New strategies are helping NICC to reduce the number of student loan defaults

(Photo courtesy of NICC)

New strategies are helping NICC to reduce the number of students defaulting on their student loans.

The college's official 2012 three-year default rate is 18.3 percent.  293 students out of 1,601 borrowers defaulted.  That's a decrease of 4.6 percent from the 2011 default rate, which amounted to 322 students.

School officials learned that students who reached the level of 15 NICC credits were much more likely to complete their program of study, graduate, obtain strong employment and repay their debts.  As a result, NICC has full-time enrollment specialists who work with students who have become at-risk borrowers.

NICC also partnered with a consulting firm to intervene with students who are delinquent on loans before they default.  As of September of this year, 338 delinquent borrowers have had their accounts resolved, rather than falling into default.

A new required first-year college experience course for students also includes a student loan education component.

A statewide report covering all 15 of Iowa's community colleges concluded that several factors affected loan defaults: students who borrow the least are the most likely to default; many defaulters take no action on their debt, suggesting the complexity of the repayment system and a lack of information to help borrowers; a large number of borrowers – especially defaulters – are not progressing or completing a credential; and community colleges lack access to complete information and a user-friendly system to analyze loan data, making default management unnecessarily difficult.