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RFI/RFP Guidelines

RFI/RFP Guidelines. Provided by CLFE CASFAA 2008, December 8, 2008 Anaheim , CA. Presented by, Thalassa Naylor, Sallie Mae. Why have a lender list? . For your students Competition encourages quality improvements and good service Choice – ability to pick the best lender for them

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RFI/RFP Guidelines

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  1. RFI/RFP Guidelines Provided by CLFE CASFAA 2008, December 8, 2008 Anaheim , CA Presented by, Thalassa Naylor, Sallie Mae

  2. Why have a lender list? • For your students • Competition encourages quality improvements and good service • Choice – ability to pick the best lender for them • Protection from predatory lenders • For your financial aid office • Lenders that use your preferred process • Lenders that you have pre-screened for service and other important factors • Control your office time investment

  3. RFI or RFP? • Request for Information (RFI) Request made during the project planning phase where a buyer still may need to identify product requirements, specifications, and purchase options. RFIs typically indicate that award of a contract will not automatically follow. Often followed by RFP. • Request for Proposal (RFP) An invitation for providers of a product or service to bid on the right to supply that product or service to the individual or entity that issued the RFP.

  4. Why do an RFP? • To ensure fairness in lender selection and create an audit trail for federal compliance • To find lenders that use your school’s preferred process • To find lenders that offer the best quality products and services for your students • To ensure that you are providing your students with a list of committed and reputable lenders

  5. The RFP Process • Planning • Survey Development • Solication • Scoring/Selection • Notification

  6. Planning Planning is bringing the future into the present so that you can do something about it now. - Alan Lakein, time management expert Begin with the end in mind. - Stephen Covey

  7. Planning RFP Committee • Draw from more than just the financial aid office – others with a vested interest in the end results. • FA Office • Business Office/Bursar • Student Representative

  8. Planning • DefineTimeline • When do you need to have your lender list? • How much time to do you need to prepare? • How much time do you need to review? • Build in a recommended 6 weeks for lenders to respond (less than 4 is challenging for lenders if you want quality responses)

  9. Planning 1/1 – 1/15 1/16 – 2/28 3/1 – 3/14 3/15 Plan List Respond Eval Planning & Development Lender Response Time Evaluation Decision

  10. Planning Selection Criteria • What factors will you use to select your lenders? • What is most important to the institution? • What is most important to the your students More on this later…

  11. Planning Develop a scoring methodology • Creating a way to score the responses is important: • a numeric way to compare lender responses that is less likely to be subjective. • You can weight more heavily things that are of more importance

  12. Planning RFI Structure • Clearly numbered response questions will ensure every response can be compared • Organization of questions by topic ensures focused responses and makes review easier • Online/electronic response vs. paper • Supplemental requested materials

  13. Survey Development • Define how you want to base your decision and build survey around these criteria. For example: • Lender stability and commitment • Customer Service • Process Flow • Specific Products Need • Debt Management/Default Prevention • Other criteria

  14. Survey Development General Lender Information • Stability and financial strength • how will they fund the loans • short and long term financial positioning • Experience in Student Lending • Commitment (what do they do beyond just the loan?) • Financial literacy • Outreach • Scholarships • Philanthropy and CommunityService

  15. Survey Development Customer Service • Borrower service experience • School service & support • Online options • Collateral and information • Financial Literacy and Education • Debt Management • Default Prevention

  16. Survey Development Platform & Processing • Define your preferences • Can lenders use your preferred process? • If not, what is their process? • Guarantor choice • Borrower application process • Loan delivery • Servicing

  17. Survey Development Possible FFEL Topics • Funding stability • Guarantor partners • Borrower benefits* • Debt management & default prevention • Other value added services • PLUS • Servicing * • Loan Sales * *may be irrelevant in current market

  18. Survey Development Possible Private Loan Topics • Eligibility Criteria • Pricing • Borrower benefits • Customer service • Repayment options • Cosigners • Program specific loans • Debt management & default prevention

  19. Solicitation Invitation to Respond/Communication • Provide complete information on when, how, to whom, supplemental materials required. • What’s in it for the lenders? • total volume for each loan product • # of lenders to be selected • Length of placement

  20. Solicitation Getting invitations out to lenders: • ListServ (ie. CASFAA) • Personal invitations to lenders – hard copy or electronic (preferred) • CLFE

  21. Scoring, Review and Selection • Each response received should be run though your scoring and review model developed during planning. • Any follow up or clarification requests should be determined quickly so lenders can respond. • Select your final list of lenders!

  22. Notification • Notify all selected lenders promptly in writing (email is fine). • Notify all non-selected lenders promptly in writing (email is fine). • If possible, provide those not selected with reasons for non-selection. Assists them in understanding where they are not competitive, where they didn’t meet your processing criteria, or where they can improve.

  23. Remember • Include at least three unaffiliated lenders (not same ownership). • Disclose that borrowers have the right to choose any lender, including lenders that are not on the lender list. • disclosing the criteria used to select the lenders on the lender list (this can be generically stated ie. Best customer service, met our institutions processing flow standards). • reviewing the lender list frequently

  24. The following CLFE members indicate they provide support, tools or resources for developing an effective lender RFP. • Great Lakes GreatLakesRFPTeam@glhec.org • Sallie Mae http://www.salliemae.com/schools/financial_aid/straight-talk/seven-steps.htm • TGSLC List Assist http://www.tgslc.org/products/listassist/ or contact TG’s Lender Consultant team at lenderrequests@tgslc.org • Total Higher Education (T.H.E.) http://www.theloanprogram.org/FAO/lenderpartners.aspx or contact Lacey Carter at lcarter@theloanprogram.org • USA Funds contact your USA Funds representative or Brent Dove at brent.dove@usafunds.org

  25. CLFE Resources For the latest updated information, please go to our website at www.CLFE.org Thank you!

  26. Acknowledgements This presentation and information compiled by the CLFE RFP Committee: • Thalassa Naylor, Sallie Mae • Lacey Carter, Total Higher Education • Kim Thomas, National Student Loan Program For more info and a more detailed document containing this information, please visit our website at www.CLFE.org

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