Transcript Document

Student Lending Analytics
Flash Survey Update: FFEL and Direct Lending Trends
March 15, 2010
This presentation does not constitute formal policy or legal
advice and should not be relied upon as such.
© Student Lending Analytics, LLC
Slide 1
SLA Flash Survey: FFELP and DL Trends
Background
Situation
– Student aid bill may be part of reconciliation package with
health care overhaul which could be voted upon as early as
this week
Survey Goals
– Determine where schools are in the decision-making process
when it comes to the federal student loan program for 201011
– Identify steps that schools have taken to prepare for a
potential transition to the Direct Loan program
– Generate ideas for improving the implementation process for
the Direct Loan program
© Student Lending Analytics, LLC
Slide 2
SLA Flash Survey: FFELP and DL Trends
Methodology
Emailed flash survey on March 10, 2010 with due date of March 12,
2010.
In addition to demographic questions, the survey had the following
questions:
– Please select the choice which best describes your institution's current
plans for the 2010-2011 academic year?
– [For those transitioning to Direct Lending] Describe your overall level of
satisfaction with the implementation process to date.
– [For those transitioning to Direct Lending] What single resource has been
most helpful to you and your team?
– CHECK ALL THAT APPLY. My institution (either myself or other staff
members) has taken the following steps to prepare for Direct Lending
should that become the platform for loan origination as well as servicing in
2010-11:
– COMMENT ON THIS STATEMENT. The administration at my institution is
interested in having a contingency plan prepared to implement Direct
Lending by the proposed July 1, 2010 start date.
© Student Lending Analytics, LLC
Slide 3
SLA Flash Survey: FFELP and DL Trends
Methodology (continued)
Responses were normalized for following reasons
– Email addresses that did not correspond with an educational institution were
excluded
– Several schools provided multiple responses; only one response was
analyzed
Overall, 365 responses from financial aid administrators were
included in the analysis
© Student Lending Analytics, LLC
Slide 4
SLA Flash Survey: FFELP and DL Trends
Insights
Seventy two percent (72%) of respondents to the survey are currently in
Direct Lending (24% of respondents) or have committed to move to DL for
the 2010-11 school year (48%).
– These figures are up from 47% from the November 2009 survey when 24% of
respondents were in Direct Lending and 23% had committed to move to DL for
2010-11 school year.
– 17% of respondents indicated that they were preparing for DL but had not fully
committed to implementing it.
– 2% indicated that they would “only begin preparations for a transition to Direct Lending
when required by legislation.”
Overall, 2% of survey respondents indicated that they had not completed
any of the listed activities (there were twelve in the survey) to prepare for a
possible transition to Direct Lending
The five most frequently cited activities that respondents are
undertaking/have undertaken to prepare to implement Direct Lending are:
–
–
–
–
–
Participating in Direct Lending webinars
Contacting the COD School Relations Center to request participation in DL program
Reviewing materials on the Direct Lending website
Updating the PPA
Attended the FSA Conference
© Student Lending Analytics, LLC
Slide 5
SLA Flash Survey: FFELP and DL Trends
Insights (Continued)
97% of schools found the direct lending implementation process to be
acceptable or better
– 16% of respondents indicated that they were “very satisfied”, 52% “satisfied” and 29%
found the implementation process to be “acceptable”
Over 2/3 of respondents “agree” or “strongly agree” that their school
administration is interested in having a contingency plan in place to
implement DL by the July 1, 2010 deadline.
© Student Lending Analytics, LLC
Slide 6
SLA Flash Survey: FFELP and DL Trends
Profile of Survey Participants
School Type
School Ownership
50%
40%
30%
20%
10%
0%
50%
40%
30%
20%
10%
0%
4-year private
4-year public
2-year public
Other
Private
Public
Other
School Size
50.0%
40.0%
30.0%
20.0%
10.0%
0.0%
0 - 2,500
© Student Lending Analytics, LLC
2,501-7,500
7,501-15,000
More than
15K
Slide 7
SLA Flash Survey: FFELP and DL Trends
Current Plans For 2010-11 (Overall)
We are and will remain a Direct Lending
school
24%
24%
Currently FFELP; Committed To DL for
2010-11
18%
Currently FFELP; Committed Mid-year To
DL
48%
5%
Currently FFELP; Preparing for DL;
Undecided
5%
Currently FFELP; Preparing for DL;
Would Remain FFEL if Possible
17%
Currently FFELP; Will Prepare For When
Required By Legislation
2%
Nov 09
Mar 10
13%
26%
8%
5%
5%
Other
0%
10%
20%
30%
40%
50%
Percentage of Total Respondents
Survey question #1: Please select the choice which best describes your institution's current plans for the 2010-2011 academic year?
