Student Loan Ombudsman Caucus: Creative Solutions for Loan Problems

1. Session #16 Introducing the Student Loan Ombudsman Caucus: Facilitating Creative Solutions for Student Loan Problems and Issues Grace Bartini, American Student Assistance Corporation Debra Wiley, Federal Student Aid, U.S. Department of Education

2. Background Federal Student Aid Ombudsman • 1998 - Federal Student Aid Ombudsman established by HEA Amendments • 1999 – First case accepted (erroneous default) • 2007 – More than 17,000 cases

3. 1999 - 2006 Federal Student Aid Ombudsman and Agency Contacts • 1999 - Designated High Level Contacts at Guarantor and Lender Agencies Assist With Case Resolution • 2001 – First Annual Meeting of Ombudsman Contacts • 2006 –Student Loan Ombudsman Caucus Charter • 2007 –Caucus Operational

4. A Student Loan Ombudsman Caucus Emerges… Agency Contact Agency Contact Agency Federal Contact Student Aid Ombudsman Agency Contact 1999 - 2006

5. A Student Loan Ombudsman Caucus In Action… Agency Contact Agency Contact Student Loan Ombudsman Caucus Agency FSA Ombudsman Contact Agency Contact Student Aid Industry: Trends, Issues, Training, Outreach, and Communication 2007 Multi Directional Exchanges à

6. Why a Caucus? • Enhanced Student Aid Problem Resolution Network • Promotes Consistent Use of Ombudsman “Best Practices” • Targeted Training and Mentoring • Improved Trends Identification, Analysis and Reporting

7. How Does The Caucus Operate? • Conference Calls • Quarterly Meetings • Committee Structure • Members’ ListServe

8. …How Does the Caucus Operate? Caucus Members… • Use all available information to recommend and promote areas of research • Advise membership on areas of mutual interest • Utilize individual and collective reports to analyze potential for improvement

9. …How Does the Caucus Operate? Each agency ombudsman works to resolve problems identified through the Federal Student Aid Ombudsman or from within the agency As a Caucus member, the agency ombudsman participates in the discussion of student loan issues, feedback on student aid legislation, case trend analysis and recommendations for change

10. How Do Students Benefit? Caucus Members Commit To: • Serving as a voice for fair process • Coordinating with student loan stakeholders and the government to promote positive change in the student loan industry • Learning from complaints and problems that impact student loan borrowers, and prevent them when possible

11. ….How do Students Benefit? • Caucus members provide an in-agency escalation process for problems • If problems remain, students call Federal Student Aid Ombudsman at 1-(877) 557-2575 • Federal Student Aid Ombudsman will work with the student and the agency • Federal Student Aid Ombudsman and Caucus member will use the situation to inform change

12. How do Schools Benefit? • Additional resources to assist borrowers during enrollment, or after they leave your campus • You, student, agency and Federal Student Aid Ombudsman work together to research and resolve an individual question • Outcome on the individual situation informs the whole. For example…

13. Case Analysis and Reporting Trends Identification and Reporting = Collaborative Resolution = Change Federal Student Aid Ombudsman groups cases in 16 basic issue categories Cumulative and Individual Agency Reports Are Produced Annually Student Loan Ombudsman Caucus can concentrate on select issue categories, and compare agency experiences to Federal Student Aid Ombudsman data

14. Account Balance Bankruptcy Closed School Collection Practices Consolidation Credit Reporting Default Deferment/Forbearance For Example…..The Basic Categories Help Define Where Difficulties Arise FSA Assistance Loan Cancellation NSLDS Repayment Plans/Amounts Service Quality Student Eligibility Tax Refund/Offset Wage Garnishment

15. Top 5 Research Issues • Initially, the top 5 issues accounted for about 60% of the Federal Student Ombudsman research cases. • Now, the top 5 issues account for about 70% of research cases. Consolidation Loan Cancellation/Discharge Account Balance Repayment Plans/Amounts Default

17. The Caucus Can Concentrate An Issue Review………….For Example • Consolidation Is The Number One Issue for Federal Student Aid Ombudsman Cases in 2007 • Caucus Members Assist in Resolving Questions About Consolidation at Their Agency • Collective Information Promotes Compliance and Corrective Action • Caucus Members and Federal Student Aid Ombudsman Use Case Questions To Inform Student Consumer Information: http://www.ombudsman.ed.gov/consolidation.html

18. The Caucus Can Commit to Effective Problem Resolution Caucus commitment promotes…. • accurate, and consistent customer service • common-sense approaches • creative solutions • collective review of outcomes

19. For Example…….Reminders From a Caucus Member • Let the customer tell the full story • Try to understand the customer’s point • Give the customer your undivided attention • Explain circumstances in context of the customer’s specific needs • Give realistic time frames for action • Use the information to check internal systems and escalation processes

20. Shall We Try It?Group Resolution of case samples

21. What’s Next…..

22. A Student Loan Ombudsman Caucus In Action… Agency Contact Agency Contact Student Loan Ombudsman Caucus Agency FSA Ombudsman Contact Agency Contact Student Aid Industry: Trends, Issues, Training, Outreach, and Communication 2007 Multi Directional Exchanges à

23. Benefits Predicted from Caucus Activities….. Multi-prong problem identification, resolution, and change recommendation Will help encourage and promote: • Resolution versus reaction • Prevention instead of correction • Systemic change

24. Contact Information We appreciate your feedback and comments. Contact us: Grace Bartini, Ombudsman American Student Assistance Corporation Telephone: (800) 999-9080 , ext 4512 E-mail: bartini@amsa.com Debra Wiley, Ombudsman, Federal Student Aid, U.S. Department of Education Telephone: (202) 377-3800 Facsimile: (202) 275-0549 Website: www.ombudsman.ed.gov E-mail: debra.wiley@ed.gov