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Loans Held for Sale
 6 Months Ended
Jun. 30, 2026
Transfers and Servicing [Abstract]  
Loans Held for Sale Loans Held for Investment
Loans held for investment consist solely of Private Education Loans as of June 30, 2026. We use “Private Education Loans” to mean education loans to students or their families that are not made, insured, or guaranteed by any state or federal government.
Our Private Education Loans are made largely to bridge the gap between the cost of higher education and the amount funded through financial aid, government loans, and customers’ resources. Private Education Loans bear the full credit risk of the customer. We manage this risk through risk-performance underwriting strategies and qualified cosigners. Private Education Loans may be fixed-rate or may carry a variable interest rate indexed to the Secured Overnight Financing Rate (“SOFR”). As of both June 30, 2026 and December 31, 2025, 22 percent of all our Private Education Loans were indexed to SOFR. We provide incentives for customers to include a cosigner on the loan, and the vast majority of Private Education Loans in our portfolio are cosigned. We also encourage customers to make payments while in school.
The following table summarizes our Private Education Loan sales to unaffiliated third parties for the periods presented. We did not sell any Private Education Loans in the three months ended June 30, 2025.
Three Months Ended June 30,Six Months Ended June 30,

(Dollars in millions)		202620262025
Loan principal$399 $3,530 $1,840 
Capitalized interest
21 222 163 
Total Private Education Loans sold$420 $3,752 $2,003 
Gain on sale of loans, net
$15 $161 $188 
There were VIEs created in the execution of certain of these loan sales; however, based on our consolidation analysis, we are not the primary beneficiary of those VIEs. These transactions qualified for sale treatment and removed the balance of the loans from our balance sheet on the respective settlement dates. We remained the servicer of these loans pursuant to applicable servicing agreements executed in connection with the sales. For additional information, see Note 8, “Borrowings - Unconsolidated Funding Vehicles” in this Form 10-Q.
Certain of these loans sales were a component of a larger transaction that included fees paid to us as a decision maker or service provider. Based on our analysis, we determined that the fees are not variable interests in VIEs. For additional information, see Note 2, “Significant Accounting Policies — Variable Interest Entities (“VIEs”)” in our 2025 Form 10-K for additional information.
Loans held for investment are summarized as follows:
June 30,December 31,
(Dollars in thousands)20262025
Loans Held for Investment, net:
Fixed-rate$16,205,940 $16,952,620 
Variable-rate4,585,557 4,707,814 
Total Private Education Loans, gross20,791,497 21,660,434 
Deferred origination costs and unamortized premium/(discount)94,010 102,008 
Allowance for credit losses(1,354,014)(1,430,318)
Loans held for investment, net$19,531,493 $20,332,124 
The estimated weighted average life of education loans in our portfolio was approximately 5.7 years at both June 30, 2026 and December 31, 2025.
The average balance (net of unamortized premium/(discount)) and the respective weighted average interest rates of loans held for investment in our portfolio are summarized as follows:

20262025
Three Months Ended June 30,
(dollars in thousands)
Average BalanceWeighted Average Interest RateAverage BalanceWeighted Average Interest Rate
Private Education Loans$21,119,086 10.25 %$22,561,636 10.62 %
Total portfolio$21,119,086 $22,561,636 


20262025
Six Months Ended June 30,
(dollars in thousands)
Average BalanceWeighted Average Interest RateAverage BalanceWeighted Average Interest Rate
Private Education Loans$22,226,216 10.36 %$22,738,295 10.61 %
Total portfolio$22,226,216 $22,738,295 



See Note 5, “Loans Held for Investment — Certain Collection Tools — Private Education Loans” in our 2025 Form 10-K for additional information.
Loans Held for SaleWe had $172 million and $933 million of loans held for sale as of June 30, 2026 and December 31, 2025, respectively. At June 30, 2026, we reversed $2 million through the provisions for credit losses related to these loans, when the loans were transferred from held for investment to held for sale. On July 22, 2026, we sold approximately $175 million of our Private Education Loans, including $172 million of principal, $3 million in capitalized interest, and $0.2 million in accrued interest to the strategic partner. See Note 16, “Subsequent Events” in this Form 10-Q for additional information.