ATLANTA -- More than 600 Georgians, from doctors to beauty-shop shampooers, have risked losing their state professional licenses by defaulting on their student loans.
But one notice from the Georgia Secretary of State's Office convinced many it was time to start paying the money back.
State agencies sent out letters in late March warning Georgians with state licenses that they would lose the right to practice their professions if they didn't settle their outstanding loans.
The 626 letters sent to cosmetologists, dentists, plumbers, manicurists, chiropractors and nurses represented a little more than $3 million in unpaid loans.
That's a fraction of the $127 million in defaulted student loans handled by the Georgia Higher Education Assistance Corp.
However, state officials wanted to send a message.
"What students need to understand is there are consequences when you don't meet your financial obligation," said Glenn Newsome, director of the Georgia Student Finance Commission.
The program was patterned after a similar effort aimed at deadbeat parents.
The Secretary of State's Office oversees the regulating boards that license 65 trades and professions including doctors, nurses, dentists, engineers, chiropractors and foresters.
More than 350,000 Georgians hold professional or occupational licenses.
The threat that professionals would lose their licenses convinced many deadbeat parents to pay child support, Secretary of State Cathy Cox said.
During two years, about 75 to 80 professionals' licenses were suspended and the program was credited with $4 million in child-support collections.
The loan deadbeat program has had similar success, said Ruth Vincent, director of the Georgia Higher Education Assistance Corp.
State officials this year began comparing licensing records with the names of about 30,000 people who have defaulted on student loans.
On average, those former students owed $3,200 when they defaulted on their loans, Mr. Newsome said.
Of the 626 letters sent out -- more than half to holders of cosmetology and nursing licenses -- about 300 borrowers have been eliminated from the deadbeat list.
"Some have made payments or there are payments on the way," Ms. Vincent said. "We don't eliminate them (from the list) based on a promise."
In some cases, borrowers on the list had cancelable loans. They took the loan in exchange for services -- such as working in an underserved area of the state after graduation -- and inaccurate records or paperwork were kept on their cases.
Ms. Cox said she wasn't surprised by the number of loan deadbeats paying up.
"They don't want to lose their license," she said. "They've avoided notices and things to get them back on track. When it's going to jeopardize something important to them ... they have a `Come to Jesus' meeting and pay up."
The records of student loan defaulters who did not respond are being transferred to the professional boards to begin the process of pulling their licenses.
Starting March 1, the name of anyone applying for a state license also was checked against default records.
"We're not really about denying a person a license to practice a profession," Mr. Newsome said. "We both lose if they can't practice their profession and repay their loan."
The program isn't trying to collect loans processed directly by schools or from out-of-state programs.
The license program won't even bring in the most money of all the default collection efforts. About $18 million was returned last year from default cases handled by private collection agencies.
The program likewise doesn't hit many professions that generally require college degrees. For instance, lawyers don't get licenses from the Secretary of State's Office.
It's not surprising that many of those on the list have licenses in cosmetology and related fields because they often are not highly paid, Mr. Newsome said.
"When they make a low salary, paying back a student loans falls way down on their list," he said.
James Salzer is based in Atlanta and can be reached at (404) 589-8424 or firstname.lastname@example.org.