Providing services and products for:
Perception There is a lot of skepticism about private student lending due to the relative newness of the asset class, heightened regulatory scrutiny, and the all-too-frequent media headlines lamenting rising student debt and delinquency.
Reality Many lenders are finding success in the private student lending space, not only in delivering a much-needed product set—ranging from traditional in-school loans to innovative consolidation options—that connects with young adults, but also in delivering products that will perform in the long-term.
According to industry analyst Measure One in their December 2014 report, loan performance metrics have continued to improve for the nation’s largest active private student lenders. The six participants analyzed in the report represent approximately 70 percent of the entire private student loan market.
Among the report’s highlights:
Performance While those numbers are strong and improving, what’s even more impressive is the performance of loans originated by credit unions. Unlike some of the largest private student lenders, credit unions are unburdened by legacy loans tied to the reckless heyday of private student lending, and have built sustainable lending portfolios by implementing several key principles from day one, including:
Strong performance numbers are validating this disciplined approach. Nearly 250 credit unions utilize the Credit Union Student Choice lending platform and, combined, have more than $1.5 billion in outstanding private student loans. Of that total, nearly 50 percent ($733 million) is now in full repayment status.
In reviewing undergraduate loans only, comprising $490 million of the most seasoned loans in repayment, as of Q3 2014:
When credit unions first began offering private student loans through the Student Choice platform in 2008, they did so with a desire to help their members responsibly pay for college and a belief that proper underwriting would yield solid performance and long-term member relationships. Now, nearly seven years later, more than 60,000 borrowers have now worked with a credit union to fund the most important decision in their young financial lives. The rewards of that relationship are not only paying off in the short-term, but will yield positive results for many years to come, for both credit unions and members.
For more information on Credit Union Student Choice, please contact Tonja Wheatley, vice president of Credit Union Solutions and Membership, at 909-212-6023 or email@example.com.
Article content provided by Credit Union Student Choice.