grad PLUS borrowers graduate, withdraw or drop below ½-time status Upon withdrawal, must be sent within 30 days

◦ May be conducted in person, by audio visual presentation, or by interactive electronic means www.studentloans.gov www.mappingyourfure.org Direct Loan Exit Counseling brochure

(http://www.direct.ed.gov/pubs/exitcounselguide.pdf)

◦ School must document completion of counseling

Review information from entrance counseling◦ Consequences of default

Adverse credit, collection expenses, litigation◦ Importance of repayment obligation

Regardless of dropping out, ability to find a job, or satisfaction with program

◦ Use of Master Promissory Note

Review repayment options◦ Standard, Extended, Graduated, Income-Based, etc

Review plan features, sample payments, interest charges, total payments

Review option to prepay without penalty and change repayment plans

Provide an average anticipated repayment amount on:◦ His/her indebtedness◦ The average indebtedness of other student borrowers at the same

school or in the same program

If the student has taken out..

Average should be based on students who have borrowed

DL Sub/Unsub only DL Sub , Unsub only

DL Sub, Unsub and Grad PLUS

DL Sub, Unsub and Grad PLUS

Provide loan consolidation information◦ Effects of consolidation on total interest to be paid, option or

prepay the loan or change repayment plans.

Discuss debt management strategies and tax benefits

Review forbearance and cancellation options

Inform student of NSLDS loan information

Inform student of FSA Ombudsman Office

Ensure borrower understands their rights and responsibilities

Collect and update personal and contact information◦ Must send to DL Servicing within 60 days of exit

School must document compliance of exit counseling

Panel discussion of SUNY, Private and Community Colleges

◦ Must be completed prior to first disbursement of Perkins loans for the award year

◦ May be conducted in person, by audio visual presentation, by interactive electronic means, or by a third party provider www.mappingyourfure.org Campus Partners

◦ School must document completion of counseling

Rights & Responsibilities under Perkins Loan Program

Loan is for educational purposes only

Loan must be repaid and the school holds the MPN◦ Must notify student the amount of each Perkins disbursement

made under the MPN, option to cancel disbursement or the loan

Name & address of school to which debt is owed

Name & address of servicing agent

Maximum annual and aggregate loan amounts

Effect of accepting Perkins loan on other types of student aid

Total Perkins indebtedness and estimated monthly payment

Perkins consolidation and refinance options

Notice of Dept. of Defense program for repayment based on certain military service

Complete list of Perkins charges – deducted or paid separately

School will report balance of loan to national credit bureau annually

Collect updated borrower information◦ Name, address, phone, spouse, employer, references

Panel discussion of SUNY, Private and Community Colleges

Completed prior to student graduating or drops below ½-time status

May be done in person, in groups, by audiovisual presentation, by interactive electronic means, or by third parties

Upon withdrawal- exit material must be mailed within 30 days of notice of withdrawal

Disclose pertinent repayment information

Contact information to request a copy of MPN

Contact information for school

Contact information for servicer

Name and address to whom payments should be sent

Estimated amount owed and repayment begin date

Total interest charges paid per repayment schedule

School must document Perkins exit completion

Panel discussion of SUNY, Private and Community Colleges

Panel discussion of SUNY, Private and Community Colleges

2009-2010 Federal Handbook◦ Volume 2; 2-80 to 2-84◦ Volume 6; 6-62 to 6-63; 6-111 to 6-113