A state program to consolidate student’s guaranteed loans might lessen chances of defaulting on the loan.

Barbara Bell, default prevention program manager in the Illinois Designated Account Purchase Program, said the IDAPP is a state service connected with the Illinois State Scholarship Commission. She said if a student has borrowed money, he must repay the funds after graduation or upon leaving college.

“Some students believe borrowing is a gift. Borrowings are not gifts—they have to be repaid,” Bell said.

Bob Clement, Illinois State Scholarship Commission’s agency relations director, said IDAPP purchases lenders’ delinquent loans or purchases guaranteed loans accounts for any reason.

Bell said after the secondary service purchases a loan, it services the loan and keeps in touch with each borrower to keep them on a payment schedule.

She said she hopes fewer defaults will occur if a good rapport is established between the organization and students.

“(IDAPP) buys loans from lenders. When a lender sells a loan it frees up money for other students,” Clement said.

Students with high monthly payments or payments to several loans have the opportunity to consolidate their payments through the unILoan program, Bell said.

Payments to several loans can be consolidated into one payment or large payments can be spread over a long period, she said.

Clement said unILoan’s can help reduce the risk of default by providing students with a payment plan they can afford. He said qualified borrowers can spread out their payment plan up to 25 years.

The ISSC is marketing software systems designed to handle student loan servicing on the lender’s personal computer, Clement said.

The software includes features such as automated federal interest billing, annual call reports and check distribution, he said.

Beginning in July 1988 IDAPP will service PLUS and Supplemental Loans for students, Clement said. In the future, IDAPP will be able to make more services available, but Clement did not comment on what the services would entail.