Campus-Wide Commitment, Analysis Top Default Prevention Tips

Submitted by: Shannon Cross, USA Funds Account Executive

A report issued over the summer looks at default prevention strategies at community colleges. But the report’s findings and recommendations highlight best practices that all types of institutions should review and consider implementing.

“Protecting Colleges and Students: Community College Strategies to Prevent Default,” from the Association of Community College Trustees and The Institute for College Access & Success, lists the following recommendations for colleges:

1. Embrace default reduction as a campus-wide endeavor. “Confining default reduction efforts to the financial aid office makes little sense given both the relationship between default and student success and the importance of federal aid eligibility to the institution as a whole,” the report says.
2. Analyze who borrows and who defaults. “Protecting Colleges and Students” says, “Data analysis can uncover the unique characteristics and behaviors of a college’s population, and help target services towards the borrowers who need them most.”
3. Provide counseling and information to borrowers when they need it. Your data analysis should guide the tactics you use for borrower outreach, the report advises.

I recommend a life-of-the-loan approach to borrower counseling and outreach. Based on what your data analysis indicates could be most effective, your work can range from messages in weekly school bulletins and kiosks on campus, to in-person exit counseling, to targeted outreach by phone and email once borrowers leave.

Visit the USA Funds^® website at www.usafunds.org if you need assistance with cohort management, borrower outreach, and financial literacy and student success training.