ATLANTA — Unlike other credit sectors, student lending delinquencies and write-offs have increased significantly over the past 12 months, according to Equifax's latest "National Consumer Credit Trends Report." The report found:
• Write-off rates among student loans increased more than 29% month-to-month from June-July 2012.
• Student loan 60-day delinquency rates increased more than 14% year-to-year from July 2011-2012.
• Student loan balances increased $58.5 billion year-over-year from July 2011-2012.
• The total number of student loans has increased nearly 24% from July 2011 (89 million) to July 2012 (116 million).
• At $9.3 billion, student loan write-offs year-to-date through July 2012 are 10% higher than same time a year ago ($8.4 billion).
• Severe derogatory balances, the major component of write-offs, on student loans year-to-date through July 2012 ($7.3 billion) are 14% higher than same time a year ago ($6.3 billion).
"Student loans is one area of lending not affected by tighter underwriting standards since the start of the recession," said Crews Cutts. "The investment in higher education pays off over a person's lifetime, while the tuition cost has to be paid up-front, leading to big demand for student loans. Unfortunately, the current job market has not been kind to new graduates and their student loans start to come due once they graduate — if they don't have a job by the time the first installment is due, they can find themselves in quite a jam."
