An Income Share Agreement (ISA) is funding for higher education in exchange for a percentage of your income if and once you land a decent job.
ISAs are becoming increasingly common. For some, they’re a no-brainer. An ISA, for example, could help fill in the gaps for financial aid if you’ve reached federal borrowing limits or are attending a school that’s ineligible for federal or traditional private student loans. They are also ideal for students looking to upskill using a Bootcamp or specialty school where they might not have a traditional means of funding.
In some cases, ISAs are available directly from your school, who partner with companies, such as Meratas, to administer and organize the ISA. But in other cases, it may be more difficult for you to find an Income Share Agreement if your school does not directly offer one. If you’re interested in comparing your options, here are different ways to secure funding for your degree through an ISA.
Schools That Offer Income Share Agreements
All sorts of schools are joining the ISA game, including traditional 4-year colleges and universities, online-only educational institutions, and a variety of bootcamps and career training programs. Although this isn’t an exhaustive list, this will highlight some key ISA programs offered across the U.S.
Through its Back a Boiler – ISA Fund, Indiana’s Purdue University offers ISAs as a supplement – not a replacement – for traditional private student loans. Eligibility is limited to non-freshman students who have exhausted their federal loans for the academic year and are considering traditional private student loans or asking their parents to borrow a Parent PLUS Loan. To qualify, students must have no significant negative incidents, such as wage garnishment or bankruptcy, listed on their credit report.
Nearly 800 students have received $9.5 million in funding through the program, according to the school. It caps each student’s repayment at two and a half times what they initially received. You could use the school’s ISA comparison tool to estimate your dues.
Lackawanna College, a private institution in Pennsylvania, reserves its ISA for covering remaining tuition costs after borrowing federal student loans. The program is available to students who sport at least a 2.5-grade point average and are pursuing select majors.
Lackawanna’s alumni who take part in an ISA enjoy a federal loan-like, six-month grace period before they start paying an agreed-upon percentage of their income for the following five years or so. At the end of those years, the participant no longer owes anything, even if they haven’t repaid as much as they originally received.
Clarkson University’s donor-funded ISA program is competitive, available to only 20 students per year. The private upstate New York university disburses up to $10,000 per student per school year. Members of the 2018 class who receive a four-year ISA, for example, would get $40,000 and then repay 6.2% of their income for 10 years.
About 97% of Clarkson graduates find work in their fields after graduation, according to the school.
Messiah College, a private Christian school in central Pennsylvania, started its pilot ISA program in June 2018 for undergraduates. Messiah offers $5,000 per year and the payment cap is 1.6x the ISA amount that students take out. Messiah students in an ISA would be expected to repay 3-3.5% of their income for 84 months once their earnings surpass $25,000 annually.
In the pilot phase of its ISA, the University of Utah’s Invest in U program is limited to undergraduates who are within one year of collecting their diploma and are pursuing one of 18 majors. After accounting for gift aid like grants from your state and scholarships, these students could receive between $6,000-$20,000 per academic year.
Depending on each student’s major and the amount received, they could expect to repay 2.85% of their employer’s paycheck for between 3-10.5 years. However, they can defer their income payments while they earn less than $20,000 or attend graduate school. Check out the university’s ISA comparison tool to measure its usefulness for your situation.
Officials at Colorado Mountain College had a specific goal in mind when the school launched its ISA program in 2018: help undocumented students pay for college. CMC’s tuition per year is $2,400, so their ISA program offers $3,000 per year.
Depending on each student’s situation, they could expect to repay 4% for 60 months once they are earning $30,000 (or sooner if a student pays back the total amount of the funds they received before 60 months), and the great thing about this ISA is that students don’t pay more than the amount of ISA that they take out.
Norwich University in Vermont became the only military college of its kind to provide an ISA option to its sophomores, juniors, and seniors, rolling out the program in the fall of 2018.
You’d have to be comfortable giving back some of your salary to attend Norwich. By 2019, 48% of the graduating class of 2017 was employed – 38% of whom worked in the military, according to the school.
Northeastern University is a private research university located in Boston Massachusetts. They offer both undergraduate and graduate-level programs. Northeastern’s students distinguish themselves as some of the nation’s top creative thinkers, intrepid entrepreneurs, and motivated researchers.
Northeastern understands that each student’s and family’s financial circumstances are unique and offer a number of payment and financing options including Income Share Agreements. The funds through their ISA program are typically provided per term in alignment with the billing cycle, academic year, and terms of enrollment. Exact disbursement dates are determined by your ISA provider. Check out Northeastern’s ISA terms here.
Lambda School has built a curriculum designed to get you hired. They asked hundreds of top tech companies what specific skills they look for in candidates and then designed their lives and remote programs to include learning activities that help you master each key skill.
With Lambda’s ISA, they cover all of your $30,000 tuition in exchange for 17% of your income for 24 months, but you only start making monthly payments once you’re earning $50,000.
