The Default Prevention Grant program was created from the federal Balanced Budget Act of 1997. Congress authorized state-designated student loan guaranty agencies to initiate and finance new programs and activities related to student loan default prevention. Pursuant to that authority, the Missouri Department of Higher Education offered annual default prevention grants for 10 fiscal years to Missouri institutions with high cohort default rates or high claims-paid volume. The program is now open to all Missouri institutions and is very competitive. Letters of invitation to participate in the Default Prevention Grant program are sent each spring. All interested institutions are required to submit a proposal. Up to $25,000 may be awarded for the top-scoring submitted proposals.


Since the program’s inception, the MDHE has awarded nearly $10 million to Missouri institutions and helped more than 50 postsecondary institutions implement and sustain debt management programs, financial literacy workshops, student success and retention efforts, and default prevention activities.


The Default Prevention Grant program ended in June 2018.