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Ombudsmen Panel:. Student/Borrower Advocate – The Role of the Ombudsman. FSA Ombudsman FY2012 Update. 34,909 contacts received Increase over FY2011 Increase in Research cases Economic issues Loan transfers System conversions Collaboration with CFPB

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Ombudsmen panel

Ombudsmen Panel:

Student/Borrower Advocate – The Role of the Ombudsman


Fsa ombudsman fy2012 update

FSA Ombudsman FY2012 Update

Navigating the Sea of Change 2012 NCHER Knowledge Symposium

  • 34,909 contacts received

    • Increase over FY2011

  • Increase in Research cases

    • Economic issues

    • Loan transfers

    • System conversions

  • Collaboration with CFPB

    • Link from CFPB.gov to FSA Ombudsman site


Caucus background

Caucus Background

Navigating the Sea of Change 2012 NCHER Knowledge Symposium

Vision:

The vision of the Caucus of Student Loan Ombudsmen (the Caucus) is to: provide a resource for the creation and support of highly effective student aid problem resolution methodologies, techniques and processes that promote equitable services for all federal student aid participants.

Mission:

The mission of the Caucus is to: provide training and mentoring; identify and report on trends to support positive change through industry best practices and legislation; and serve as a voice of fair process throughout the student loan life cycle.


Trends committee

Trends Committee

Navigating the Sea of Change 2012 NCHER Knowledge Symposium

Analyzes Data from FSA Ombudsman’s Office(Inquiries/escalation from customers throughout the industry)

Adds in data from all participating Servicers and Guarantors for non FSA volume – full picture


What are our industry top 5 trends

What are our Industry Top 5 Trends?

Navigating the Sea of Change 2012 NCHER Knowledge Symposium

Account Balance

Loan Cancellation/Discharge

Repayment Plans/Amounts (excluding IBR)

Default (excluding rehabilitation issues)

Service Quality (excluding split-servicing)


Top issue account balance

Top Issue – Account Balance

Navigating the Sea of Change 2012 NCHER Knowledge Symposium

Averages 26-28.5% of overall volume over last 11 years;

Questions/issues differ from non-defaulted compared to defaulted borrowers;

Questions/issues cover a broad range of sub-topics

What types of questions/complaints does your organization receive regarding account balances on loan accounts?


The caucus hears

The Caucus Hears…

Navigating the Sea of Change 2012 NCHER Knowledge Symposium

  • From non-defaulted borrowers:

  • - Disbursement amounts

  • - Payment application

    • Pre-Payment

    • Interest capitalization (the effect of deferments and forbearances)

    • Subsidized vs Unsubsidized loans

    • Change in Payment Plan (example ICR to standard)

    • Simple daily interest accrual

    • Interest rate changes

    • Fees assessed


Case study 1 non defaulted customer

Case Study #1:Non-defaulted Customer

Navigating the Sea of Change 2012 NCHER Knowledge Symposium


The caucus hears1

The Caucus Hears…

Navigating the Sea of Change 2012 NCHER Knowledge Symposium

  • From defaulted borrowers:

    • Payment application – collection costs

    • Interest capitalization before default and after rehabilitation;

    • Subsidized vs. Unsubsidized loans

    • Simple Daily interest accrual

    • Interest Rate changes

    • Collection Costs – how much is charged

      • Effect on rehabilitation and consolidation

    • Offset payment application


Case study 2 defaulted customer

Case Study #2:Defaulted Customer

Navigating the Sea of Change 2012 NCHER Knowledge Symposium


Framing recommendations

Framing Recommendations

Navigating the Sea of Change 2012 NCHER Knowledge Symposium

List is long; must be prioritized

No single problem or solution

Use data to prioritize and provide a place to start

Review contacts received about Account Balance from 28 Caucus members during FY2012


What the data reveals

What the Data Reveals

Navigating the Sea of Change 2012 NCHER Knowledge Symposium

  • Account Balance represents nearly 67% of all contacts received by Caucus members, including FSA, from non-defaulted borrowers through 3rd quarter of FY2012

  • FSA identifies more specific issues from non-defaulted borrowers:

    • loan disbursement timing and accuracy;

    • Interest accrual

    • Payment posting


What the data reveals1

What the Data Reveals

Navigating the Sea of Change 2012 NCHER Knowledge Symposium

  • Account Balance represents roughly 33% of all contacts received by Caucus members, including FSA, from defaulted borrowers through 3rd quarter of FY2012

  • FSA identifies more specific issues from defaulted borrowers:

    • Challenges to the validity of debt

    • Late charge disputes (including collection costs)

    • General questions about balance calculation


Next steps

Next Steps:

Navigating the Sea of Change 2012 NCHER Knowledge Symposium

Work to create simple explanations for each steps

Create a consistent message for customers

Additional Communication Opportunities

Share trend data with the Caucus and participate

- Calls take place 3rd Tuesday of the month at 3pm eastern

- Contact Vicki Shipley at [email protected] to be added to the List Serv


Contact information

Contact Information

Navigating the Sea of Change 2012 NCHER Knowledge Symposium

Joyce DeMoss [email protected]

April Petroski [email protected]

Tracy Stine [email protected]

Diane [email protected]


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