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HSf! effort tn rpHur 'w w ?i ?w WM Wf w By Laura Dannhardt Although 10,476 student loans totalling about $1.2 million are past due, the amount of defaulted loans at USC campuses has declined by almost half, said Robert Perrin of accounting services. The percent of defaulted National Direct Student Loans at USC has decreased from IS 7 percent in June 1981 to 7.68 percent in June 1984. "We've made a great effort in trying to educate students of their responsibilities before they ever leave the schools," he said, adding that students are informed of their rights and responsibilities as loan recipients at mandatory conferences held annually and then again upon graduation or withdrawal from the university when the student signs his repayment schedule, ne said. THE UNIVERSITY has also taken other steps to discourage defaults, which include holding transcripts, denying readmission to USC, submitting the defaulter's name to the state to defer the student's tax returns to the university, submitting the defaulter's name to credit bureaus and if necessary, approving legal action. The steps to decrease the default rate were made not only to ensure the university receives loan repayments, but to comply with federal law, Perrin said, noting that the government requires all universities to stay below a 10 percent default or "otherwise we risk losing our programs." The government provides the university funds for NDSLs, and the state of South Carolina must match the funds by 10 percent. The university disperses the loan money to the students, and the money collected from repayment then is circulated back into the loan fund, he said. "The trend of the future is the federal govern ment will begin cutting back monies that they give to the institutions to lead out the students. So the bottom line is, it places more emphasis on collection of accounts. So if students that have borrowed money previously don't pay, it's eventually going to hurt us more and more each year," Perrin said. | "Need Extra Cash" | $14.00 On First Donat 1 Twice A Week Donatic $<tt <tt <tt <tt w w w w I COLUMBIA PLASMA CENT t:j 1916 Taylor Street ti Columbia, South Carolina 29201 | Phone 254-6683 I (5^^ "Bring this Coupon with you Mapaw I THIS WEEK'S SPECIALS Reg. Shrimp Dinnc Served with French Fries, Hush Puppie and Cole Slaw I Reg. $4.55 Special $3. Small Shrimp Dlnn< Served with French Fries, Hush Puppie and 5lau/ I Reg. $3.65 Special $3. B FREE Iced Tea with meal with USC II ||j| Phone ahead for quick carry out servic H 1725 Broad River Rd. Ph. 79l :.uj 1208 Knox Abbott Dr., Cayce Ph. 79< jjj 3200 Two Notch Rd. Ph. 78i e defaulted student li CURRENTLY USC-Columbia lends 13,787 loans totalling $17,886,475. Of those, 8,070 worth $9,503,968 are outstanding or in repay ment status, which means they are either defaulted, deferred or postponed. On USC regional campuses, 2,406 loans worth $1,747,516 are outstanding in repayment. The regional campuses have lended 8,070 total, worth $9,503,968. r l _ . ? ^ w nen a siuaent refuses to begin repayment after 180 days past due, the university turns the case over to a private collection agency, Perrin said. The agency pursues the student through every avenue possible. If a defaulter still refuses to begin repayment after six months, the private collection agency will seek legal action, he said. The university legal department has power to approve the litigations. If approved, the agency begins court procedure, Perrin said. IN MOST cases, the student repays the loan upon court notification, he said. If a case proceeds through the courts, however, the student usually ends up repaying the loan and 15 to 20 percent of the court expenses. "It's determined by the court what's the percentage . . .It depends which state you're going to sue in. I think the average state fee as far as South Carolina is concerned is 15 to 20 percent," he said, noting the remainder of the court expenses are "absorbed through the loan program." WHEN A private collection agency receives approval from the university to pursue litigation, the agency collects 40 percent of whatever is collected from the student, he said. "As far as normal collection, it ranges (percent paid to the collection agencies). The national average is 33.4 percent. . . Every $100 an agency collects costs us $33," Perrin said. When it becomes obvious to the university that the amount will not be collected because the debtor cannot liquify assets or because collection of the loan is more costly than the value of the loan, the university declares the account uncollectable and gives it to the government, Perrin said. J cpixixsxsnxiinnCTixixixE ___ ion 1 II T ! B: * spc EE I I * C | ]; University Be a jl ..,u ? zzfi registratio HI OCT. 3rd Ml * HH | * REG! | GAME] n fig * '11 * * Ta IB Rpir a: * Ve j .... j Made possible bv ETmrmrmTTTrrr^^ oan rate successful "IT'S ONLY after we've done everything. After we've sent it through two collection agencies and we've determined it's not worth it to go to court, that we submit it to assignment," he said. The money the government collects from the student then, is the property of the government,, and is lost from the university's loan fund, Perrin said. "I've had students declare bankruptcy hpfnrp th#?V pvpr pnfpr ronoiimnnl '? wV.w.w v..v; Vf VI Vinvi 1 vpw; II1V111 , 111 w llldl we'll file a claim with the courts," Perrin said, noting that although they cannot demand repayment during the bankruptcy proceedings, students are still responsible for the loan after court proceedings. Students declaring bankruptcy to avoid loan repayment are not discharged from their responsibility, he said. "UNDER THE federal law of bankruptcy, if a loan has nnt hppn in rpnavmpnt f>?r fi?/? ? wv.. mmm v|yM;iiivill I V/l 1 1 * V J VUI O and someone files bankruptcy in Chapter 7, he is not eligible for discharge. They still owe the debt. The only exception to that is the court will have to rule undue hardship, but that's a law that a lot of students are aware of that a NDSL program is not dischargeable under bankruptcy." The court may set up a wage-earner plan where an indebted student will pay a trustee so much each month and he divides it up until it's paid off. The percentage depends on what the court decides, he said. USC usually handles no more than 25 to 30 bankruptcy cases a year, Perrin said. "Probably the oldest loan we have right now that is past due and still on the books is mid 70s. A student can't run away from their repayment responsibility, Perrin said, noting some will ienore renavment until it'c in "thp hanHc r?f the private collection agency." "We're here to help the students. That's part of the problem. They can't ignore the debt. It doesn't help the problem, it worsens it," he said. 'OURN ANIENT I M. ~ )nsored by . E 5PU and * I )okstore-Gameroom IE ||M * ^ | N EXTENDED TO 1 [STER IN ^ * I DAAH PAD 0 iivviifi yi :oosball ^ * I Bowling | Chess I Bridge ? bletennis M ;kgammon 1 Billiards 3 H ' Student Activities Fees g UHW CHARITY FUND nerve iy i\i v jl_j IS UNDERWAY! '84 EVENTS: HAUNTED HOUSE CANNED GOODS DRIVE I I SERVICE PROJECTS CAROLINA | CARES DAY i J PHDTQTTwf AQ A u? 1 1C TREE LIGHTING MEETING ' 7: PM OCT. 2 Student Activities Center Russell House West Win& v omm \ i