Student Loan Exit Counseling – Perkins and Institutional Loans

So my name is Sam Crow-Lucal. I work in
Student Financial Services and I’m going to talk about the Perkins loan and
institutional loans. The reason that it’s a different presentation is because
although the Perkins loan is a federal loan program it has different rules from
the direct subsidized, unsubsidized, and PLUS loans. So. And we’ve modeled our
institutional loans to follow the Perkins loan rules. So I’ll talk about
those and and give you information about the servicer who is UAS, so University
Accounting Services. So if you have a Perkins loan or an institutional loan you will
be getting contacted by UAS saying, “Hey, you’ve graduated and you have this loan.”
Now they shouldn’t be strangers. You should have when you first took out your
loan gone and filled out your master promissory note on their website so there
is a connection. You did have to enter in information about yourself to log in the
first time and if you’ve logged in multiple times then you’ve obviously had
to update information. So University Accounting Services. What happens is we,
or in this case the Registrar’s Office, sends the information to the National
Student Clearinghouse. This is where all the servicers, not just UAS, but also
the federal servicers get their information about whether you’re in
school or not, okay. So we report the the your enrollment information, in this case.
You’ve graduated. We’ll report that to the National Clearinghouse. Your servicers
will look at that and say, “Oh this student graduated.” So that’s what kicks
off the process of contacting you, letting you know about your grace period,
when you’re going to start payments, all that information. Okay.
Now this this session is good for the for the federal loan exit counseling but
for UAS, for the Perkins loan, and for any institutional loans you might have taken
out, you do need to do an online exit counseling. That’s on their website.
If you don’t do it online they send you a packet, a paper packet to the mailing
address they have on file, okay. But that will have specific information
to your situation, your perkins loan or institutional loan, it will have that
specific information. And you’ll be able to set up payments during that exit
interview. Once you complete it it will take you
and you can set up, you know, your automatic payments monthly from your
bank account. And then if you have any questions talk to you UAS, okay. We work
very closely with them so if you have a question after you’ve graduated and you
say, “Hey, you know, this is my situation,” if they can’t answer it or they they don’t-
aren’t sure exactly what we want them to do they’ll actually contact us. So
they’ll contact myself or another person in our office and say, “Hey, this is the
student’s situation. What would you like us to do?” Because there’s more leeway,
especially with our institutional loans, to be able to help you out. So we work
very closely with them so if you do have questions about a Perkins or
institutional loan contact them as soon as possible so we can help you out. Okay.
So again the exit interview is going to be the same as if you were to do one for
the federal loans. It’s going to have your rights and responsibilities as a
borrower because you do have rights and you have responsibilities, both of those.
So it’s not just “you have to pay the loan” and that’s all that you have to do.
There are other things you do have to do. There are things that you need to expect
others to do, whether it’s your servicer or the Department of Ed. So the exit
interview will outline those items. It’ll give you the repayment information. It
will give you your options for the different repayments. The Perkins loan
will have the same repayment options that the other federal loans do, okay. And
institutional loans are a little more forgiving. They’ll be able
to work with you to figure out repayment plans. Okay. Leave of absence. This, if
you’re graduating, this doesn’t quite apply to you. If you’re leaving the
school and coming back then it kind of does. So, leave of absence- when you leave
school and then come back at a later date to complete your program- what
happens is that your grace period begins immediately because you have left school.
You’re no longer enrolled full-time or in this case more than half-time is the
the language that it actually says. So in that case you’re not considered enrolled
and your grace period starts immediately. Now if you come back within the grace-
the grace period time frame, which for Perkins loan is nine months, then your
grace period gets restored. So we say, “okay, you took a break but you came back
you know six months later. When you graduate, when you actually leave school,
you still get the full grace period.” Okay. if you come back after that grace period,
let’s say you have an issue and you’re you’re out of school for a year, okay.
Then when you come back you don’t get the full nine month grace period, you get
a six-month grace period. It’s just a little quirk. But you still do get a
grace period. It’s not that you’ve used it up and you no longer have it for
Perkins, okay. Now if you plan to go to a different school after you leave
Stanford, whether that’s a graduate program or some other program at a
different school or at Stanford you can submit an in-school deferment form. Now
this is not automatic, okay. Even though the school, wherever you go, may report
that you’re enrolled, it won’t automatically defer your loans. So if you
if you’re going back to school make sure you fill out the the form and submit it
to UAS. If you have other loans, your Direct Loans, make sure you also submit
the form if it’s necessary to those servicers so that you can get an
in-school deferment for that. Because it’s not always automatic. Sometimes it
is, sometimes it isn’t it. Depends on the servicer, it depends on the school. And so
you don’t want to be in a situation where you’re back in school, you think
your loans are deferred, and all of a sudden you get a bill saying, “Hey, you’re
a month overdue. Why haven’t you paid it?” So again make sure you’re on top of that
deferment form. If you need enrollment information you can look in Axess to
see what it what your enrollment was here and again the schools look at that
National Clearinghouse. I believe if you go to NSLDS, the National Student Loan
Data System, you can see your enrollment history as well. So I talked about
deferment. Again, it’s it’s one form per loan. So if you have a Perkins loan and
you have a an unsubsidized loan you need to do a form for each loan, okay. It’s not
one blanket form that covers everything, okay. And you have to do it annually. So
you can’t say, “Oh I’m back in school and I’m doing a two year program so defer my
loans for two years.” No, they always look at it on an annual basis. So each year
you need to say, “Oh, yes. I am still in school. I’m submitting the form.
