VAN NUYS, Calif., Feb. 2, 2024 /PRNewswire/ — With the pandemic-era federal student loan moratorium having come to an end in late 2023, millions of student loan borrowers have had to prepare for interest to resume accruing on their student loans, and for monthly student loan bills becoming due again starting in October 2023. Besides the directly affected 40+ million consumers, lenders and loan servicers have been bracing for the impact of the return to normalcy.
With Q4 2023 in the books, LoanMart has taken an initial look at title loan payment performance and title loan demand for borrowers with vs. without student loans. Thus far, the data does not show a material impact of the end of the student loan pause on the title loan borrowers.
Specifically, on the demand-side, 21.9% of the new loans processed by LoanMart in 2023 before the end of the student loan pause came from borrowers with outstanding student loan debt. Since the end of the student loan pause, the share of borrowers with outstanding student loan debt has accounted for only 21.2%, a reduction of 0.7%.
Title loan delinquencies, as measured by the 60+ delinquency rate, also show no negative impact of the resumption of student loan payments on title loans serviced by LoanMart. While 60+ delinquencies for borrowers without student loans were virtually unchanged at the end of December 2023 compared to the average of January-September 2023, 60+ delinquencies for borrowers with student loans in December were about 7.5% better vs. the same reference period.
In summary, LoanMart’s data thus far suggests that title loan customers with student loan debt have adjusted well to the end of the federal student loan pause.
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SOURCE LoanMart
