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Entrance counseling sessions are required prior to each student receiving his/her first loan (not the first loan at your institution) either in person (individually or in a group), by audiovisual 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. Schools that participate in the Federal Direct Loan program may distribute entrance counseling materials in written format. The school must maintain documentation of compliance with entrance counseling for each borrower.
There is a prescribed list of items that must be covered in the entrance counseling session. This checklist will help ensure that the requirements for entrance loan counseling are being met. You should:
- provide students with an overview of all sources of financial aid available, reminding them that financial aid funds are limited;
- review the terms and conditions of Federal Stafford Loans (subsidized and unsubsidized);
- explain the use of the MPN;
- emphasize the seriousness and importance of the repayment obligation;
- remind students to read ALL loan documents and correspondence and to keep copies of each item, preferably in a central location;
- emphasize the importance of budgeting and personal financial planning;
- review the Borrower’s Rights and Responsibilities statement and the consequences of multiple borrowing;
- explain your school's refund policy;
- discuss annual loan frequency and your school's policy on this and how it works;
- explain your school's satisfactory academic progress policy;
- remind students of the obligation to repay the student loans, even if he/she does not complete school, cannot find a job, or is dissatisfied with the education received;
- review available repayment options;
- outline the situations in which a loan can be cancelled;
- review deferment, forbearance, and cancellation options of repayment;
- remind students to stay in contact with their FFELP lender/servicer or Federal Direct Loan servicer;
- explain the sale and servicing of loans; and
- remind students of the need to complete exit counseling.
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