Collections dept. helps students pay off loans

With the national student debt expected to surpass $1 trillion, as reported by USA Today on Oct. 18, Eastern Michigan University’s Collections Department works with students to
help pay off debt as quickly as possible. According to Student Business Services Director Michael Hague, much of the debt is the result of loans.

“The trillion dollars that people are talking about is almost exclusively department of education debt, which would be what students here would think of as, their Stafford loans, their subsidized and unsubsidized Stafford loans, and parent plus loans, which are awarded through financial aid, used primarily to pay off a student’s bill and then to a larger extent, refund it for living expenses and educationally related cost for the term,” Hague
said.

The only loans dealt with by the University Collections Department are Perkins loans. The Perkins loans is intuitionally based on and developed by the federal government. The government, however, has failed to give out any new money recently.

“It used to be that the Department of Education would give us funds and we would award it to students, and then we would collect the money back, and as we collected the money, we re-awarded it,” Hague said.

Without new money, the department is limited to awarding students only as much money as the department collects.

In addition to Perkins loans, the department also works with student account debt, including students who have a negative balance while trying to register for another semester. Students who do not possess a positive balance at the end of a term are prohibited from enrolling for classes the next term.

To prevent a situation like that from happening, students in need of loans are best off borrowing through financial aid.

“That’s a much cheaper, much better way to go to school then try to owe the university, because we can’t extend credit beyond a semester,” Hague said. “Really, all we’re dealing with are the students who have either dropped out or are having some kind of problem, don’t have financial aid, and don’t want financial aid, used up their financial aid…”

The collections department also works with students who drop out of school in debt.

Students who drop out or go into debt during the middle of a semester cannot be forced to
withdraw after the drop/add period of classes. Once a student is in debt, the collection
department works to accommodate them to help maintain a positive balance, allowing them to enroll the following semester.

“If we can contact them, then there’s no problem we can’t solve,” Hague said. “We can solve every problem as long as students work with us whether they’ve dropped out or not. We’ll find a way to get their balance paid or to make payment arrangements or whatever we need to do to.”


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