Latest MeasureOne Data Confirms Private Student Loan Market Return to Pre-pandemic Standards
Overwhelming majority of private student loan clients re-making regular payments, origins of rebound, use of forbearance cuts and default rates at or near historic lows
SAN FRANCISCO, December 21, 2021 / PRNewswire / – MeasureOne today released its Semi-Annual Private Student Loans Report, a cutting-edge research report leveraging MeasureOne’s custom analysis services. This 17th edition of the report confirms that the private student loan market has stabilized and returned to pre-pandemic norms: students and families continue to manage payments effectively, overwhelming majority are resuming making regular payments despite the pandemic – and departures have rebounded 5.8% from the same time last year. In addition, forbearance levels have normalized and currently stand at 2.4% of loans in repayment with less than 2% of loans in default each year. Previously, forbearance levels had increased as lenders helped families struggling due to the pandemic.
Private student loans, which are fully underwritten to assess creditworthiness and repayment capacity, represent about 7.6% of total student loans outstanding in the second quarter of 2021. The remaining 92.4% of the $ 1.72 trillion Student loans are federal loans held or guaranteed by the Department of Education.
“The fact that delinquencies and defaults remain near all-time lows as abstention rates have returned to pre-COVID levels reaffirms just how strong underwriting and the focus on the ability to reimbursement lead to customer success, ”said Elan Amir, CEO of MeasureOne. “This is a well-functioning market with strong safeguards in place to overcome the challenges posed by the pandemic. Moreover, the increase in creations – after a decline last year – could very well indicate that we are on the way to a rebound in terms of university enrollment. “
The Private Student Loans Report (“Report”) reflects data at the end of the third quarter of 2021 for private student loans and does not include federal data on student loans. The total outstanding private student loan balance represented in the report was $ 55.41 billion (including school loans but excluding consolidation, refinancing and parent loans). Undergraduate loans accounted for 89.53% and graduate loans 10.47% of loans were from AYTD 2021/22.
The performance attributes for this quarter continue the positive recovery shown in the last report. At the end of the third quarter of 2021, the report revealed:
Forbearance use fell from 65% at the end of the third quarter of 2021 to 2.44% from a peak of 7.04% in the second quarter of 2020 as borrowers were able to exit aid programs to customers in the sector.
The early stage default rate (30-89 days late) was 2.22% of outstanding loan balances (excluding abstentions as usual), and similarly, the late-stage default rate (over 90 days late) was 0.94%. Both are near historic lows.
Annualized gross write-offs represented 1.35% of outstanding loan balances and are close to historic lows.
After a 17.3% drop in fixtures in AI 2020/21, fixtures in the first quarter of AI 2021/2022 increased by 5.8% compared to the same quarter last year for to reach $ 3.72 billion.
The semi-annual report includes the ongoing contributions of the five largest lenders and student loan holders: Citizens Bank, NA, Discover Bank, Navient, PNC Bank, NA and Sallie Mae Bank. Additionally, the report includes data from 9 other student lenders. In total, these contributors represent the vast majority of school arrangements and the majority of private student loans outstanding in the United States.
The full report on private student loans is available for download at https://www.measureone.com/resources
MeasureOne, the leading consumer-enabled data exchange platform, is transforming the way businesses access and use consumer data. MeasureOne enables organizations to access a wide range of trusted consumer data while prioritizing privacy and consent. Using MeasureOne’s platform, businesses can confidently and reliably integrate and verify consumer information such as income, employment, education, and student enrollment. MeasureOne offers flexible implementation options that make it easy for businesses to leverage data authorized by consumers, from a developer-friendly API to third-party integrations. MeasureOne is headquartered at San Francisco. For more information on MeasureOne, visit www.measureone.com.
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