RFI /RFP Guidelines

1. RFI/RFP Guidelines Provided by CLFE CASFAA2008, December 8, 2008 Anaheim , CA Presented by, Thalassa Naylor, Sallie Mae

2. Why have a lender list? • For your students • Competition encourages quality improvements and good service • Choice – ability to pick the best lender for them • Protection from predatory lenders • For your financial aid office • Lenders that use your preferred process • Lenders that you have pre-screened for service and other important factors • Control your office time investment

3. RFI or RFP? Request for Information (RFI) Request made during the project planning phase where a buyer still may need to identify product requirements, specifications, and purchase options. RFIstypically indicate that award of a contract will not automatically follow. Often followed by RFP. Request for Proposal(RFP) An invitation for providers of a product or service to bid on the right to supply that product or service to the individual or entity that issued the RFP.

4. Why do an RFP? To ensure fairness in lender selection and create an audit trail for federal compliance To find lenders that use your school’s preferred process To find lenders that offer the best quality products and services for your students To ensure that you are providing your students with a list of committed and reputable lenders

5. The RFP Process Planning Survey Development Solication Scoring/Selection Notification

6. Planning Planning is bringing the future into the present so that you can do something about it now. - Alan Lakein, time management expert Begin with the end in mind. - Stephen Covey

7. Planning RFP Committee • Draw from more than just the financial aid office – others with a vested interest in the end results. • FA Office • Business Office/Bursar • Student Representative

8. Planning • DefineTimeline • When do you need to have your lender list? • How much time to do you need to prepare? • How much time do you need to review? • Build in a recommended 6 weeks for lenders to respond (less than 4 is challenging for lenders if you want quality responses)

9. Planning 1/1 – 1/15 1/16 – 2/28 3/1 – 3/14 3/15 Plan List Respond Eval Planning & Development Lender Response Time Evaluation Decision

10. Planning Selection Criteria What factors will you use to select your lenders? What is most important to the institution? What is most important to the your students More on this later…

11. Planning Develop a scoring methodology Creating a way to score the responses is important: a numeric way to compare lender responses that is less likely to be subjective. You can weight more heavily things that are of more importance

12. Planning RFI Structure Clearly numbered response questions will ensure every response can be compared Organization of questions by topic ensures focused responses and makes review easier Online/electronic response vs. paper Supplemental requested materials

13. Survey Development • Define how you want to base your decision and build survey around these criteria. For example: • Lender stability and commitment • Customer Service • Process Flow • Specific Products Need • Debt Management/Default Prevention • Other criteria

14. Survey Development General Lender Information • Stability and financial strength • how will they fund the loans • short and long term financial positioning • Experience in Student Lending • Commitment (what do they do beyond just the loan?) • Financial literacy • Outreach • Scholarships • Philanthropy and CommunityService

15. Survey Development Customer Service Borrower service experience School service & support Online options Collateral and information Financial Literacy and Education Debt Management Default Prevention

16. Survey Development Platform & Processing • Define your preferences • Can lenders use your preferred process? • If not, what is their process? • Guarantor choice • Borrower application process • Loan delivery • Servicing

17. Survey Development Possible FFEL Topics Funding stability Guarantor partners Borrower benefits* Debt management & default prevention Other value added services PLUS Servicing * Loan Sales * *may be irrelevant in current market

18. Survey Development Possible Private Loan Topics Eligibility Criteria Pricing Borrower benefits Customer service Repayment options Cosigners Program specific loans Debt management & default prevention

19. Solicitation Invitation to Respond/Communication • Provide complete information on when, how, to whom, supplemental materials required. • What’s in it for the lenders? • total volume for each loan product • # oflenders tobe selected • Length of placement

20. Solicitation Getting invitations out to lenders: ListServ (ie. CASFAA) Personal invitations to lenders – hard copy or electronic (preferred) CLFE

21. Scoring, Review and Selection Each response received should be run though your scoring and review model developed during planning. Any follow up or clarification requests should be determined quickly so lenders can respond. Select your final list of lenders!

22. Notification • Notify all selected lenders promptly in writing (email is fine). • Notify all non-selected lenders promptly in writing (email is fine). • If possible, provide those not selected with reasons for non-selection. Assists them in understanding where they are not competitive, where they didn’t meet your processing criteria, or where they can improve.

23. Remember Include at least three unaffiliated lenders (not same ownership). Disclose that borrowers have the right to choose any lender, including lenders that are not on the lender list. disclosing the criteria used to select the lenders on the lender list (this can be generically stated ie. Best customer service, met our institutions processing flow standards). reviewing the lender list frequently

24. The following CLFE members indicate they provide support, tools or resources for developing an effective lender RFP. • Great Lakes GreatLakesRFPTeam@glhec.org • Sallie Mae http://www.salliemae.com/schools/financial_aid/straight-talk/seven-steps.htm • TGSLC List Assist http://www.tgslc.org/products/listassist/ or contact TG’s Lender Consultant team at lenderrequests@tgslc.org • Total Higher Education (T.H.E.) http://www.theloanprogram.org/FAO/lenderpartners.aspx or contact Lacey Carter at lcarter@theloanprogram.org • USA Funds contact your USA Funds representative or Brent Dove at brent.dove@usafunds.org

25. CLFE Resources For the latest updated information, please go to our website at www.CLFE.org Thank you!

26. Acknowledgements This presentation and information compiled by the CLFE RFP Committee: • Thalassa Naylor, Sallie Mae • Lacey Carter, Total Higher Education • Kim Thomas, National Student Loan Program For more info and a more detailed document containing this information, please visit our website at www.CLFE.org