JPMorgan Chase, which has been steadily backing out of the classroom over the past few years, said yesterday it would exit student loans on Oct. 12. Since 2010, when Congress allowed Washington to lend directly to students, government loans have grown to dominate the business owning an 80-percent-plus market share. From 2011 to 2012, Uncle Sam wrote 93 percent of the $105 billion student loans originated, according to Consumer Bankers Association. Reflecting that change, Jamie Dimons JPM has seen revenue from student loans fall from $6.9 billion in 2008 to a pedestrian $200 million, according to bank officials. It is not clear how the exit of the countrys No.
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The retail bank has some 64 million customers and 5,657 branches. Last year, Chase visit the website made education loans to 12,500 people for a total of about $200 million. The company’s student loan portfolio at the end of June held $11 billion – less than 0.5 percent – of JPMorgan’s $2.44 trillion of assets. The student loan business is not among those that JPMorgan has publicly said are being probed by government authorities for possibly illegal practices. Those under investigation include mortgage banking, credit card collections, rate-setting for floating-rate business loans and hiring for investment banking in China. The Chase portfolio includes $5 billion of private loans and $6 billion of loans backed by government guarantees that were granted under programs that have been discontinued.
What Happens to Student Loans When You Die?
With traditional loans, as long as the spouse is not listed as a co-signer or joint account holder, he or she is not legally liable for the debt — unless you live in a community property state. If you live in a community property state and your spouse dies , you’re typically liable for your spouse’s debt, regardless of whether your name was on the original loan or not. Community property states include Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington and Wisconsin. Alaska has an optional community property provision for couples who choose to opt into a community property agreement. With student loans, however, the rules are a little different and a spouse’s liability will depend on the type of student loan, whether or not you live in a community property state and your individual state laws. Federal Student Loans If the student loan is a federally backed education loan , a spouse is safe from repayment liability.