Fading fast are the days of dating people you’ve met through friends or coworkers, using envelopes and stamps to pay bills – what a novel idea – and the quaint practice of conducting exit counseling within the confines of a financial aid office.
In today’s world, with technological discoveries and advances ’round every corner, these ancient and obsolete practices of daily life 10 years ago are quickly disappearing. They are being replaced by dating websites, the ubiquitous presence of online billing alternatives and, finally, Web services for college students, such as Mapping-Your-Future.org.
Over the years, graduation has become synonymous with exit counseling…or has it?
What is Student Loan Exit Counseling?
Under federal dictate, all accredited higher education institutions must provide exit counseling to every Stafford Loan borrower either in person, by audiovisual presentation, or by interactive electronic means. Schools are further required to deliver counseling to students prior to graduating, or once a student has dropped below at least half-time enrollment.
Exit counseling is a timely requirement, as student loan repayment begins six months after dropping below at least half-time enrollment or six months after the last attended class.
Counseling sessions vary from institution to institution, as individual schools require different information. However, all the counseling sessions possess some common threads.
For instance, the federal government insists that exit counselors inform you of the following information:
- Your average anticipated monthly loan repayment amount
- Your repayment options including student loan consolidation
- Conditions under which you may defer or forbear repayment or obtain a full or partial discharge of a loan
- Availability of the Student Loan Ombudsman’s office – the federal office designated to resolve disputes and other issues with federal student loans
- Availability of your loan information in the National Student Loan Data System (NSLDS)
This information is of supreme importance for any student possessing student loans, as he or she will soon be forced to financially mature, making the student wholly accountable for his or her outstanding student loan debt. Considering that, the average student loan debt possessed by a recent four-year college graduate is approximately $21,900, statements requiring a $210 minimum monthly payment can come as a startling shock for many.
Until this point in one’s collegiate career, student loans are commonly perceived as intangible transfers of money that subsequently get placed on the back burner until lending agencies hauntingly return to collect. In theory, exit counseling is designed to inform students of their financial obligations, repayment options and other services available to them in order to prevent potential confusion. Evident by the 1990 peak in student loan default rates, which reached 22.4%, it can be determined that, in the past, exit counseling had been poorly conducted.
A more interactive exit counseling session must be implemented, requiring that students do more than just stare blankly and nod excessively at the exit counselor, pretending to understand and signing on the dotted line, thereby certifying their pseudo comprehension.
Established in 1996, Mapping Your Future (MYF) is viable alternative to traditional exit counseling. MYF is a non-profit organization, wholly sponsored by all U.S. federal student loan guarantee agencies, that offers free, Web-based college, financial aid, career, and financial literacy information and services.
Why Complete Your Student Loan Exit Counseling Online?
"With online student counseling, students have the convenience of fulfilling their entrance and exit interview requirements anytime, anywhere," says Carianne Behr, MYF project/team coordinator. "They don’t have to schedule a meeting at their school or even go on campus."
MYF’s online student loan exit counseling may take up to 25 minutes to complete, but requires that student borrowers read through all mandatory information and then answer one or two questions correctly before proceeding to the next step. This provides verifiable interaction and comprehension – absent in exit counseling of yesteryear – thereby producing more educated and fully informed borrowers.
Upon concluding a student loan exit counseling session, the borrower is provided with a confirmation number that is electronically forwarded to the borrower’s school. The efficiency and ease of this process, however, are twofold.
Today, 2,175 schools participate in MYF’s free program. Since inception, MYF has issued nearly 4 million confirmations. In effect, MYF has not only saved the schools nearly $15 million by reducing staff time and operating expenses, but according to Behr, "…now school staff [members] are able to spend more time with students needing individualized assistance."
Casey N. Jennings is a communications specialist forAmerican Collegiate Financial Services(ACFS).