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CU Snapshot

 Mar '18Feb '18
# of CUs5,5965,757
Total Assets
($ billions)
Total Savings
($ billions)
Net Cap.
Loans to Savings81.5%82.6%
Loan Delinq.0.8%0.9%

         Credit Union Indicators

Student Lending Opportunities

Total student loan debt reached $1.19 trillion this year.

Credit unions that aren't already offering private student loans or student loan refinancing are missing a golden opportunity, according to panelists speaking at the CUNA Lending Council Conference.

Total student loan debt reached $1.19 trillion this year, up from $370 billion in 2005. Reasons for the increase include the rising cost of an education, higher college attendance, and lengthier tracks toward achieving a degree—which, in turn, leads to longer repayment deferment periods, said Jim Holt, chief revenue officer for CU Student Choice.

While the cost of an education is going up, a degree still represents a "fantastic opportunity," Holt said. To put that investment in perspective, Holt noted the average student loan debt is $31,252—less than the price of an average car—and 40% of debt holders owe less than $10,000.

Credit unions can assist members in their pursuit of a degree, by offering loans to pay for their education or refinancing existing student loan debt to save them money.

UW Credit Union, in Madison, Wis., began offering private student loans in 2005. In the past decade, the $2 billion-asset credit union issued more than $300 million in private student loans, with an average loan indebtedness of $24,000, said Mike Long, UW's chief credit officer.

Even if credit unions don't offer loans to students currently in school, they can reach out to members who carry college debt with other financial institutions.

UW Credit Union launched a student loan refinancing program three years ago, according to Long. Members can refinance up to $60,000 for a 15-year period. The average borrower is a 31-year-old graduate with a job.

"This is a huge opportunity that's sitting in front of us," Long said. "For the life of me, I don't know why we haven't jumped on this opportunity."

A study by LendKey, a CUNA Strategic Services alliance provider, reveals there's $836 billion in student loan debt that "could be refinanced," said Jason Hills, LendKey's senior vice president of sales, account management.

Credit unions and borrowers alike could benefit from a student loan refinancing program, according to Hills. Borrowers would save money and credit unions would gain exposure to potential new members.