Latest MeasureOne Data Confirms Private Student Loan Market Returning to Pre-Pandemic Norms

Overwhelming Majority of Private Student Loan Customers Again Making Regular Payments, Originations Rebounding, Use of Forbearance Decreases, and Default Rates at or Near Historic Lows

News provided by

MeasureOne

Dec 21, 2021, 17:00 ET

SAN FRANCISCO, Dec. 21, 2021 /PRNewswire/ -- MeasureOne today released its bi-annual Private Student Loan Report, an industry leading research report leveraging MeasureOne's custom analytics services. This 17th edition of the report confirms the private student loan market has stabilized and returned to pre-pandemic norms: students and families continue to effectively manage payments, the overwhelming majority ba1ck to making regular payments despite the pandemic – and originations have rebounded 5.8% over the same time last year. In addition, forbearance levels have normalized and are currently at 2.4% of loans in repayment with fewer than 2% of loans defaulting annually. Previously the forbearance levels had increased as lenders assisted families who experienced hardship due to the pandemic.

Private student loans, which are fully underwritten to assess creditworthiness and ability to repay, make up approximately 7.6% of total student loans outstanding as of Q2 2021. The remaining 92.4% of the $1.72 trillion in student loans are federal loans owned or guaranteed by the Department of Education.

"The fact that delinquency and defaults remain near historic lows while forbearance rates have returned to pre-COVID levels, reaffirms how strong underwriting and a focus on ability to repay leads to customer success," said Elan Amir, CEO for MeasureOne. "This is a well-functioning market with strong safeguards in place to weather the challenges posed by the pandemic. In addition, the increase in originations -- after a decline last year -- could very well signal we are on our way to a rebound in terms of college enrollment."

The Private Student Loan Report ("Report") reflects data as of end-Q3 2021 for private student loans and does not include federal student loan data. The total outstanding balance for private student loans represented in the Report was $55.41 billion (including in-school loans but excluding consolidation, refinance and parent loans). Undergraduate loans accounted for 89.53% and graduate loans 10.47% of loans originated in AYTD 2021/22.

The performance attributes for this quarter continue the positive recovery shown in the last report. As of the end of Q3 2021, the report found:

Forbearance utilization dropped 65% at end-Q3 2021 to 2.44% from the 2020 Q2 peak of 7.04% as borrowers were able to exit the industry customer relief programs.
Early-stage delinquency (30 to 89 days past due) rate was 2.22% of loan balances in repayment (excluding forbearances as usual), and similarly the late-stage delinquency (90+ days past due) rate was 0.94%. Both are near historic lows.
Annualized gross charge-offs were 1.35% of loan balances in repayment and are near historic lows.
After a 17.3% decrease in originations in AY 2020/21, originations for the first quarter of AY 2021/2022 have increased by 5.8% over the same quarter last year to $3.72B.

The bi-annual Report includes continuous contributions from the five largest student loan lenders and holders: Citizens Bank, N.A., Discover Bank, Navient, PNC Bank, N.A., and Sallie Mae Bank. In addition, the report includes data from 9 other student lender contributors. In total, these contributors represent the vast majority of in-school originations and a majority of the private student loans outstanding in the U.S.

The full Private Student Loan Report is available for download at https://www.measureone.com/resources

About MeasureOne

MeasureOne, the leading consumer-permissioned data exchange platform, transforms the way in which businesses access and use consumer data. MeasureOne empowers organizations to access a wide range of trusted consumer data while prioritizing privacy and consent. Through 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 for businesses to easily leverage consumer-permissioned data, from a developer-friendly API to third party integrations. MeasureOne is headquartered in San Francisco. For more information about MeasureOne, visit www.measureone.com.

SOURCE MeasureOne