I still qualify for this deferment.” Okay. So Perkins is one of those loans that
does have cancellation options. Instead of forgiveness with Perkins loan they
call it cancellation. So there is teaching. So there’s the the Teacher Loan
Cancellation for Perkins. Very similar to the Teacher Loan Forgiveness for the
Direct Loans. Now you can use time teaching to qualify for both programs. So
if you have a Direct loan and you have a Perkins loan and you start teaching, you
can count that those years of teaching for the teacher loan forgiveness and for
the teacher loan cancellation, okay. You just can’t use two different forgiveness
programs on the same loan. So you can’t use public service loan forgiveness and
teacher loan forgiveness to to qualify for-
to forgive with just one, say, direct loan. Okay, there are a couple public service
loan forgiveness for Perkins. They follow the same guidelines as the direct loan.
Again, if you’re going to do this you need to submit the forms because nobody
is going to know if you don’t tell them. So submit the forms to UAS. Call them, say,
“Hey, you know, I’m working as a teacher now, or I’m working, you know, at a
non-profit and I want to qualify for for Perkins loan cancellation. What do I have
to do?” Let’s say you submit this form, you have it signed by these people, and you
submit the supporting documentation. Okay. They’ll walk you through the
process. Does anybody have an Avery loan? Is anybody teaching? Okay we can skip
the Avery loan. That’s a special Graduate School of Education program. Now for the
teacher loan cancellation for Perkins they do it by percentage, okay. So if
you’re teaching each year you submit the form that says “I taught for this year,”
okay. You submit it and then they cancel a percentage of your loan. So in year one,
after you’ve finished your one teaching, they cancel 15%. After year two, another
15%, Years three and four, 20% and 20%. And then they cancel the final
30% after year five. Okay. So you can get deferments for if you’re teaching. For
your Perkins loan you can get a deferment so you don’t have to make
payments while you’re teaching and then have it cancelled at the end of that
year. So this is a cycle. So you submit an application for deferment, okay. You
submit it to UAS. They say, “Okay, your payments are deferred for twelve months.”
okay. Then you send at the end of the school year, you say, you send them the
form saying, “Hey, I completed my year of teaching,” okay. You’re going to have to
have your principal or vice-principal sign off on it and you send it to UAS.
When they get that form, okay, they cancel that portion of the loan.
If you don’t submit the deferment form you can still submit the cancellation
form at the end of the year. They’ll just have expected you to make payments
during that year, okay. So you can make payments during the year and then cancel
a percentage at the end of the year. That’s fine. Or you can defer during the
year and cancel at the end of the year. Okay so for Perkins, UAS- the forms are going to be there, okay.
They have a list of all the forms that that you may need so if there’s
something that, you know, I haven’t talked about or you don’t remember when you’re
on there they do have a list of forms and you can always call them or email
them and they’ll let you know what you need to do. Okay.
Default- it’s the same thing as the Direct Loans, what Brandon talked about,
okay. Default is not good. And, you know, there are all sorts of bad things that
happen- negative credit history, you know, you can get denied for a loan, higher
interest rate on a loan. So, what happens is this “accelerate the loan” means
basically that instead of saying, “Okay you can make payments,” when it gets
accelerated it says, “You owe the entire thing right now, so no more
monthly payments. You just have to pay the whole thing back right now.” Okay.
Stanford does refer these loans to a collection agency if you go into default.
So you don’t want to deal with the collection agency.
Everybody has horror stories. Everybody who’s dealt with them has horror stories
about it. We do keep them on a tight leash to make sure that they do treat
our students with respect. So we do listen to phone calls that they have
with with students when they’re trying to collect to make sure that they’re
still treating people with respect but what they are out there to do is collect
the money, okay. So don’t go into default. It’s as simple as that. That’s the
easiest way to avoid all these bad things.
Have communication with the servicer, with UAS, and if you have questions ask
somebody, whether it’s UAS, whether its Financial Aid Office, whether it’s
Student Financials, whether it’s filing a HelpSU ticket.
