While the study indicated a portion of federal student loan borrowers may not have enough liquidity to handle the resumption of their loan payments, borrowers will be getting an on-ramp or transition period. The U.S. Department of Education has directed student loan delinquencies not be reported to the credit bureaus for 12 months (until Sept. 30, 2024), helping protect consumers’ credit as they manage these new payments.1
TransUnion can provide useful insights into student loan borrowers during this on-ramp period. Through a Custom Consultative Analysis, lenders will to be able to assess which consumers haven’t demonstrated the capacity to pay their expected student loan monthly payments. Click here to learn more.
Beyond a custom analysis, TransUnion can provide trended credit data institutions can incorporate throughout consumers’ credit lifecycles to identify patterns in borrowing behaviors, specifically:
- TruVisionTM Premium Student Loan Attributes — This set includes information on type of student loan (private or federal), as well as balance, payment history, payment due and more to help lenders identify impacted consumers.
- TruVision Trended Usage Algorithms — This series of algorithms indicates if the consumer is making the minimum payment (or payments in excess of or less than the minimum) to understand shifts in payment behaviors for student loans and other credit products, even if delinquencies are not reported.
- TruVision Trended Liquidity Algorithms — This set of algorithms tracks changes in consumers’ liquidities over 3, 6 and 12 months to help lenders differentiate risk levels based shifts that may result from additional debt burden when federal student loan payments resume.
Learn more about these and other TruVision™ offerings.
1 FACT SHEET: President Biden Announces New Actions to Provide Debt Relief and Support for Student Loan Borrowers, June 2023