© Student Lending Analytics, LLC
Slide 8
SLA Flash Survey: FFELP and DL Trends
Current Plans For 2010-11 (4-Year Private)
We are and will remain a Direct Lending
school
18%
20%
Currently FFELP; Committed To DL for
2010-11
20%
Currently FFELP; Committed Mid-year To
DL
52%
5%
Currently FFELP; Preparing for DL;
Undecided
5%
Currently FFELP; Preparing for DL;
Would Remain FFEL if Possible
15%
17%
Currently FFELP; Will Prepare For When
Required By Legislation
2%
Nov 09
Mar 10
29%
8%
4%
5%
Other
0%
10%
20%
30%
40%
50%
60%
Percentage of Total Respondents
Survey question #1: Please select the choice which best describes your institution's current plans for the 2010-2011 academic year?
© Student Lending Analytics, LLC
Slide 9
SLA Flash Survey: FFELP and DL Trends
Current Plans For 2010-11 (4-Year Public)
We are and will remain a Direct Lending
school
45%
39%
Currently FFELP; Committed To DL for
2010-11
13%
Currently FFELP; Committed Mid-year To
DL
2%
Currently FFELP; Preparing for DL;
Undecided
2%
Currently FFELP; Preparing for DL;
Would Remain FFEL if Possible
Currently FFELP; Will Prepare For When
Required By Legislation
43%
Nov 09
Mar 10
11%
17%
11%
5%
1%
6%
4%
Other
0%
10%
20%
30%
40%
50%
Percentage of Total Respondents
Survey question #1: Please select the choice which best describes your institution's current plans for the 2010-2011 academic year?
© Student Lending Analytics, LLC
Slide 10
SLA Flash Survey: FFELP and DL Trends
Current Plans For 2010-11 (2-Year Public)
We are and will remain a Direct Lending
school
16%
17%
Currently FFELP; Committed To DL for
2010-11
25%
Currently FFELP; Committed Mid-year To
DL
46%
5%
Currently FFELP; Preparing for DL;
Undecided
Nov 09
Mar 10
11%
7%
Currently FFELP; Preparing for DL;
Would Remain FFEL if Possible
24%
22%
Currently FFELP; Will Prepare For When
Required By Legislation
5%
12%
8%
3%
Other
0%
10%
20%
30%
40%
50%
Percentage of Total Respondents
Survey question #1: Please select the choice which best describes your institution's current plans for the 2010-2011 academic year?
© Student Lending Analytics, LLC
Slide 11
SLA Flash Survey: FFELP and DL Trends
Activities To Prepare for DL – Overall
75%
82%
DL Webinars
59%
DL Website
58%
61%
56%
FSA Conference
Update PPA
76%
70%
53%
COD School Relations Center
DL Reg. Mtgs.
78%
51%
Software Vendor
29%
Team
29%
Electronic Account
28%
25%
Mentor Relationship
49%
57%
38%
18%
Comm. Strategy
Nov 09
Mar 10
43%
52%
3%
8%
5%
2%
Consultants
None
0%
10%
20%
30%
40%
50%
60%
70%
80%
90% 100%
Percentage of Total Respondents
Survey question #2: CHECK ALL THAT APPLY. My institution (either myself or other staff members) has taken the following steps to
prepare for Direct Lending should that become the platform for loan origination as well as servicing in 2010-11:
© Student Lending Analytics, LLC
Slide 12
SLA Flash Survey: FFELP and DL Trends
Most Important Resource For Implementing DL
Listservs
– “Emails from listservs that I belong to…”
– “Other schools on our enterprise software user listserv.”
Department of Education/COD
– “The Department direct lending transition process and newsletters as well
as being assigned a DOE rep to help with the transition.”
– WE have had several conference calls with the DL staff at the department.
THey have been extremely helpful.
– “Barbara Davis with Dept of Education has been absolutely wonderful!!
– “Catherine Lee, our USDE Direct Lending contact person”
– “Christopher Smith, the client rep from USDE helped us with setup.”
– “Federal Student Aid and NASFAA training.”
– “The DL "onboarding team" has been a great help. We have had a contact
person who is extremely knowledgeable about all aspects of DL.”
– “COD staff assigned to assist with school implementation.”
– “COD testing liason”
© Student Lending Analytics, LLC
Slide 13
SLA Flash Survey: FFELP and DL Trends
Most Important Resource
Peers
–
–
–
–
–
“Site visit to another institution already processing DL.”
“Training with another DL school on the same FA system.”
“Professional Colleagues”
“Discussions with other schools”
“Copying what schools have done before us.”
Software guides/consultants
– Software vendor consultant is helping is with the process.
– “Lists from our FAMS on what steps should be taken for transition.”
– We also spent the money to have a Datatel consultant come in for 2 days to
help us move things along.”
– “Banner consultant”
– “Powerfaids manual”
© Student Lending Analytics, LLC
Slide 14
SLA Flash Survey: FFELP and DL Trends
Satisfaction With Implementation Process
Percentage of Total Respondents with Literacy Program
60.0%
52%
50.0%
40.0%
29%
30.0%
20.0%
16%
10.0%
3%
1%
0.0%
Very Satisfied
Satisfied
Acceptable
Unsatisfied
Very Unsatisfied
Survey question: Describe your overall level of satisfaction with the implementation process to date.
