HESC Initiates Default Prevention Grant Program

John Austin

HESC is happy to announce a new program targeted at reducing the student loan delinquencies and defaults… the HESC Default Prevention Grant. Under this program, in 2007 HESC will provide grants ranging from $2,500 to just under $50,000 to selected postsecondary educational institutions.

HESC will select institutions based on the merits of their proposals in two areas:

identifying risks that contribute to federal student loan repayment delinquency
developing and implementing new programs that have the best potential to significantly reduce the dollar amount of federal student loans that are purchased as defaults

In order to extend the impact of the grant, HESC encourages, but does not require institutions to match any Default Prevention Grant award with in-kind or cash contributions and to establish a credit-bearing course in financial literacy that will help students better understand how to manage their personal finances.

Eligibility to Apply

HESC invites all postsecondary educational institutions that are HESC FFEL clients as well as all other postsecondary educational institutions located in New York State that participated in the Federal Family Education Loan (FFEL) or the Federal Direct Student Loan programs in federal fiscal years 2005-06 and 2006-07 to apply.

Grant Proposal Deadline

To be eligible for consideration, grant proposals may be submitted to HESC beginning on December 28, 2006. The deadline for all submissions is January 25, 2007. Grants will be awarded on or about March 26, 2007. Grants are subject to availability of funding.

If you have questions, contact HESC by emailing defaultpreventiongrant@hesc.org or calling John Austin at (518) 473-0810. Visit HESC.org on or after December 21, 2006 for a compilation of the questions and answers.

HESC’s student loan default prevention staff looks forward to working with you and your institution on this important initiative.