SAN FRANCISCO, Dec. 13, 2016 /PRNewswire/ -- MeasureOne, a higher education data and analytics firm focused on the $1.4 trillion-dollar student loan market, today released its semiannual Private Student Loan Report showing continued strong performance among private loans originated to finance undergraduate and graduate education. According to MeasureOne data, delinquency rates declined between 9 and 15 percent for both undergraduate and graduate loans, originations increased by more than 5 percent, and charge-offs declined by 21 percent with the lowest third-quarter charge-off rate since before the financial crisis.
Research in this report reflects data as of Q3 2016 for private student loans and does not include federal student loan data. Private student loans, which are credit-based loans underwritten by lenders, make up roughly 7.5 percent – approximately $102 billion – of total student loans outstanding. The remaining 92.5 percent of the $1.4 trillion in total student loans are federal loans.
Private Student Loan Data Highlights as of Q3 2016
- Overall delinquency rates declined to their lowest levels since peaking between 2008-2010.
- The early-stage delinquency rate (30 to 89 days past due) declined to 2.7 percent, down 9 percent since a year ago and down 44 percent compared to five years ago.
- The late-stage delinquency rate (90 days or more past due) declined to 1.9 percent, down 15 percent since a year ago and down 51 percent compared to five years ago.
- The overall private student loan outstanding balance increased by 0.8 percent to $102 billion with undergraduate loans continuing to make up a greater percentage of the overall balance at 86 percent compared to graduate loans at 14 percent.
- Private student loan originations in academic year 2016/2017 increased to more than $3 billion as of Q3 2016, an increase of 5.5 percent compared with academic year 2015/2016. Of this total, 93 percent were cosigned and 99 percent were school certified. Undergraduate loans accounted for 89 percent and graduate loans accounted for 11 percent.
- Annualized charge-offs (defaults) declined by 21 percent year over year and stand at 1.9 percent of loans in repayment, the lowest Q3 charge-off rate since before the financial crisis.
The full MeasureOne Private Student Loan Report is available at http://measureone.com/psl.html
"The private student loan market continues to demonstrate its ability to grow steadily while maintaining strong loan performance," said Dan Feshbach, CEO for MeasureOne. "College remains an important goal for most families, and the ability to bridge the financial gap when financing college is key. That's when families turn to private student loans, and according to our data, they are doing so responsibly and paying on time. Lenders have been diligent in helping to ensure students are set up to succeed in repayment which bodes well for continued growth in the industry," he said.
The data in the report is sourced from the MeasureOne Private Student Loan Consortium, a data cooperative of lenders and holders of private student loans. Members include the six largest student loan lenders and holders – Citizens Bank, N.A., Discover Bank, Navient, PNC Bank, N.A., Sallie Mae Bank and Wells Fargo Bank, N.A. In aggregate, the members of the consortium represent approximately 65 percent of all private student loans outstanding in the U.S.
MeasureOne, founded in San Francisco with offices in Dallas, TX, specializes in data and analytics serving the $1.4 trillion-dollar student loan market, the second largest form of consumer credit in the U.S. The company developed the first and only Private Student Loan Consortium, a data cooperative of the nation's largest lenders and holders of private student loans. MeasureOne is applying data science and industry expertise in order to increase understanding of student lending, risk assessment, repayment, capital market investments and public policy development. For more information about MeasureOne, visit www.measureone.com.
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