In recent news, CommonBond has announced the completion of a hefty securitization of student loans which is the second successful transaction in the past year. The student loan consolidation lender sold $150 million in student loan assets to Goldman Sachs and Barclays. The previous year in June saw a $100 million transaction in securities; in all, CommonBond has securitized $250 million in student loan assets.
The two involved banks, Barclays and Goldman Sachs, co-led the securitization transaction with CommonBond. The final recipients of these securities were banks, asset managers, credit funds, and other insurance companies. The deal has received plenty of positive press; for instance, one of the world’s leading credit rating agencies, DBRS, rated the transaction highly.
CommonBond has continued to make moves which is evident from its funding announcement in January of 2016. A grand total of $625 million has been raised through debt financing and equity. This puts CommonBond on track to breach over a billion dollars in loans before the end of 2016.
The tech-enabled lender has proven its success with a 0% borrower default rate; additionally, CommonBond saves its users approximately $15,000 on refinanced student loans. It is not much of a surprise that the refinancing company is on track to surpass $1 billion in loans.
At any rate, there seems to be a movement in business towards online tech-oriented lending companies when it comes to student loans and refinancing. These companies offer transparency and better customer service to its borrowers; a trend that is growing in necessity.