WHAT IS AN ISA?

An Income Share Agreement (ISA) is a financial product where, after receiving funds to help cover your education, you agree to make a fixed number of income-determined monthly payments after school in months where you are earning above a minimum amount.

BFF has designed its Income Share Agreement  to challenge aspects of private loans that they feel hurt students.

  • BFF believes your payments should adjust if your income changes.

  • BFF believes that if you're making consistent payments towards your ISA, you shouldn't have bad outcomes.

  • BFF believes that you shouldn't have to worry about paying if you are unable to or cannot find work.

  • BFF believes its community funds should be sustained when students graduate and do well financially.

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PERCENTAGE OF INCOME

BFF's ISA is designed so that the amount you pay every month is aligned to your after-college income.

When you need funding for college, BFF provides the money to you or directly to your school, on your behalf. This amount is your funding amount. 

The percentage of your income is based on your funding amount, with higher amounts requiring a higher income percentage. It won't change over the lifetime of your ISA.

 
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Payment Period

BFF offers 20-year ISA contracts. This means you are obligated to make income-based payments for 20 years—or until you reach the maximum payment cap.

 
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Lower Income Cut-Off

Whenever you're making below the lower income cut-off, your income-determined payments are $0 a month. This is meant to protect students who have a hard time finding a well-paying job or lose their job at any point.

 
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Upper Income Cut-Off

Whenever you're making above the upper income cut-off, your income-determined payments won't continue increasing. This is meant to protect students who do well from overpaying on their ISA.

 
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Early Completion Amount

Your obligation ends if you reach the Early Completion Amount.

BFF wants to make sure you would not have been better off taking out a loan with the same funding amount at a 7.5% interest rate instead of your ISA. To make sure of this, BFF is constantly calculating how far along you'd be in repayment if you had taken out a traditional loan with these terms instead of your ISA (and the loan had the same funding amount, a deferment and grace/transition period identical to your ISA, and where the payments on the loan match any payments you make on the ISA).