With tuition costs rising in recent years, many students are turning to loans to pay for college leaving many in debt. Student loan debt surpassed credit card debt in 2010. More and more students graduate with student loans.
An article published in the New York Times
entitled "A generation hobbled by the soaring cost of college" states
that about two-thirds of bachelor's degree recipients borrow money to
attend college, either from the government or private lenders. That
number does not include money borrowed from family members.
the national student loan default rate for students not repaying their
loans is over 13 percent, not all borrowing is bad according to Dan
Tramuta, associate vice president for student enrollment for SUNY
Fredonia and former president of the New York State Financial Aid
"It is important that people
understand that borrowing isn't the devil. The student loan program is a
terrific loan program. It's been a vehicle for many students and
families to be able to access higher education and not only gain an
undergraduate degree but a post-undergraduate degree," he said.
"Borrowing irresponsibly is the devil."
To encourage responsible borrowing, SUNY Fredonia provides a financial literacy guide to students.Bringing rfidtag
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Educational Services Corporation as being the best in the state about
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is something the college sends to every accepted freshman and transfer
Students also participate in fireside chats on campus
as well as access to a loan servicing center for help with questions.
The campus also has entrance and exit counseling for all students who
take out loans. The school has been chosen for a new SUNY initiative to
help students not go into default on their loans. The SUNY Smart Track
Initiative is a program that Fredonia has been chosen as one of six
pilot schools to participate in.
"I'm really excited about this
track initiative. It's about smart borrowing and about awareness early
on the moment students walk on our campus. It involves not just the
financial aid office but many other student offices on campus which is
really critical. It's not just one area, it takes a whole campus to
address this issue," Tramuta said.
The program will engage
students from before they enter onto campus as well as follow them
throughout their college career. As incoming freshmen, students and
families will be given information on how to piece together working
summer jobs, scholarships and loans to help pay for college. This
campuswide effort will track students through undergraduate and past
graduation. Tramuta says the campus looks for indicators that students
may default on loans.
"We know the pivot points and the factors
that would indicate borrowers who might have a high risk for going into
default. That could be low income borrowers, borrowers that drop
classes. What the engagement piece will do we will begin immediately
engaging our freshman borrowers,Please click the images below to view
more pictures of lasercutter tiles! our returning undergraduates and separated borrowers," he said.
will know how to borrow responsibly and to not over borrow. Tramuta
said sometimes students will borrow more than they need to cover tuition
giving the student a bigger refund back in the spring. Tramuta said if
students need extra money during the semester, a campus job is an
alternative to borrowing more than is necessary. Through the new
initiative, students will also take online quizzes while learning about
financial literacy, the importance of budgeting and how to be
responsible with credit cards. He wants students to understand borrowing
and what smart borrowing is.
The loan service center on campus
will use email, snail mail, phone calls and is looking into a smart
phone app to keep students informed about their loans as they go through
college. Upon graduation the college will also be able to track
students with their repayment as well as educating them on repayment
options through the smart track initiative.Find the best selection of
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times students don't know what their options are once they leave us.
They don't know there are options that can keep them out of a delinquent
default status," Tramuta said. "The student is not going into default
intentionally. They may be underemployed or unemployed. Helping students
understand their repayment options can make a huge dent in an
institutional default rate.
"Our president, President (Virginia) Horvath,Weymouth is collecting gently used, dry cleaned cableties
at their Weymouth store. has been talking to me about financial
literacy the moment she walked on campus in the role of vice president.
She's very committed and I think with the smart track initiative we're
going to engage borrowers more so than we done in the past," Tramuta
The student loan service center will contact graduating
seniors and talk to them about knowing their rights and responsibilities
as a loan borrower as well as knowing when repayment starts. Typically,
loans start repayment six months from graduation unless the student is
attending graduate school. Tramuta said students can avoid default
status by making the minimum payment. There are other repayment options
including income-based, income-contingent and extended repayment.
Students can make payments based on what they currently are making or
extend the terms of repayment past the typical 10 years.
student might have $25,000 in debt which would be $250 a month for 10
years. They may right now be underemployed so maybe all they can afford
right now is $40 a month. There's ways to do that until that student
gets over that underemployment status and gets more money," he said.
may also be forgiven if a student enters into a teaching position in a
low-income school or other service related fields. If a student cannot
find a job following graduation, Tramuta said the college will work with
the student to offer additional resources to help out students.