© Student Lending Analytics, LLC
Slide 15
SLA Flash Survey: FFELP and DL Trends
Ideas To Improve DL Implementation Process
Difficulty of getting other departments on board
– “Our Business Office staff seems resistant to the fact that they are a vital
part of making our switch to Direct Lending a successful one.”
– “Our business office folks have not plugged in as much to the G5 process
as we think they ought to. They will be surprised!”
Support from COD
– “COD support is flagging. Difficult to access and numerous wrong answers.
COD needs improvement.”
One-to-one resources
– “Webinars and workshops have been a good tool, but I wish I were
assigned someone specific from the Dept of Ed to help me with the
transition.”
– “Need money for consultant to help with the conversion and training.”
– “The dept should have personnel available to visit schools to help with
implementation.”
© Student Lending Analytics, LLC
Slide 16
SLA Flash Survey: FFELP and DL Trends
Ideas To Improve DL Implementation Process
Website updates
– “Quicker updates from the Department of Education. Have a website
starting March 26th, but it feels like the deconstruction of the FFEL program
began in November of last year. If the Feds were going to push this without
the July 1st decision, then they themselves should have been more
prepared.”
– “Bring up the new website for PLUS loans asap!”
Testing
– “Being able to test files sooner. I am told by the person who handles this
that the Dept. has specific guidelines on when to start testing, and the
amount of records that can be tested.”
– “Provide more opportunities for testing the COD data flow in our system.”
– “DL was quite inflexible with testing.”
© Student Lending Analytics, LLC
Slide 17
SLA Flash Survey: FFELP and DL Trends
Ideas To Improve DL Implementation Process
Software vendor issues
– “Provide software-specific (i.e., Banner, Datatel, PeopleSoft, etc)
opportunities to learn about appropriate process flows.”
– “PowerFAIDS is late in with acceptable modules.”
– “Powerfaids software support”
ONE implementation guide
– “Found multiple descriptions of steps for implementation (from DL coalition,
from DL servicing, from NASFAA) and they did not all match. Would be nice
if there was one absolute step-by-step that all agencies and organizations
would point schools to.”
Dissatisfaction with Congress
– “Congress needs top act sooner so that schools can make a decision. By
not doing so, yet indicating that "if it passes it will be in effect for 7/1/2010",
they have given schools no other choice but to prepare their processes as if
Direct Lending for all is definitely going to happen, whether it passes or not.
We are being blackmailed into going Direct whether we want to or not, even
if the bill doesn't pass or if the legislation delays implementation for another
year.”
© Student Lending Analytics, LLC
Slide 18
SLA Flash Survey: FFELP and DL Trends
School Administration’s Interest In Direct Lending
Percentage of Total Respondents with Literacy Program
50.0%
44%
40.0%
37%
31%
30.0%
Nov 09
Dec 10
24%
20.0%
15%15%
12%
11%
10.0%
4%
6%
0.0%
Strongly agree
Agree
Moderately
disagree
Strongly
disagree
Not sure
Survey question: COMMENT ON THIS STATEMENT. The administration at my institution is interested in
having a contingency plan prepared to implement Direct Lending by the proposed July 1, 2010 start date.
© Student Lending Analytics, LLC
Slide 19
Thank You
Thank you again for your participation!
Please contact Tim Ranzetta if you have any additional comments
or questions regarding this survey
– Email: [email protected]
– Phone: 650-218-8408
For more information on Student Lending Analytics, proceed to the
final two slides
© Student Lending Analytics, LLC
Slide 20
Student Lending Analytics
Background
Founded in 2007
Independent Research and Advisory Service with NO lender affiliations
Mission: Find best lenders for students through an analytically rigorous and
comprehensive process
Services
– RFI Management of FFEL and Private Loans
– Research
Successes to Date
– Managed RFI process at institutions with over $600 million in loan volume
– Inside Student Lending, our monthly newsletter, reaches over 5,000 financial aid
administrators
– Student Lending Analytics Blog has become the go-to source for breaking
developments and analysis on the student lending industry
– SLA Flash Surveys have included the insights from over 1,500 financial aid
professionals on a variety of timely topics
– Private Loan Options and the SLA’s 2008 Alternative Loan Guide provides
students and financial aid offices with an objective and focused list of private lenders
© Student Lending Analytics, LLC
Slide 21
Student Lending Analytics
Resources Available
SLA Private Student Loan Ratings
2009 SLA Private Loan Series
– Ten part series on topics ranging from finding a cosigner to reading the
promissory note
Student Lending Analytics Blog
– Timely, insightful information about the student loan market
Private Loan Insight Survey
Student Satisfaction Surveys
© Student Lending Analytics, LLC
Slide 22