Goal Structured Solutions, Inc. (GS2) has partnered with Make School in an Income Share Agreement (ISA) collaboration that will make GS2 the first lender to improve a school’s cash flow opportunities by utilizing the cutting-edge repayment method. The partnership was announced through a press release published by GS2 on July 24.
GS2 closed a $2 million credit facility in order to fund Make School’s curriculum, facilities, and faculty, enabling Make School students to fund their education without incurring any debt through ISAs. While students can attend the school debt-free, their projected incomes will be expected to make GS2’s investment a worthy one.
Income Share Agreements have become a popular news topic in recent times because it is an entirely new way to pay for education without incurring massive amounts of student debt. ISAs will assist students in paying for college by assigning a fixed percentage of their post-graduation income that will be used to pay off their education. The student will make these income-based repayments to the school for an agreed upon number of years after leaving the college or university. During their time at higher education institution, the student will accrue no interest.
Essentially, the college or university is betting that the student will receive a good enough education so that they can land a high paying job that will enable them to pay back the institution. One believed benefit of ISAs is that they will create transparency by aligning the cost of an education with the students’ outcomes.
“Traditional methods of financing higher education only evaluate families’ ability to pay based on past performance without transparency to a student’s potential return on investment for their education. ISAs align costs to outcomes and broaden consumer information, leading to more informed decisions and improving accountability,” said Ken Ruggiero, Chairman and CEO of GS2.
Goal Structured Solutions, Inc. is both an administrator and developer of student loan programs, including such programs conducted by unaffiliated parties. GS2 currently handles over $26 billion in private and federally-backed student loans for its partners and clients. Additionally, GS2 has spent over $140 million to buy over $3.1 billion in both performing and nonperforming student loan portfolios.
Make School is a different type of higher education institution. The school focuses on computer science education and puts a strong emphasis on project-based learning. Make School has a Product College and a Summer Academy, where students work on projects they have a passion for and build professional relationships with tech-industry professionals. Make School is based in San Francisco and has campuses throughout the U.S. and Asia.
Author: Andrew Rombach
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