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Lenders and Schools Contact:: Default Prevention Management Plan ::
Lowering your school’s Cohort Default Rate (CDR) begins with a Default Prevention Management Plan. Developing your plan can be a significant undertaking; however, by following the steps outlined below, you can create a plan that meets your institution’s specific goals and needs.
Step One: Perform a Cohort Analysis
- To effectively target your default prevention efforts, we’ll need to know which of your borrowers are at a higher risk of defaulting.
- What are some of the characteristics of these students? Did they withdraw before finishing their degree program? Are they enrolling late? Are they focused in specific academic programs? The more data you can gather, the more accurate your analysis will be.
- OCAP offers a Cohort Analysis service for no charge to all Oklahoma schools. We encourage you to involve your Institutional Research office also for a more comprehensive analysis.
Step Two: Get Campus-Wide Involvement
- All schools that want to lower their CDR should assemble a default prevention task force.
- Start with members of your campus community who understand that default prevention is the responsibility of the whole campus, not just the Financial Aid office.
- After you have a few members who understand the school’s default prevention obligations, you can work to educate others on campus and get them on board. Seeking individuals from Financial Aid, Admissions, Academic Advising, Student Life, Academic Affairs, Retention, the Registrar’s office, the Provost’s office, faculty, IT, Institutional Research and the student body is a good place to start.
Step Three: Identify Existing Efforts
- What are you currently doing campus-wide that applies or can be easily adapted to default prevention?
- Loan counseling, financial literacy, student retention efforts are some common examples of activities that many campuses already employ.
- Compare this list of activities to the data from your cohort analysis. Are you reaching the borrowers who need this information the most?
Step Four: Determine Who You Will Target
- Next, we’ll work together to determine who you’ll want your efforts to target. Does it make more sense to target current students? Students in their grace period or repayment?
- From which cohort year will you work and how many days delinquent will be the focus of your plan?
Step Five: Figure Out How To Reach Your Audience
- Will you send letter or emails? Will you initiate a call campaign for delinquent students?
- Do you have enough staff or time to complete this work or will you hire a third-party to help?
- You may need to consider different approaches for current students than the ones you use to reach borrowers in repayment.
- Remember, you can’t help borrowers you can’t reach. We can help you put together a plan for maintaining good contact information on your students.
Step Six: Create Measurable Goals
- Track your progress by creating measurable goals. To ensure everyone on the task force is clear about the goals and in the interest of getting buy-in, it’s critical that your task force work together during this step.
- Many goals will be tied to a specific number or percentage. For example, indicating that you will successfully contact a certain percentage of your delinquent borrowers by telephone.
- Not all goals require a specific number or measurement. Your goals can include “yes/no” statements. This might be appropriate if you're introducing a new initiative or adding a step to your loan counseling process. For example, if you wanted to incorporate in-person loan counseling as a part of your SAP Academic Plans, you could simply include that in your list of goals.
Step Seven: Review Your Plan
- Your committee should review your plan at least once per year.
- It might be appropriate to review portions of your plan on a cyclical basis. For example, you might review your loan counseling goals a few weeks after the start of a term, when most borrowers will have completed loan counseling.
- Use this time to analyze what worked and what didn’t, and identify ways to tweak your plan to make it more successful.
