MeasureOne Private Student Loan Report Shows Continued Strong Performance Trends Through Third Quarter 2015
Delinquency Rates at Lowest Since Before 2008 Economic Crisis
SAN FRANCISCO, Dec. 21, 2015 /PRNewswire/ -- MeasureOne, a specialized data company focused exclusively on student loan data, today released its semi-annual private student loan performance report. The Private Student Loan Performance Report – Q3 2015 shows continued strong performance trends in repayment, delinquencies and charge-offs for private student loans through Q3 2015. Year-over-year, charge-offs declined 5.9 percent and early and late-stage delinquency rates declined by 12.9 percent and 10.9 percent, respectively.
Further, the report shows that the private student loan market at $ 99.7 billion remains a small segment of the total student loan market compared to the federal student loan program. Specifically, private student loans represent, roughly 7.6 percent, of the $1.31 trillion student loan market.
Among the report's highlights:
- Early-stage delinquencies (30 to 89 days past due) declined to 2.8 percent from 3.2 percent, a 12.9 percent year-over-year improvement.
- Serious delinquencies (90+ days past due) declined to 2.12 percent from 2.38 percent, a 10.9 percent year over year improvement.
- Overall, delinquency rates are the lowest since before the 2008 economic crisis.
- Annualized charge-off rates declined to 2.2 percent from 2.4 percent, a 5.9 percent year over year improvement.
- Forbearance continues to be used judiciously with 2.2 percent of loans in forbearance as of Q3 2015.
- At the end of Q3 2015, approximately 76 percent of outstanding private student loans were in repayment status.
The private student loan performance report analyzes loan data from MeasureOne's Private Student Loan Consortium, a group of the nation's six largest active private student lenders and holders of private student loans. The group includes: Citizens Bank, N.A.; Discover Bank; Navient; PNC Bank, N.A.; Sallie Mae Bank, and Wells Fargo Bank, N.A. Together, the six consortium participants represent approximately 67 percent the total outstanding balance of all private student loans. From Q3 2014 to Q3 2015, outstanding balances for the six consortium participants grew by 3.5 percent to $66.5 billion.
"Even though the private market makes up less than 8 percent of the total $1.31 trillion student loan market, it is a vital financing option," explained Dan Feshbach founder and CEO of MeasureOne. "Our data confirms what we hear from college officials, lenders and borrowers, that the number of private student loan borrowers in distress or who are seriously delinquent continues to decline and has hit an all-time low."
In addition to robust underwriting standards, the use of cosigners and school certification continues to contribute to the overall performance of private student loans. Nearly 94 percent of originated undergraduate private student loans included a cosigner in the 2014-15 academic year, and that rate has been above 90 percent since the 2009-10 academic year. School certification has been universally adopted for both undergraduate and graduate private student loans. Under this process, the lender obtains a certification from the school of the student's needed loan amount before disbursing proceeds directly to the school. This certification and disbursement process serves as an important protection against over-borrowing.
The full MeasureOne Private Student Loan Performance Report – Q32015 is available for download at www.measureone.com.
MeasureOne, San Francisco, collects, analyzes, and distributes student loan data to provide insight into the nation's $1.31 trillion student loan debt. The company created the industry's only standardized database of more than 500 securitizations and developed the nation's largest private student loan data cooperative of contributed loan data from the largest lenders and holders of private student loans. MeasureOne was founded by Dan Feshbach, creator of the Loan Performance databases, the mortgage industry's largest cooperative databases, which are now part of Core Logic, Inc. For more information about MeasureOne, visit www.measureone.com.
Campbell Lewis Communications
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