Whatever it is, if you have a question, the best thing to do is ask. Okay. If you
do get into default there there are ways to get out of it and to get it off your
credit report. One is rehabilitation, okay, which is set up through UAS
in this case. And you have to make nine months of on-time payments. If you make
nine months of on-time payments they say, “Okay, you’re rehabilitated, you know. Your
loan is back in good standing. We’ll take it off your credit report,” Okay. (Audience question) “So if pay it all off on time does it boost your credit score?” Yes, yes, yep. So that’s positive credit history so it’ll have a
time since when you took out the loan and it’ll have a history of on-time payments
and then “paid in full.” (Continued question) “So if you pay back early does that not boost your credit score as much as…” The difference is negligible unless you
pay it off all of once, you know, right at the beginning. The difference is just the
the history and how the history gets weighed. If this is your only credit on
your credit report then yeah it will have an outsized impact because there’s
nothing else on your credit history. But if you have other
things, if you have a credit card, if you have other loans, then the difference
between paying it off, say, two years in and paying it off, you know,
eight years in, or ten years, is not going to be as big. Yes. (Audience question) “So what happens, for example, if you go into unemployment deferment or you default and then you go to another country maybe because you were only here to, like, get your degree or you’re permanent resident but you want to go back to your country. What happens?” So in that case what happens is if it’s
with a collections company, with the collections agency,
they’ll keep trying to collect. The Perkins loan goes back to the Department
of Ed and they have a collection agency that they use. What typically happens is
that Stanford will put a hold on your account that says, “This student has an
outstanding debt” and it that will prevent you from getting transcripts or
replacement diplomas. And so what we usually see coming through our office is
students who need transcripts or are asking for a diploma who, oh, you know, who have defaulted. Then that’s when it’s, okay, we can get them back on a payment
plan. We can help them but that’s typically what will
happen for those students. And if they- if a student leaves the country we’re not,
obviously, going to try and follow them into a different country but the collections
agencies will still try and contact, will still try and collect. It just- it’s
really within the US. (Continued question) “Does it affect their credit score or their ability to get financial aid in other countries?” No. Well it affects their credit score so if something – it’ll be on the
credit report for seven years. If somebody is in another country and they
they want to use that credit report then it will show up. But it won’t prevent
financial aid or things or other aid in other countries. The default is sort
of limited to the US because those are the- that’s the country that uses
those rules. So if another country decides they want to abide by those
rules and say, “Okay, you know, a default means- default in the U.S. means this for
us,” then they can do that. But typically it’s not- a default here is not
applicable to a situation in another country. Okay. Mind Over Money. So Sanford has an in-house financial literacy program and it’s just
getting off the ground now. But Mind Over Money is the web tool.
That’s on- so if you go to we have a link to Mind Over Money. It has tools. It has information. There are events both on and off campus
for students, for alums. And it’s anything from, you know, how does credit work to, you
know, retirement accounts to taxes, what-have-you.
So if you have- so the the website is down here in the corner – mindovermoney. So if you do have questions about, you know, random kind of financial
things and you go, “I have no idea who to talk to about this,” check out Mind Over
Money. It is a tool and give us your feedback
because we are trying to to improve it. So we can use any feedback you want to
give. And then, a couple to-do’s, as if you
didn’t have enough already. Make sure your contact info is updated
both in Axess and in UAS and with your servicer for your direct loans because,
“Oh, I didn’t update my information and so I didn’t get the letters, emails, phone
calls” is not a legitimate excuse when it comes to why you haven’t paid. They kind
of laugh you out of the room so make sure your contact info is updated. Make
sure you do your online exit interview with UAS. Check the accuracy of your loan
records, okay. Just check, whether it’s on NSLDS or, check to make
sure, “Hey, this is what I thought I have. This is what I have.” Okay, so that those
two match up so that you’re not surprised or, you know, something that you
thought you got you didn’t get or something that you didn’t think you got
you got. So just make sure that that you know what it is that you have, okay.
Again, report future enrollment whether it’s at Stanford or elsewhere via form.
Don’t expect it to happen automatically. And then follow up until your loan is
paid in full, okay. There’s nothing like getting a paid-
in-full letter from a servicer saying, “Congratulations, your loan is paid in
full.” Okay. It’s nice plus you don’t have that
monthly expense anymore. So this is the contact information for UAS, okay. If you
have questions that UAS can’t answer or you don’t feel comfortable asking UAS
file a help ticket, Put in the Student Services
Center in there and it’ll get routed to us. So if you do have questions, whether
it’s, you know, later today, tomorrow, two years from now, go ahead and and ask. Yes. (Audience question) “So does everybody have to complete the exit survey through UAS or just only some people?” Only if you have a Perkins or
institutional loan. So you’ll get a notification that you need to complete
it online from UAS. But if you want to do it now you can but you will be getting
an email if you have a Perkins or an institutional loan. Anything else? Okay. “Thanks again everyone for coming. Sam and Brandon are here to answer
questions individually. Also Darren Knipfer from Student Financial Services
is back there as well. Thank you everybody for coming and
congratulations on graduating!”

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