ReliaMax expanding their headquarters in Sioux Falls, South Dakota.

The student loan market has changed a great deal over the past decade. While private student loans contributed between $5 and $7 billion in new loans annually just seven years ago, it now contributes $10 billion per year as well as a portfolio numbering more than $100 billion in outstanding loans.

With that in mind, student loan lenders are looking to more accurately assess and price private student loans. And ReliaMax has announced that its subsidiary, ReliaMax Surety Company, has launched two new initiatives that will give all lenders more accuracy and flexibility in insurance pricing and payments for student loans.

The first offering is ReliaMax Risk Grades which is a scoring system that uses traditional credit scoring criteria with additional dimensions. It allows lenders to more accurately identify risk and price private student loan insurance. This initiative could potentially benefit borrowers since lenders will be able to offer a variety of loan options that include fixed and variable rate pricing; international, medical, or MBA degrees; professional education, and more.

And Basis Points Pricing is a monthly option for paying insurance premiums during the course of the loan instead of all up front, which will enable lenders to better manage their loan portfolios and improve cash flow.

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ReliaMax’s CEO said that the goal of both initiatives is to bring additional lenders into the market so that more students will be able to finance their education. After all, the average cost for college is rising. Many students are barred from both private or public options unless they are able to secure a loan; thus, student debt is rising along with the cost of college, amounting to $1.4 trillion in the United States.

The initiative from ReliMax should be helpful to students by helping lenders provide accurate information for and estimated costs of private student loan. This is especially important considering that most students don't know what their student loan payment will be after graduation; in fact, a report from The Student Loan Report found that 36 percent of students graduating in 2017 couldn't quote their expected student loan payment within $20. With this in mind, ReliaMax's new system becomes even more important since private student debt often comes with higher interest rates than federal options, leaving less room for error.

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