Responses to questions submitted by prospective bidders:

Please confirm that FAME is not required to be licensed or registered as a student loan servicer.

Confirmed for State of Maine’s Consumer Credit Code.

Please confirm that FAME is excluded from being classified as a private education lender.  Confirmed for State of Maine’s Consumer Credit Code.

What is the anticipated award date?

Within 60 days of proposal deadline

What is the preferred go live date?

As soon as possible.

In cases where an alternative pricing structure may benefit FAME, may we proposal alternate to the straight $ amount currently referenced on the Cost Proposal?

Yes

Of the $80MM of educational loans, what is the current total # and $ amount of defaulted loans? 

Actual full portfolio of loans closer to $120MM—including loans not in repayment status, not in default, etc.

Estimated placements of defaulted loans:

• Second placements: 180 accounts – $2,821,769 (previously placed with 1 to 3 different agencies) These loans are not actively under payment arrangements.
• Initial placements: 21 accounts – $304,166.35 (defaulted between 1/1/2026 and contract award date not yet placed with any agency)

Historically, what is the # and $ value of accounts that default annually?

Average monthly first placements – 3 to 4 loans @$15,000 each

What is the average balance of accounts to be placed for collections?

• Second placements: $15,676 average P&I
• First placements: $14,484 average P&I

What is the average loan ratio per borrower?

1.5 loans per borrower

Please confirm that digital communications (Email, SMS, etc.) are acceptable.

Confirmed.

Please confirm that remote staff servicing the portfolio is acceptable.

Possibly.  We would want you to provide information on security, oversight, and training for those who would be providing responses to customer inquiries.

Is nearshore service acceptable?

Possibly.  We would want you to provide information on security, oversight, training, and your assessment of verbal and written language for those who would be providing responses to customer inquiries

At what point of delinquency are accounts placed, and have they been previously placed with another agency (first placement versus secondary)?

There are possibly three different loan program types that could be placed for collections. 

Program Type 1: Defaulted Tax-exempt bond financed Private Education Loans – The Maine Loan, Maine Medical Loan, and Maine Consolidation Loan.    These default after 180 days of delinquency. 

Program Type 2: Defaulted Private Education Loans purchased from a bank or credit union by FAME per a guarantee agreement.  These default after 150 days of delinquency.

Program Type 3: Defaulted State Appropriation Funded Private Education Loans.  These default after 150 days of delinquency.

Is there a current or incumbent collections vendor, and can FAME share historical recovery or liquidation rates on this portfolio to help benchmark expectations?

Most of our second-placement loans are currently placed with Daggett & Parker for collection services. This vendor is exiting the business and those accounts not currently in an active repayment arrangement (approx.. $2.8MM) will be moved to the newly selected vendor.  Many of these accounts have previously been placed with one or more collection agencies and, in some cases, have been through two or three prior placements before being referred to Daggett & Parker.

The 21 loans identified for initial placement are currently being managed by FAME and are awaiting assignment to an external collection agency.

For context, FAME’s overall education loan portfolio maintains a default rate of approximately 4%. Historically, our collection efforts have resulted in recoveries of approximately 45% of defaulted principal balances, reflecting the value of active and sustained collection activity throughout the life of a defaulted account.

Does FAME prefer a single blended contingency rate or tiered pricing, and for accounts referred to litigation, are court costs advanced by the agency and reimbursed from recoveries, or paid directly by FAME?

Historically, collection agencies have been compensated on a contingency basis, retaining a percentage of amounts collected. The fee structure typically varies based on the status of the placement (e.g., initial placement versus subsequent placement). Court costs are generally advanced by the agency and then reimbursed from recoveries.

That said, we are open to considering alternative fee arrangements and would welcome the opportunity to discuss other approaches that may better align with our objectives.

What is the anticipated contract term, and will this be a single award or multiple awards?

FAME anticipates awarding a contract for an initial three-year term, with the option to extend the agreement for up to two additional one-year periods, subject to mutual agreement and satisfactory performance.

The contract may result in either a single award or multiple awards, depending on the proposals received and FAME’s determination of the approach that best serves the portfolio.

The selected agency can expect an initial placement of a significant group of defaulted loans, followed by ongoing monthly placements of newly defaulted accounts. The volume of monthly placements will vary and may range from a single loan to ten or more loans in a given month, depending on portfolio performance and default activity.

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