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GCCC Bucks National Trend By Lowering Student Loan Default Rate

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According to figures recently released by the U.S. Department of Education, the Garden City Community College Office of Financial Aid has successfully reduced the college’s three-year cohort default rate (CDR) by 2.7 percent. This is contrary to the national trend which shows an increase every year since 2007.

Cohort refers to the group of student borrowers who enter repayment agreements on certain federal student loans, specifically Federal Family Education Loans (FFEL) or William D. Ford Federal Direct Loans (DL), during a particular federal fiscal year (October 1 to September 30). An institution’s three-year cohort default rate is the percentage of borrowers in the cohort who default before the end of the second following fiscal year. The cohort year is the specific year for which the CDR is calculated.

Draft, or preliminary, CDRs are shared with individual schools each spring, usually in February or March, followed by a challenge period, where schools are able to submit corrections as needed. Official CDRs are made public no later than September 30th each year.

For the 2011 cohort year, the CDR calculated for GCCC fell to 7.9 percent, from the previous year’s 10.6 percent (also down from 12.3 percent in 2009).

“This validates and verifies the commitment that GCCC has to ensuring that federal dollars get maximum benefit,” said Dr. Herbert Swender, GCCC president. “Furthermore, it ensures that our future students are allowed access to these critical financial aid programs as well as eligibility to Pell Grants.”

Since 2009, the first year to publish official three-year CDRs, GCCC has reduced its default rate by a total of 4.4 percent, potentially saving the taxpayers’ money.

According to the Higher Education Opportunity Act (HEOA) of 2008, colleges with high cohort default rates can lose eligibility for federal student aid programs, specifically, FFELs, DLs and Pell Grants. Schools with an official CDR of 30 percent or more for three consecutive years risk detrimental program sanctions. This is one of the reasons why some community colleges have opted out of the student loan system. A community college that has a cohort default rate that is close to the threshold might choose to stop offering federal education loans in order to preserve its students’ eligibility for the Pell Grant.

Kathy Blau, director of financial aid at GCCC, is very passionate about her department’s role in each student’s success and the role federal student aid programs play in overall college completion rates. She is assisted by Melinda Harrington, assistant director of financial aid, and Jill Lucas, financial advisor.

“I have an amazing team of individuals who work tirelessly to assist and educate students through the process and ultimately retain the college’s ability to provide these essential programs and successfully graduate more students every year,” said Blau. “It is important to note that, according to our director of institutional research, Deanna Mann, over 90 percent of first-time, full-time, degree-seeking GCCC students rely on some form of financial aid to attend college.”

Additionally, Blau believes their success is attributed to a campus-wide effort to foster each individual student and help further their college goals.

“We work together with all departments in order to identify at-risk students, treat them with respect, and develop a plan to fulfill their obligations,” said Blau. “If students are happy with the end result of their college experience, they will be more likely to pay back their loans.”

According to Swender, Blau is just one example of the many committed and dedicated faculty, staff and student members that have elevated the college to be a premier community college in Kansas and the United States.

The financial aid office has implemented additional initiatives to promote borrower awareness and provide outreach, training and professional development programs and materials to students, parents, educators and the general public. Those programs include financial literacy presentations on credit, banking, money management, budgeting and student loan repayment requirements; Parent Night seminars conducted at various locations across the region and the annual College Goal Sunday event held at Garden City High School which educate parents and students with all aspects of financial aid; and the utilization of social media to network and follow the progress of students.