How Much Interest Do Banks Charge for Private Student Loans?
As the cost of college continues to climb ever higher, so too do student loan debt levels in the United States.
Currently, the nation has $1.52 trillion in outstanding student loan debt. That collective sum is owed by 45 million student loan borrowers, and those from the Class of 2017 graduated with an average of $27,975 in student loan debt.
To cover the higher education price tag, federal student loans are usually the first option that consumers turn to after scholarships, grants, and savings have been exhausted. But as that price tag keeps swelling, private student loans are increasingly used to fill the gaps left by federal borrowing limits.
With over 100 different private student loan lenders, the market has exploded in recent years. Now, private student loan debt totals around $102 billion, or 7.5% of the country’s outstanding student debt balance. Each year, roughly 1.4 million college students will use a private student loan to help pay for college.
Using our exclusive data derived from close to 200,000 users that have gone through the LendEDU private student loan portal, LendEDU has put together an extensive private student loan report that highlights industry trends.
Below, you can see how key private student loan statistics, like approval rates, average interest rates, and average approved loan amount, have changed in the market from 2016 to 2019.
Private Student Loan Data From 2016 to 2019
Overall approval data
From 2016 to 2019, the approval rate for private student loans was 21.04%.
From 2016 to 2019, the approval rate for students with co-signers on private student loans was 40.51%; 37.35% of all applicants applied with a co-signer.
From 2016 to 2019, the approval rate for students without co-signers on private student loans was 8.66%; 62.65% of all applicants applied without a co-signer.
From 2016 to 2019, the average approved loan amount for a private student loan was $13,780.
Tracking approval rates
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Tracking co-signer/no-co-signer applications
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Tracking the average private student loan amount
Overall interest rate data
From 2016 to 2019, the average interest rate on a private student loan was 8.86%.
From 2016 to 2019, the average VARIABLE interest rate on a private student loan was 8.81%.
From 2016 to 2019, the average FIXED interest rate on a private student loan was 9.97%.
From 2016 to 2019, the average co-signed interest rate on a private student loan was 8.74%.
From 2016 to 2019, the average co-signed VARIABLE interest rate on a private student loan was 8.49%.
From 2016 to 2019, the average co-signed FIXED interest rate on a private student loan was 10.00%.
Tracking no-co-signer interest rates
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Tracking co-signer interest rates
### Overall Qualification Data
From 2016 to 2019, the average APPROVED FICO credit score for a private student loan applicant was 737.
From 2016 to 2019, the average APPLIED FICO credit score for a private student loan applicant was 644.
From 2016 to 2019, the average APPROVED income for a private student loan applicant was $72,947.
From 2016 to 2019, the average APPLIED income for a private student loan applicant was $44,583.
Tracking credit scores
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Tracking income
Methodology
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All data used in this report was compiled from close to 200,000 users who went through LendEDU’s private student loan portal when applying for a private student loan between 2016 and 2019. Data has been provided from private student loan lenders including College Ave Student Loans, Sallie Mae, Discover, Citizens Bank, and SunTrust.
*The application data was pooled from the five aforementioned companies and weighted based on the proportion of users. All of the users were sent to one of the five private student loan lenders from the LendEDU website.
*Each lender provides slightly different reporting and data. Therefore, some lenders did not provide certain data fields. Due to privacy concerns, we are unable to provide applicant weighting or confirm lender-specific data.
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