MADISON, Wis. (8/19/11)--CUNA’s Lending Council has released a white paper that charts the evolution of the private student loan market. A change in the student loan business model occurred after the credit crisis of 2008, according to the paper, “Should Credit Unions Offer Private Student Loans?” written by Mike Long, executive vice president and chief credit officer of $1.3 billion asset UW CU, Madison, Wis., and an executive committee member of CUNA’s Lending Council. After the credit crisis, many lenders left the student loan business, while those that remained employed conservative underwriting. UW CU is second in the U.S. with almost $50 million in outstanding private student loans. The credit union’s average interest rate on student loans, 4.8%, is the lowest of the top 10 lenders in the private student loan market, the paper said. The most frequently asked questions about UW CU’s private student lending portfolio concern loan performance, said Long. About 32% of the loans are currently in active repayment, he said. “As of June 2011, our delinquency ratio--calculated on loans in repayment--is less than 1.2% and charge-offs are 0.01%,” he said. “The average loan is $6,200, and 86% of the loans have co-signers and credit scores average 732. We processed more than 18,000 applications and approve roughly 50% of the applications.” For more information about the paper, use the link.