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CBA Statement on Dept. of Education Student Loan Report
Washington, D.C. (October 1, 2015) – Richard Hunt, President and CEO of the Consumer Bankers Association (CBA), released the following statement in response to a Department of Education report about federal and private student loans:
“With nearly 98 percent of private student loans being successfully repaid and tuition prices having risen 1,120% since 1978, we encourage the Department of Education, Department of Treasury, CFPB and Members of Congress to focus their attention on the root of the problem for students and borrowers, which is college affordability.
“Private student borrowers—comprising just seven percent of the market—have real options and are provided arguably the strongest consumer protection: a robust underwriting process that includes an ability-to-repay test. Private loans made by CBA members have a delinquency rate of less than 3 percent, the true test of successful lending and servicing. Our banks are committed to helping America’s students succeed by helping them work through problems that may arise. For example, our member banks relieve co-signers of responsibility for loans when the student borrower dies, and none demand immediate repayment when a co-signer dies. Banks’ robust underwriting standards, plus strong servicing programs to assist their borrowers throughout the life of the loan, are helping families meet their obligations,” said CBA’s President and CEO Richard Hunt.
CNBC Commentary: Richard Hunt - How to fix the student loan mess