Loan Servicing Overview

Report
DEPARTMENT OF EDUCATION LOAN
SERVICES
July 17, 2012
Anthony Lombardi
WFAA Summer Workshop
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Confidential and proprietary information © 2012 Sallie Mae, Inc. All rights reserved.
Confidential and proprietary information © 2012 Sallie Mae, Inc. All rights reserved.
Department of Education Loan Services
Sallie Mae Does Everything To Help
Students Succeed and Effectively Pay
Back and Manage Their Loans
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Confidential and proprietary information © 2012 Sallie Mae, Inc. All rights reserved.
Department of Education Loan Services
Today’s Agenda-
Contacting Us & Resources for Schools
► Resources for Borrowers
► Loan Servicing Overview
► Default Prevention
► Current Hot Topics
► Questions & Next Steps
►
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Confidential and proprietary information © 2012 Sallie Mae, Inc. All rights reserved.
Department of Education Loan Services
Contacting Us and Resources for Schools
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Confidential and proprietary information © 2012 Sallie Mae, Inc. All rights reserved.
Department of Education Loan Services
Contacting Us
Sallie Mae keeps schools informed through: E-mail, CollegeServ call center
representatives, Our “Servicing” Website, Sales and ED Contract
Management Meetings, Training Webinars, OpenNet, and as part of our
participation at over 40 financial aid conferences each year.
CollegeServ
►
►
►
Answers questions, provides assistance & reports
Answers cohort agency status questions
Provides training and support for OpenNet
CollegeServ
1-888-272-4665
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Confidential and proprietary information © 2012 Sallie Mae, Inc. All rights reserved.
Department of Education Loan Services
Contacting Us
Sallie Mae-Dept of ED Loan Services
NSLDS Servicer Code: 700578
Student and Parent Phone ED: 800-722-1300
Student and Parent Line Commercial: 888-2SALLIE (888-272-5543)
Hours: M-TH 8:00am – 9:00pm F 8:00AM – 8:00PM (EST)
Web: www.salliemae.com
CollegeServ: Dedicated group of representatives specifically trained to support
Sallie Mae's school customers for all ED and non-ED related inquiries
School Phone: 888-2SCHOOL (888-272-4665)
Hours: M-F 8:00am – 8:00pm (Eastern Time)
Web: www.opennet.salliemae.com and www.salliemae.com/EDServicing
E-mail: [email protected]
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Confidential and proprietary information © 2012 Sallie Mae, Inc. All rights reserved.
Department of Education Loan Services
Resources for Schools - OpenNet
OpenNet – school portal for borrower and loan
inquiries
►
See our OpenNet training page as it has a mix of videos
and documents covering topics like Adding/Updating a
school user, the servicing guide, Granting access to users
(under servicing), Contact Information, and the
FAQ. We also have user guides and info on DDI
Reports.
►
ED-only:
https://www1.salliemae.com/content/doe/docs.html
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Confidential and proprietary information © 2012 Sallie Mae, Inc. All rights reserved.
Department of Education Loan Services
Resources for Borrowers
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Confidential and proprietary information © 2012 Sallie Mae, Inc. All rights reserved.
Customer Communication: Early Outreach
 We provide helpful, relevant and easy to understand
Information on how to:
 Manage their loan account on-line, via the IVR or by a Service Representative
 Take advantage of Electronic Servicing (monthly billing, auto debit, e-mail) options
that can save money (ACH benefit on all ED-owned loans)
 Change to one of many repayment options that best suit their situation
 Receive payment relief
 Maintain the benefits of good credit
 Our Interactive Web Portal “SallieMae.com/BeDebtSavvy” helps students:




Budget for college and repayment
Understand what credit scores and FICO are
Become more aware of issues with credit card debt
Understand the flexibility and benefits of the many loan repayment options
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Confidential and proprietary information © 2012 Sallie Mae, Inc. All rights reserved.
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Customer Communication: Quarterly Interest Statement
 Sent to customers until their accounts enter Repayment
 Includes interest information, loan balance, and anticipated repayment
begin date
 Includes remit slip for customer convenience in case they choose to pay
interest early to avoid capitalization
 Includes information on benefit of paying interest:
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Confidential
Confidential and proprietary information © 2012 Sallie Mae, Inc. All rights
reserved.
and proprietary information © 2010 Sallie Mae, Inc. All rights reserved.
Customer Communication: Exiting School Email
 Key messages
– Automatic debit
– Update address
and phone
– How to make
payments
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Confidential
Confidential and proprietary information © 2012 Sallie Mae, Inc. All rights
reserved.
and proprietary information © 2010 Sallie Mae, Inc. All rights reserved.
