1. Federal Loan Servicing
Brenda Cox, UHEAA/Cornerstone
Wanda Hall, Edfinancial
Matt Stover, Nelnet

2. Federal Loan Servicers
Aspire Resources Inc.
CornerStone
ESA/Edfinancial
FedLoan Servicing (PHEAA)
Granite State – GSMR
Great Lakes Educational Loan Services, Inc.
MOHELA
Navient (formerly Sallie Mae)
Nelnet
OSLA Servicing
VSAC Federal Loans

3. Key Events
March 31st letter from the Department of Education to Senator Harkin
Establish Common Performance Metrics
Incentive Based Pricing
Provide Not For Profit Servicers Additional Volume
Move Towards Comparable Portfolios Across Servicers

4. Key Events
June 9th 2014 – President Obama Delivers Speech on Student Loan Debt
Expands the Pay As You Earn Program
Focus on borrower satisfaction and repayment
Negotiated Rulemaking starts in early 2015 to expand Pay As You Earn

5. Metric Changes
Contract changes incorporated into Title IV Additional Servicers (TIVAS) and Not For Profit Servicers (NFPs) servicing agreements
All Federal servicers will be measured under a common set of performance metrics

6. Outreach Third-Party Debt Relief companies
In grace period and owe more than $25K
Delinquent borrowers
days delinquent
days delinquent
Undergraduate borrowers with higher-than-average debts
> $50K and entered repayment prior year
Borrowers in deferment and forbearance because of financial hardship or unemployment

7. Outreach Campaign target outcome: Visit repayment estimator tool
Improve awareness of IDR
Increase application and adoption of IDR plans
Reduce borrower delinquency and default
Visit repayment estimator tool
Apply for IDR
Contact servicer to apply for IDR
80% of opened s opened within 24 hours
Negligible after 36 hours

8. Outreach Preliminary Results 90-180 days delinquent
15.63% made a payment; 2.54% IDR
days delinquent
12.48% made a payment; 2.05% IDR
Owe $50+ and left school within 1 year
36.73% made a payment; 9.41% IDR
Deferment and forbearance
34.61% changed to in repayment
Grace and owed more than $25K
12.94% IDR

9. Trends
Total outstanding student loan debt has more than doubled since 2007 by approximately 85%
Outstanding student loan debt has shifted from FFEL to Direct Loans
2007 DL 21%
2014 DL 62%
2014 Release of FSA Data by IHEP

10. Trends
Majority of outstanding loans/borrowers are currently in repayment
Grace 5%
Repayment 58%
Deferment 14%
Forbearance 13%
Loan dollars in default 10%
In loan dollars

11. Trends 13% of borrowers enrolled in IDR
Standard repayment 10 years or less: 61%
Standard repayment more than 10 years: 9%
Graduated more than 10 years: 2%
Income-driven: 13%
IBR 9%
ICR 3%
PAYE 1%
Alternative: 2%
Other: 3%
By Borrower

12. Trends 74% of Direct Loans in repayment are being repaid
Nearly ½ of loan dollars not paid on-time are less than 91 days delinquent
Current repayment 37%
31-90 days delinquent 3%
days delinquent 2%
days delinquent 1%
days delinquent 1%
Transferring to DMC <1%

13. Standardization Efforts
Interest capitalization
Due diligence
SCRA
Credit reporting
Payment application
Reaffirmation letter
Proof on income documentation

14. Customization ONE-SIZE DOESN’T FIT ALL Portfolio analysis
Technology available
Borrower demographics
Age of portfolio
Age of borrowers
Where reside
Type of school attended
Length of attendance

15. Customization To Better Serve Borrowers
Edfinancial Services
IDR campaigns – s and postcard reminders of need to recertify for IDR (upcoming or past)
notification that received correspondence
notification that processed correspondence
Delinquency driven and call campaigns
Age driven correspondence – “New and Edgy”
100 Club – All hands on deck – Own accounts

16. Customization To Better Serve borrowers
Nelnet
Borrower communication channels
Enhanced communication
Document submission capabilities
Web/Mobile interfaces

17. Customization To Better Serve Borrowers
UHEAA/Cornerstone
Borrower Centric
Targeted Communications
Innovation & Resource Usage
Quality Control
Training & Professional Development

18. NFP’s Eligibility for common origination and disbursement (cod)
FSA Change Request Outlined Requirements
Intersystem Testing Scheduled Beginning Fall
Servicers Begin Receiving New Loans in January
Small Initial Allocation Pool

19. Consolidation update New process starting January 1st, 2014
Joint session between TIVAS and GA community to discuss issues.
Issues must be addressed when moving from one provider to multiple providers

20. Consolidation update
Inclusion of collection costs if the LVC is not received.
Invalid fields or naming conventions causing file load errors.
Pending changes for overpayments.

21. Total and Permanent Disability Discharge (TPD) Update
Since July 1, 2013 (effective date of new regulations)
Intents to apply – 299K
Application initial review – over 226K
Outgoing correspondence – over 1.5M
Borrowers approved – over 162K
New SSA method for qualifying for TPD has represented % of the monthly FSA approvals

22. Thank you!