Consolidating Into Wellness

Consolidation is here to stay. The next few years will see the market for consolidation loans growing; and even when students begin to graduate with multiple loans at the same fixed interest rate, the lure of lowering monthly payments with longer repayment terms will keep the consolidation ball rolling. That's my prediction.

So consolidation is a fact of life that we need to deal with and continue to expect in the near and far future. On March 20th I wrote about students consolidating "out" of Wellness. I noted that the strength of ASA's Wellness campaigns lies predominantly in our repayment programs including our "Journeys," "Transitions," "Pathways" and "Bright Beginnings" programs. Although all students who enter into repayment with an ASA guarantee receive the benefits of these programs, we now have 19 colleges and schools who directly participate by branding these materials with their school's logo. And yet, it is possible that when the student chooses to consolidate, that without much knowledge by the school, the consolidation guarantee can go to another agency and the student will not receive the benefit of these programs. They consolidate "out" of Wellness. The school also loses out by failing to have ASA work to keep their Cohort Default Rate low. So schools need to keep an eye on their students' consolidation process and be sure they continue to receive the benefits of ASA's Wellness programs.

Some schools choose, quite appropriately, not to process their student loans with ASA. For whatever reason, they have found another agency or process that works better for their institution. I worked in the financial aid office for 22 years, and I always chose the process that worked best for my students and institution. Some schools have Financial Aid Management systems that work better with different agencies and Direct Lending schools appear to love that process.

But these schools' students can also benefit from our Wellness repayment services by consolidating "into" Wellness. By establishing a process that assists students in consolidating their loans with a lender who uses the ASA guarantee, these students will receive the benefits of all our repayment services. It's a Win/Win situation for both the student and the school: the school gets to process loans in the way that best suits the school and ASA gets to continue to prove the effectiveness of our Wellness services to students in lowering delinquency and default.

By the way, I have to acknowledge Sean Porter from MEFA who opened my eyes to this consolidating "into" Wellness. Thanks, Sean.

Best,
Duane

Posted by Duane Quinn on April 10, 2006 at 02:14 PM EST

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