Customer Communication: Early Repayment Sample
 Key messages
– Where to get answers
– Planning for successful
repayment
– Online account access
– How much do I owe
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Confidential
Confidential and proprietary information © 2012 Sallie Mae, Inc. All rights
reserved.
and proprietary information © 2010 Sallie Mae, Inc. All rights reserved.
Customer Communication: Monthly Billing Statement
Provides relevant
messages to
help borrowers
at critical times in
the loan life-cycle
to better manage
their account
Links to online
account features
Provides critical
account details
Provides slip to
return with
payment
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Confidential
Confidential and proprietary information © 2012 Sallie Mae, Inc. All rights
reserved.
and proprietary information © 2010 Sallie Mae, Inc. All rights reserved.
Customer Relationships: On-Line Tools
 Login easily accessible
LOG ON VIA WWW.SALLIEMAE.COM
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Confidential and proprietary information © 2012 Sallie Mae, Inc. All rights reserved.
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Account Summary & Transaction Overview
Account Summary provides:
–
–
–
–
–
–
–
–
–
Loan Balance
Interest (capitalized and accrued)
Total amount owed
Past due amount
Late fee(s) N/A for ED
Payment Amount
Due Date
Loan Advisor/Messages
Navigation to
view correspondence,
last three payments,
on-demand printing,
and any borrower benefits
– Other Transactions
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Confidential and proprietary information © 2012 Sallie Mae, Inc. All rights reserved.
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Department of Education Loan Services
Loan Servicing Overview
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Confidential and proprietary information © 2012 Sallie Mae, Inc. All rights reserved.
Department of Education Loan Services
Loan Servicing
Loan
Booking
In School
In Grace
Repayment
Delinquency
and Default
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Confidential and proprietary information © 2012 Sallie Mae, Inc. All rights reserved.
Department of Education Loan Services
Loan Booking  Assignment
When and how is the servicer assigned?
►
►
►
FSA designates the servicer upon the
booking of the loan. Booking occurs when
COD accepts an origination record, links to
the prom note and accepts actual
disbursement.
New borrowers are assigned to Sallie Mae,
Great Lakes, FedLoan, or Nelnet based upon
percentages assigned by FSA.
Borrower Mailed a Welcome Letter within 24
hours of Loan Conversion to our System
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Confidential and proprietary information © 2012 Sallie Mae, Inc. All rights reserved.
Department of Education Loan Services
Loan Booking  Borrower Notices
How do I know which servicer is servicing my loans?
►
When a Direct Loan is assigned to a federal loan
servicer, the servicer corresponds with the borrower.
►
The welcome correspondence notifies the borrower of
the servicer, toll-free phone number, and website
information.
►
Borrower may visit NSLDS.ed.gov to identify their
federal loan servicer(s).
►
Forgot the PIN? Visit PIN.ed.gov
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Confidential and proprietary information © 2012 Sallie Mae, Inc. All rights reserved.
Department of Education Loan Services
In School  Interest Payments
How do I make interest payments on my
unsubsidized loans while I’m in school?
►
Stafford borrowers can securely access their
account and make a payment on
www.SallieMae.com at any time.
►
Sallie Mae sends quarterly interest
statements* while in school or grace.
*email is the only option for these notices.
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Confidential and proprietary information © 2012 Sallie Mae, Inc. All rights reserved.
Department of Education Loan Services
Grace Period  Deferred Repayment (PLUS)
When must I begin repayment on my loan? Do I get a grace
period?
►
Stafford Loans: 6-month grace period begins the day after
they graduate, leave school, or drop below half-time status.
Payments are due after the grace period ends.
►
Grad PLUS: Borrowers can postpone payments while enrolled
at least half time. May also postpone payments for the 6
months after they graduate, leave school or drop below half
time (for loans first disbursed on or after July 1, 2008).
►
Parent PLUS: Can request to postpone payments while the
student for whom they obtained the PLUS Loan is enrolled at
least half time. May also request to postpone payments for
the 6 months after the student is no longer enrolled at least
half time (for loans disbursed on or after July 1, 2008).
Confidential and proprietary information © 2012 Sallie Mae, Inc. All rights reserved.
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Department of Education Loan Services
Grace Period  Entering Repayment
What are the most important things a student should know as
he/she prepares for loan repayment?
Important messages for borrowers as they are leaving school and
entering repayment:
►
►
►
►
►
►
Check NSLDS to identify all federal loans
Provide servicers with updated contact information
Sign up for online account access
Sign up for automatic debit to ensure timely payments and receive a
0.25% interest rate reduction
Call the servicer or visit servicer’s website to obtain information on
repayment options that best meet the borrower’s financial situation.
