Due to escalating costs of higher education, students and families have increasingly relied on private education loans to pay for college. Private loans provide a needed source of financing today, but many students and parents do not realize the full burden they are undertaking. For this reason, Congress passed the Higher Education Opportunity Act (HEOA), tasking the Federal Reserve Board to develop new disclosures for private loans based on consumer testing. Rockbridge was selected to develop new disclosure forms guided by consumer research and testing.
Rockbridge developed, tested and refined disclosures using a cognitive interview approach. One on one interviews were conducted with college students who relied or might rely in the future on private education loans and with parents involved in planning the education finances for their children. Rockbridge worked with a design agency, EightShapes, LLC, to create multiple designs for forms that addressed key legislative goals such as highlighting the total amount of credit incurred, loan terms, and future payments. Rockbridge tested the forms in one-on-one interviews in three stages:
- First, we asked about the decision process of getting a private education loan to provide insights that would ensure more user-friendly designs based on the real-world environment.
- Second, usability testing was performed to assess the effectiveness of the disclosure forms. Student and parent borrowers went through a simulated shopping experience where they reacted to the disclosures populated with actual information and provided their feedback (“talk aloud” protocol) while reviewing the documents.
- Third, structured evaluation measures of form effectiveness were captured to track progress in improvements and to prioritize changes going forward.
Rockbridge maintained a high level of communication with the client and our design consultant throughout the course of the project – communicating key findings from the cognitive interviews and providing recommendations to guide the iterative design of the disclosure forms. Rockbridge delivered a narrative report with illustrations to document the process for developing the final disclosure forms. The narrative emphasized how various ratings improved across rounds of interviewing, and identified the rationale behind language, layout, and other design decisions.
Key to the success of the project was Rockbridge’s expertise in usability testing and extensive experience in financial services and higher education decision-making. By offering a thorough, readable report grounded in a solid methodology, the Board was able to successfully introduce the new disclosures to the market, helping consumers make more informed decisions. The resulting disclosure forms were innovative in appearance yet highly effective in aiding a group of consumers who are inexperienced in financial decision-making.