Student Loans: Now For Some Good News...


South Dakota's Student Loan Finance Corporation Gets The Job Done Right

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Have you seen these headlines?

Roughly speaking, there is currently $1 trillion in outstanding student loan debt. Compared to the total U.S. revolving debt of just over $800 billion, other than home mortgages, student loans have become the second largest category of personal debt in the nation. It’s no wonder the issue is getting a lot of press and accounting for a significant amount of political rhetoric in a presidential campaign year.

The average college graduate has nearly $20,000 in debt. Almost one in five 18- to 24-year-olds is in "debt hardship," up from 12 percent in 1989.

In addition to this, the country is experiencing a slower than expected recovery from the last recession and jobs are still hard to find, so you might say there is a lot a bad news about students borrowing money to further their educations. Why would anyone want to be in this business? Much less, be successful.

It just so happens that a South Dakota corporation has been in the student loan business for 33 years, and despite the seemingly roller coaster ride of change, has done quite well. Student Loan Finance Corporation (SLFC) was founded in Aberdeen, South Dakota in 1978 and has been making, processing, and servicing students of South Dakota and around the nation.

Student Loan Finance Corporation

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Since 1978, SLFC has been working with 647 banks in 37 states and has serviced student loans to over 860,000 borrowers for more than $4,000,000,000 in total loan amount. “The ordinary guy on the street probably doesn’t know that we exist. They have no idea that this company, sitting here on the corner of First and Second in Aberdeen, South Dakota, has provided and serviced that amount of money to students in the U.S.,” says Steve Kohles, SLFC’s Chief Operating Officer.

Originally, SLFC primarily provided capital and servicing for federally guaranteed loans. Says Norg Sanderson, SLFC President/CEO, “A big part of our strategy was that we would buy any loan at any time at any amount and at any status.” By doing so, SLFC provided the funding for South Dakota banks so they wouldn’t have liquidity issues, didn’t have to staff a student loan office or program, and didn’t have to see their good bank customers go down the street to a competitor. As the federal government returned to providing loans directly to students, SLFC shifted its emphasis to providing and servicing private loans through its iHELP Student Loan Program.

iHELP Fills the Gaps in Education Financing

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The iHELP Student Loan is a private, credit-based loan with competitive rates and good borrower benefits. It is offered through local community banks and is designed to cover educational costs that aren't covered by a student's traditional financial aid package, which generally consists of scholarships, grants, and federal student loans

In spite of all the changes the student loan business has undergone over the years, SLFC has managed to remain successful by operating under the same principles that they have held true to for over 30 years: “SLFC exists to optimize the cost of higher education for students and parents by simplifying the decision-making process through integrating necessary information and services while providing unmatched personalized customer service.”

Service and Technology Keys To SLFC Success

SLFC has been long recognized by students, families, and higher education financial aid professionals for providing superior service. “We do a lot of counseling with our customers, trying to making sure they know what they’re getting into,” says This email address is being protected from spambots. You need JavaScript enabled to view it., SLFC/Marketing Director. Typically, an SLFC customer is assigned a counselor who will work with them throughout the period of their loan payback, providing continuity and familiarity. You know that when they say, “We want to help this kid so he doesn’t default on his loan,” they really mean it.

SLFC has invested millions in technology that has enabled the company to originate, process, and manage loans at a faster and more efficient pace than nearly any other provider. According to Dr. James Canton, renowned futurist, author, and consultant, “I’ve had discussion with executives of some of the largest banks in the country. They are totally amazed by the amount of business that SLFC generates with the size of their staff. The Chairman of one of the nation’s largest banks said to me, ‘I have 30,000 people and if every 100 people generated $2,000,000,000 (like SLFC), wow, wouldn’t that be great.’”

While default rates continue to rise (according to the Department of Education, there was an 8.8% default rate for the year ending last September 30, which is up 1.8% from the year before), SLFC borrowers have typically had default rates significantly below the national averages.

 SLFC – More Than Loans

RightChoice_375Recognizing the challenges that students and their families face in preparing for the cost of college and uncertain futures, SLFC has developed online financial and career planning resources such as “iHELPloan.com” and “RightChoice.net.” These easy-to-use web applications provide comprehensive planning resources for students and families that they can begin using as early as the eighth grade. With these resources, which include key information about the cost of college as well as career and income levels by industry and geography, they will be able to custom plan their post-high school education.

The success and durability of Student Loan Finance Corporation has a lot to do with the company's willingness to adapt to the times while staying firmly based in its principles. Says Sanderson, “Student Loan Finance Corporation is not just a ‘financial institution,’ but an Information Technology Company that simplifies the complex education process for parents, students, and lenders to assure that the investments made in education have the maximum opportunity to succeed.”