Private student loans are an established form of consumer borrowing utilized in the $325+ billion higher education funding market. Private student loans are used to cover qualified education costs including tuition, room and board, books and other school related expenses.

Over the past decade, millions of American students and families have turned to private loans as the cost of higher education continues to outpace increases in federal student loan program limits. Private student loans offer students and families a resource to help bridge the growing funding gap that exists between the actual cost of higher education and federal aid, grants and scholarships available.

Escalating tuition costs with nominal increases in federal financial aid have resulted in increased demand for education financing. About $10 Billion in private student loans were originated during the 2009-2010 Academic year.

The private student loan market is positioned to provide financing for higher education for the many American families facing a wide range of economic pressures

While demand for private student loans continues to grow commensurate with increased costs, the availability of private student loans has dramatically decreased due to upheaval in the credit markets. Many traditional providers of private student loans have exited the market or curtailed origination, even while loan demand still exists. Huge opportunities exist for financial institutions to fill the void.

Learn More: Why the Private Student Loan Industry is Attractive?