Exit counseling sessions are required for each borrower shortly before the borrower ceases at least half-time study at your institution or within 30 days after learning that the student has ceased enrollment or failed to attend an exit counseling session. Counseling may be conducted either in person (individually or in groups), by audio-visual presentation or by interactive electronic means. Schools must also have an individual with expertise in the Title IV aid programs available after the counseling to answer the borrower’s questions regarding those programs. The school must maintain documentation of compliance with exit counseling requirements for each student borrower.
If a student borrower drops out without notifying the school, the school must confirm that the student has completed exit counseling, or mail exit counseling material to the borrower at his or her last known address. The material must be mailed within 30 days after your school learns that the borrower has withdrawn or failed to participate in an exit counseling session. The school is NOT required to use certified mail with a return receipt requested, but they must document in the student’s file that the materials were sent. If the student fails to provide any information, the school is not required to take any further action.
Some of the material presented at the entrance counseling session will again be presented during exit counseling. The emphasis for exit counseling shifts; however, to more specific information about loan repayment and debt-management strategies. This checklist will help ensure that the requirements for exit loan counseling are being met. The following information must be provided:
- Reinforce importance of repayment;
- Describe consequence of default;
- Explain use of the Master Promissory Note (MPN);
- Stress that repayment is required regardless of educational outcome and subsequent employability;
- Provide an average anticipated monthly repayment amount, based on borrower’s indebtedness or for average debt of Federal Stafford borrowers at school or in same program;
- Review repayment options (standard, extended, graduated, income-sensitive/contingent) and consolidation;
- Discuss debt management strategies that would facilitate repayment;
- Review forbearance, deferment, and cancellation options and procedures;
- Tell the student about the availability of loan information through the NSLDS Web Site, and the availability of the FSA Student Loan Ombudsman’s Office or 877-557-2575; and
- Collect driver’s license number and state of issuance, expected permanent address, address of next of kin, and name and address of employer (if known), and update any changes to student’s personal information (name, social security number, etc.).
Other suggestions for exit counseling include:
Provide student with contact information for lender(s) and reinforce importance of communicating change of status, etc., with the lender (or holder of the loan).