A new semiannual report detailing the state of private student loans was released by MeasureOne on Wednesday, June 27, and the results provided some much needed encouragement.
MeasureOne is a higher education data and analytics firm with a very pointed focus on the $1.41 trillion student loan industry. Their new report released on Wednesday showed that families and student debtors continue to improve their management of private student loans.
The data revealed that both delinquency and default rates on private student loans are nearing all-time lows. Regarding Q1 of 2017, the delinquency rate where the borrower is 30 to 89 days past due on payment stands at 2.5 percent of total loans in repayment. In the same quarter, the delinquency rate where the borrower is 90 days or more past due currently sits at 1.9 percent of total loans in repayment.
Both of these numbers are near or at the lowest recorded statistics for a first quarter, including both undergraduate and graduate private student loans, since 2008.
Additionally, private student loan originations for the 2016-17 academic year grew by 5.6 percent from this point last year to reach $6.91 billion. In terms of these new originations, undergraduate private student loans make up 88.8 percent while graduate loans are responsible for 11.2 percent. It is worth mentioning that roughly 93 percent of the new private student loans for undergraduates had a cosigner.
Furthermore, the share of private student loans in forbearance declined to 2.2 percent. Out of all the educational loans in repayment, 2.2 percent of them have been marked as annualized defaults, the lowest for Q1 since 2008.
“Student loan performance is at its strongest point in eight years. All signs indicate a very stable and well performing private student loan market,” said Dan Feshbach, CEO for MeasureOne. “It’s important to have a healthy private student loan market for students and their families to turn to, giving them multiple financing options to achieve their education goals, whether for high school or adult-student learners pursuing a college degree or graduate students seeking an advanced degree,” he said.
At the end of the first quarter of 2017, the total outstanding student loan debt balance for private student loans was $63.95 billion. This marked a growth of .5 percent from this point last year. Most, 86.7 percent, of this debt is from undergraduate loans, while the remaining 13.3 percent can be attributed to graduate loans.
According to LendEDU, the total amount of outstanding private student loan debt currently sits at roughly $165 billion. The total student loan debt in the U.S. is at $1.41 trillion, meaning the remaining debt can be attributed to federal student loans.
Combining both federal and private student loans, there are approximately 43.3 million student loan borrowers who each owe an average of $28,400 in educational loans. Roughly 60 percent of college graduates in this country have student loan debt.
Author: Dave Rathmanner
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