Sallie Mae offers robust payment plan modeling tools and easy online sign-up for repayment plan options.
Understand that servicers are there to help!
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Confidential and proprietary information © 2012 Sallie Mae, Inc. All rights reserved.
Department of Education Loan Services
Repayment  Deferment
Can I provide my servicer one deferment
form for my ED held FFEL and DL loans?
As a general rule, the FFEL or Direct Loan
Program deferment form is acceptable for
all deferment requests for federally-owned
loans.
► In some cases, a FFEL form must be used
for FFEL program loans and a DL form for
Direct Loans.
►
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Confidential and proprietary information © 2012 Sallie Mae, Inc. All rights reserved.
Department of Education Loan Services
Repayment  Billing
Payment Fees? Late Fees?
No fees on payment methods
► No late fees
► No fees on any other activities associated
with the servicing of federally-owned loans
►
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Confidential and proprietary information © 2012 Sallie Mae, Inc. All rights reserved.
Department of Education Loan Services
Default Prevention
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Confidential and proprietary information © 2012 Sallie Mae, Inc. All rights reserved.
Graduation Lessens the Chance of Default
Default Rates
18%
16.8%
16%
14%
12%
10%
8%
6%
4%
3.7%
2%
0%
Borrowers who graduated
Borrowers who dropped out
Source: Education Sector, Degreeless in Debt
Confidential and proprietary information © 2012 Sallie Mae, Inc. All rights reserved.
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Customer Resolution Services
Focus on The Customer Experience
►
Our Collections Staff encourages and supports staff with coaching and
development based on the following key components:
–
–
–
–
Delinquency Resolution
Counseling
Customer Experience
Compliance
►
Quality directly impacts our staff providing a vested interest to consistently
provide our customers with world class service.
►
Management completes a minimum of 4 random monitors per month for each
agent.
►
Collection’s senior management conducts frequent group listening sessions
each month to ensure consistency and gain a clear understanding of the
impacts to our customer base.
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Confidential and proprietary information © 2012 Sallie Mae, Inc. All rights reserved.
Customer Resolution Services
Technology Used in the Our Business
►
Sallie Mae Servicing Systems
– CARES – Graphical user interface presents account information to agents in an easy to
use format
– CLASS Servicing System - All account activity is documented in this Sallie Mae system of
record
•
►
System logic ensures all due diligence activity is completed as required
Auto-Dialer
– Blended auto-dialer environment with capability for high volume calls
►
Collection Strategy
– Strategy team provides ongoing analysis and modeling for all stages of delinquency
– Strata decision engine used to assign delinquent accounts to strategic dialing campaigns
– Targeted letter, email, and text message campaigns
►
Vendor Activities
– The skip tracing division’s process is enhanced with the use of CLASS automation that
enables import transactions with commercial vendor batch data
►
Quality Monitoring
– NICE – Call monitoring system used to record calls for training and quality feedback
purposes
Confidential and proprietary information © 2012 Sallie Mae, Inc. All rights reserved.
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Customer Resolution Services
Contacting the Borrower
►
Sallie Mae’s collection practices are designed to maintain and exceed, at all times,
the student loan collection standards set forth by the U.S. Department of
Education.
►
Upon reaching the 15th day of delinquency, intensive default prevention campaigns
are executed by Customer Resolution Services.
►
Collection activities are performed at the borrower level. For borrowers who have a
combination of loan types or guarantee agencies, collection activities are no less
rigorous than the most stringent guarantee agency’s requirements.
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Confidential and proprietary information © 2012 Sallie Mae, Inc. All rights reserved.
Customer Resolution Services
Collections Due Diligence and Calling Strategy
(Collection Strategies and Activities are Subject to Change)
ED Owned
Default @ 360
Tel = 2-3 days
UPS Letter @ 330
Testing @ ~ 330
Dedicated
Collector assigned
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Confidential and proprietary information © 2012 Sallie Mae, Inc. All rights reserved.
Department of Education Loan Services
Hot Topics
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Confidential and proprietary information © 2012 Sallie Mae, Inc. All rights reserved.
Hot Topics
Income Based Repayment Options
► Serial Transfers
► Special Direct Consolidation Loan
Opportunity
► Interest Capitalization
► Forbearance – 36 month continuous cap
► Cohort Default Rates
► CDR Appeals
►
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Confidential and proprietary information © 2012 Sallie Mae, Inc. All rights reserved.
Customer Resolution Services
Questions?
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Confidential and proprietary information © 2012 Sallie Mae, Inc. All rights reserved.
Contacts
CollegeServ 1-888-272-4665
Anthony Lombardi 206-200-8815
[email protected]
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Confidential and proprietary information © 2012 Sallie Mae, Inc. All rights reserved.

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