Student Loan Blog : Chicago Tribune

Kellogg Sends Acceptance Letters to 50 Rejected Applicants

Student Loan Girl — Mon, 22 Dec 2008 22:55:00 GMT

Described as a “technological glitch,” Northwestern University accidentally sent acceptance letters to 50 potential candidates for the school’s Kellogg School of Management, the Chicago Tribune reports (“Kellogg School of Management Accidentally Sends Acceptance Letters to 50 Rejected Applicants,” Dec. 18, 2008).

It truly was a computer error, said a Northwestern spokeswoman Megan Washburn, who stated that this was the first time the school’s automated mail-merge program had erroneously sent an e-mail acceptance letter.

“It has never happened before,” Washburn said. “Our systems have been in place for years. We have never experienced a problem.” She pointed out that the 50 candidates only represent about 1 percent of the 5,500 applicants who applied to the full-time business graduate program.

One student celebrated his acceptance to Kellogg at a dinner with his parents only to discover the next day that he had actually been rejected when he logged onto the school’s website.

“It was pretty embarrassing, to be honest,” said the Chicago resident who asked the Tribune not to identify him. “It’s like you won the lottery and had the rug pulled out from under you.”

Washburn said that the school had been contacting everyone who had received an acceptance letter in error to explain the computer glitch. The 50 individuals will be reimbursed their $235 application fee as a result of the mix up, she said.

“Certainly we’re very, very sorry,” Washburn said. “It’s an isolated incident and something we definitely have corrected and will work to ensure it never happens again.”

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Debt Collection Agency Adding Hundreds of Jobs

Student Loan Girl — Tue, 18 Nov 2008 17:21:00 GMT

Premiere Credit of North America, a debt collection agency based in Indianapolis, is a bit of an anomaly in today’s down economy — it is thriving at a time when many businesses are cutting back their workforces and many debt collection agencies are losing money to cash-strapped consumers who can’t pay up.

Premiere Credit, which specializes in collecting unpaid student loans and government debt, has been performing so well that it’s looking to add nearly 300 employees to its 250-person staff, reports Erika Smith of The Indianapolis Star (“Debt Collector Premiere Credit to Expand, Add 300 Jobs,” Nov. 13, 2008).

To accommodate its growing business, Premiere Credit is also preparing for a $4 million expansion of its headquarters and is planning to open a second operations center (“Indianapolis Debt Collection Firm to Expand,” Chicago Tribune, Nov. 12, 2008).

The company, which manages more than 700,000 accounts valued at more than $1 billion, is scheduled to receive about $2.5 million in performance-based tax credits from the state, as well as up to $200,000 in training grants.

Student Loans Make Up 40% of Company’s Debt-Collection Business

Premiere Credit CEO David Hoeft attributes the company’s growth to its four-year contract with the U.S. Department of Education, which currently accounts for 40 percent of its business. While the number of delinquent college loans isn’t growing — the student loan default rate has remained steady at 5 percent over the last few years — Premiere has snagged a greater proportion of collection work, Hoeft said, and, with the help of an expansion to its Education Department contract, Premiere’s student loan debt collection business is expected to grow even more.

Debt collectors have a much easier time collecting government-backed student loans than unsecured debts like credit cards, which are not tied to an asset. Federal student loans can forcibly be repaid in a number of different ways and debt collectors have more legal leeway to track down debtors.

“There’s no statute of limitations on collection efforts. [Federal student loans], more often than not, can’t be discharged in a bankruptcy,” Smith writes. “Collection agents can garnish wages, tax refunds and Social Security payments, and they can access a federal database of new hires that makes it easier to find employed people who can pay.”

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Graduate Students Scramble to Find Loans After College Cuts Ties With State Lender

Student Loan Girl — Mon, 07 Jul 2008 18:22:00 GMT

Graduate students at the University of Chicago will need to find new lenders this year after the school announced it will no longer do business with the Illinois Student Assistance Commission.

The university cut ties with the state student loan agency on Wednesday after learning the student loan agency would be unable to renew the school’s line of credit under the current economic conditions, according to the Chicago Tribune (“U. of C. Cuts Ties With State Lender Amid Market Flux,” July 2, 2008).

About 3,000 graduate students at the University of Chicago — about one third of the university’s graduate population — will now have to scramble to find new lenders offering federal and private student loans.

“The majority of our students will be able to get loans from other providers,” said Kimberly Goff-Crews, the school’s dean of students.

Those students who have a hard time getting college loans before the start of the 2008–09 academic year, can get a cash advance from the university to cover living expenses.

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Top-Rated Colleges Drop SAT Requirement for Admissions Applicants

Student Loan Girl — Thu, 05 Jun 2008 23:27:00 GMT

Smith College in Massachusetts and Wake Forest University in North Carolina recently joined the nearly 30 percent of all 760 four-year colleges and universities in the country that no longer require the submission of SAT or other standardized test scores as a condition for admission, according to an article on CNN.com (“More Colleges Move Toward Optional SATs,” May 30, 2008).

Although many other institutions have previously gone SAT and ACT-optional, Smith and Wake Forest are the first top-30 schools on U.S. News & World Report’s Top Liberal Arts Colleges list and Top National Universities list, respectively, to drop the requirement. Smith College ranked 17^th on 2008’s top liberal arts colleges list and Wake Forest came in 30^th out of the nation’s top universities.

"We in admissions have put up a barrier to these students to say all of your hard work and all of your academic achievement is being negated by one test, and we don't feel like that is fair," said Martha Allman, Wake Forest’s director of admissions, in the Chicago Tribune (“University to Drop Required ACT, SAT,” May 27, 2008).

Under the new policy, Wake Forest will still allow applicants to submit SAT and ACT scores if they choose, but will start placing more emphasis on personal interviews, academics, and extracurricular activities.

College consultant Jack Maguire, founder of Maguire Associates, believes that schools which become test-optional, like Wake Forest, focus their admissions decisions on what’s really important.

"I do think it improves a school's image," he said. "It shows… they're really interested in increasing diversity."

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