For some entering the computer science field, ISAs can prove useful. Many coding bootcamps and schools aren’t eligible for federal student aid in the first place, so ISAs are a way to fill the void of funding.
That’s the case at Make School, which claims to be the first start-up-style school to offer bachelor’s degrees in applied computer science. Here, you could finance your education with either a partial ISA (worth $35,000) or full ISA ($70,000): With a partial ISA, you repay 20% of your gross salary for 30 months. With a full ISA, you repay 20% of your gross salary for 60 months.
The school also offers a $1,500-per-month ISA for living costs that would be repaid from 5 to 7% of your income over 10 years.
Redwood Code Academy
Redwood Code Academy offers software development bootcamps for either 12 or 24 months in either New York, San Francisco, or online. Redwood Code Academy covers full-stack software development, with a focus on web applications, but also includes mobile applications, desktop applications, and cloud services. The Academy focuses on real-world skills training by helping students learn the fundamentals of full-stack development.
Redwood Code Academy also provides students with career guidance including resume prep, optimization of LinkedIn and Github profiles, mock job interviews, and introductions to local recruiters and employers in Redwood’s hiring network. Redwood is powered through Meratas to offer an ISA to their students. Check it out here!
This bootcamp offers full-time and part-time Full stack development, front end web development, digital marketing, and UX/UI design programs in Miami, Florida. The program is 10 weeks full time and 12 weeks part time.
Wyncode’s Income Share Agreement program allows three candidates in every cohort to enroll in a full-time Wyncode program with no up-front tuition costs. Wyncode’s Income Share Agreements are granted to candidates that have a financial need. ISA recipients can pay back tuition once you’ve landed a job making $40,000/year or more. ISA applications are open for our full-time programs: Full Stack Web Development and UX/UI Immersive.
Insight Data Fellows
Insight is a seven-week professional training fellowship and data science program designed to be your bridge to a thriving career. Applicants should have a background in Physics & Astrophysics, Mathematics & Statistics, Neuroscience & Bioinformatics, or Engineering & Computer Science, as well as their PhD. Students are mentored by employees of top tech companies, who then hire graduates as data scientists and engineers. Insight’s ISA is designed to lower the barrier of entry to making career transitions, allowing Fellows to join the program without requiring any upfront payments. You can find an example agreement here.
Holberton School is a two-year software engineering school that trains individuals to become Full Stack Software Engineers with courses in full stack web development, machine learning, augmented and virtual reality, and algorithms. The school’s mission is to train the next generation of software developers through 100% hands-on learning. The bootcamp is broken into three different components. Students complete the 9-month Foundations school then a 6-month internship followed by a 9-month Specializations course. Their curriculum focuses on collaborative, project-based learning with no formal classrooms or teachers. Holberton’s students have been hired by the world’s leading tech companies. They also offer their students Income Share Agreements to fund their education.
Companies That Offer Income Share Agreements
A company that offers ISAs means that any student can apply with them and use those funds for any school, regardless of whether that school offers an ISA. You would apply with the company for a certain ISA, they would then disburse those funds to you, and then you could use those funds for your school or program. For now, only a few private companies provide ISAs directly to students – Blair, Lumni, and Align are among them – although more are expected to join. Edly and Tradeup also provide direct to consumer ISAs.
As you review these ISA providers, compare terms such as income threshold and repayment cap, just as you’d judge traditional private student loans by their interest rate and repayment term. By looking at the income share terms, you can help ensure you land an ISA with the company that best fits your needs.
What if My School Doesn’t Offer an ISA?
That’s where Meratas comes in.
Meratas provides a full-service SaaS Platform for Schools and Skills-Training Courses to design, administer, and service custom ISA programs. We help institutions create impactful ISA programs designed to promote student accessibility and increase enrollment.
Our programs are intended to incentivize students, schools, and capital providers to work together to promote and finance only the best educational programs that lead to more successful careers.
If you’re interested in offering an ISA option at your school or program that has been proven to increase student enrollment, there’s no better time to offer one then now! Click here to schedule a call with one of our ISA specialists and get your ISA program up and running today.
Are you a student and don’t have an ISA option at your school? Want one? Let us know here so one of our ISA specialists can reach out to your school!
Ensure an ISA is a long-term plan for your degree
If you like the idea of an ISA – as a way of borrowing less traditional private student loans – check in with the schools above. Although this list is not extensive, if none of these schools line up with your plans, check out our student’s page for a list of even more schools. (Please note these ISA statistics are as of August 2020 and are subject to change in the future.)
Before you decide, however, note that not all jobs or training paths are the correct ones for an ISA – take a look at our suggestions for some fields that are a better fit for this type of funding.
If an ISA sounds intriguing, take a look at some of the pros and cons. Interested in more ISA programs? Check out our student’s page for a full list of schools and programs offering an ISA through Meratas!