MeasureOne Private Student Loan Report Shows Continued Strong Performance Trends
Year-Over-Year Delinquencies and Charge-Offs Decline
Jun 10, 2015, 08:00 ET
SAN FRANCISCO, June 10, 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 –Q1 2015 shows continued strong performance trends in repayment, delinquencies and charge-offs for private student loans through Q1 2015. Year-over-year, charge-offs declined 14.5 percent and early and late-stage delinquency rates declined by 12.7 percent and 13.4 percent, respectively.
Further, the report shows that the private student loan market remains a small segment of the total student loan market, roughly 7.2 percent, of the $1.27 trillion student loan market.
Among the report's highlights:
- Early-stage delinquencies (30 to 89 days past due) declined to 2.61 percent from 2.99 percent, a 12.7 percent year over year change.
- Serious delinquencies (90+ days past due) declined to 2.20 percent from 2.54 percent, a 13.4 percent year over year change.
- Annualized charge-off rates declined to 2.71 percent from 3.17 percent, a 14.5 percent year over year change.
- Forbearance continues to be used judiciously with 2.22 percent of loans in forbearance as of Q1 2015.
- At the end of Q1 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 71 percent the total outstanding balance of all private student loans. From Q1 2014 to Q1 2015, outstanding balances for the six consortium participants grew by 2.12 percent to $65 billion.
"The private student loan market is a small sliver of the massive $1.27 trillion student loan market, but continues to stand-out in showing very positive trends for all key performance indicators. The private student loan market is back to its pre-crisis levels in terms of high repayment rates and low delinquency rates," said Dan Feshbach, MeasureOne founder and chief executive officer. "Applying standards and practices common with other types of consumer loans, like focusing on a borrower's ability to repay, the private student loan market continues to improve its already-strong performance while helping more families afford higher education."
In addition to robust underwriting standards, the use of cosigners and school certification by the six Consortium participants continues to contribute to the improved performance of private student loans. The report showed that nearly 94 percent of newly 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. The certification and disbursement process serves as an important protection against over-borrowing.
The full MeasureOne Private Student Loan Performance Report – Q1 2015 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 $1.27 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 LoanPerformance databases, the mortgage industry's largest cooperative databases, which are now part of CoreLogic, Inc. For more information about MeasureOne, visit www.measureone.com.
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