2008 CASFAA EXECUTIVE COUNCIL
[pic]2008 CASFAA EXECUTIVE COUNCIL
President
Louise Jones
UC Riverside
1156 Hinderaker Hall
Riverside, CA 92521
President-Elect
Barbara Bickett
Western Career College
27401 Los Altos #400
Mission Viejo, CA 92677
Past-President
Mindy Bergeron
John F. Kennedy University
100 Ellinwood Way
Pleasant Hill, CA 94523
Vice-President-Federal Issues
Dr. Patricia Hurley
Glendale Community College
1500 N. Verdugo Road
Glendale, CA 91208
Vice-President-State Issues
Noelia Gonzalez
CSU, Northridge
18111 Nordhoff Street
Northridge, CA 91330
818.677.5999
Treasurer
Tom Ma
UC, Irvine
102 Aldrich Hall
Irvine, CA 92697
Treasurer-Elect
Nicholas Valdivia, UCLA
405 Hilgard Ave; Box 951435
Los Angeles, CA 90095
Secretary
Tanya M. Grigg
Samuel Merritt College
450 30th Street, Suite 2850
Oakland, CA 94609
Member-at-Large
Graduate and Professional
Charles Conn
UC Berkeley, Haas School of Business
420L Student Services Bldg.#1900
Berkeley, CA 94720-1900
Member-at-Large
Ethnic Diversity
Dewayne Barnes
Stanford Law School
559 Nathan Abbott Way
Stanford, CA 94305
CSU Representative
Michael Dear
Sacramento State University
6000 J Street
Sacramento, CA 95819
Community College Representative
JoAnn Bernard
Mira Costa College
1 Barnard Drive, FAO MS#3ª
Oceanside, CA 91711
Independent Representative
Yvonne Gutierrez-Sandoval
Pitzer College
1050 N. Mills Avenue
Claremont, CA 91711
Proprietary Representative
Valerie Edwards-Bendy
Heald College
1605 E. March Lane
Stockton, CA 95219
UC Representative
Heather Nardello
UC Merced
5200 N. Lake Road
Merced, CA 95343
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CALIFORNIA ASSOCIATION OF STUDENT FINANCIAL AID ADMINISTRATORS
May 15, 2008
The Honorable George Miller
United States House of Representatives
Washington, D.C. 20510
Dear Congressman Miller:
RE: Reinstatement of Lender and Guaranty Agency Ability to Provide In-Person Loan Counseling HEA Amendments – HR 4137: Part E, 155(b)(3)(B) (iv)
The California Association of Student Financial Aid Administrators, representing over 1600 financial aid administrators employed at over 600 institutions of higher education in the State of California, are writing to request clarification and strengthening of the lender in-person loan counseling provision in HR 4137.
This is among the many provisions currently being discussed by the Conference Committee and staff reviewing recently passed Amendments to the Higher Education Act. The current House HEA proposals exempt in-person counseling in the definition of banned gifts in the section referenced above but it is not clearly stated as an eligible activity in other parts of the bill. However, other language, such as, the ban on activities not provided by the Secretary under the Direct Loan program, are more strongly stated and could be interpreted as over-riding the gift exemption definition. We are concerned that legal interpretations could provide the basis for regulations that would continue to ban in-person counseling by lenders and guaranty agencies.
We request that the following language from 155(b)(3)(B)(iv) be also added to Sec. 157(c) Institutional Counseling and suggest the following:
(3) An institution may enlist the services of a lender or guaranty agency to assist in the delivery of required student loan entrance and exit counseling provided that (I) the institution’s staff are in control of the counseling (whether in person or via electronic means) and (II) such counseling does not promote the products or services of any lender.
We are requesting this additional language because students are best served when schools can take advantage of the expertise of lenders and guaranty agencies in providing information to borrowers. Increasing loan volumes, state demographic changes and the increasing complexity of the FFELP program require the efforts of both the institutions and the lenders and guaranty agencies in order to provide the best and most complete information possible to student borrowers.
According to the California Postsecondary Education Commission, California colleges and postsecondary institutions enroll approximately 2.4 million students, about twice as many as New York, the state with the next largest enrollment. Over the past 10 years, the number of loans guaranteed for students attending California post-secondary institutions has increased from about 300,000 to 1.2 million.
During that same period, the average student indebtedness for all California students increased from $11,000 to about $18,000. Loan counseling has become a much larger function for financial aid offices. Many colleges want to make sure that students understand their loan obligations and require students to complete a loan counseling session every year they borrow rather than just when they begin and end their program. This approach has worked very well with some populations. Although there are many web-based loan counseling products available, this method assumes a fairly motivated and sophisticated user and does not adequately serve student populations, such as, ESL students, many first generation students or students who just need to ask questions in order to understand the information. Several organizations (New England Resource Center for Higher Education, TERI, The Tomas Rivera Institute, TICAS) have conducted studies on the need for better delivery of financial aid information to low-income, first-generation students. In-person counseling is more effective for many students than on-line programs.
Given the increasing complexity of the student loan programs and the increasing loan levels, loan counseling is more important than ever. Lenders and guaranty agencies are best equipped to provide current and accurate information on loan provisions, projected interest rates, deferment and forgiveness provisions and borrower benefits. We strongly feel that in-person loan counseling by lenders and guaranty agencies is an essential benefit for students.
If there is concern over possible conflict of interest and inappropriate marketing, we suggest that guaranty agencies be allowed to do the entrance counseling and lenders be allowed to do exit counseling. Guaranty agencies do not originate loans, are not selected by a student and are equipped to talk about loans in a general way and how the borrower benefit may differ from lender to lender. By allowing lenders to do exit interviews, students are given an opportunity to talk directly to their own lender and get the best information about their responsibilities, projected interest rate and benefits. Since the student has already selected his or her lender at this point, marketing and conflict of interest concerns become moot.
Thank you for your consideration of our request on behalf of the students of California. Please contact us if you need additional information.
Sincerely,
Louise Jones
CASFAA President
Cc: Senator Diane Feinstein
Congressman George Miller
Congressman Buck McKeon
Congresswoman Lynn Woolsey
Congresswoman Linda Sanchez
Congresswoman Susan Davis
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