Right now student loan debt and a lack of savings by student loan borrowers are two of the most pressing financial issues in America. In fact, nearly 70% of Americans have less than $1000 saved. When we set out to create the Defynance Income Share Agreement (ISA) platform, we wanted to tackle both of these looming issues. Our team believes that we have come up with a solution that tackles both. We don't want to just free people from the burden of debt, we also want to increase financial wellness and build a culture of saving and investing. This is why we incorporated an ISA Self Equity Account for everyone who refinances their student loans with our ISA refinancing platform.
The Defynance ISA Self Equity Account
We've basically gone full Xzibit on this one by flipping what paying back student loans is like. We went even further by adding a savings option into our ISA. When someone refinances their student loan to a Defynance ISA, they will also own a small share of their ISA and get cash back when it ends. In other words, our ISA refinancers show that they believe in themselves by putting their money where their mouth is.
How it works
Whenever anyone signs up for a Defynance ISA, they will have to buy into at least 5% of their own ISA. They can do this by paying the 5% up front or by putting their first few payments towards it. If they use the first few months to build equity, the actual ISA term will start after their self-equity reaches at least 5%. If they put in more, they will earn more by the end.
During the ISA term, the ISA refinancer will get a share of each payment equal to the percent of the ISA they own. The payment will be set aside in their ISA self equity account, which grows with each payment. When the ISA term ends, the proceeds in the Self Equity Account will be given back to the ISA refinancer. If the ISA refinancer defaults on their ISA, they will lose all the money in the account.
Why it's a good thing
Everyone enjoys earning money and this feature allows our ISA refinancers to actually get cash back once the ISA is completed. To be clear, this feature does not change or increase the income share percentage, it just gives everyone a way to get cash back in the end. We believe the Self Equity Account option will demonstrate the values of responsibility, savings, and believing in oneself. It is the type of financial freedom that we seek to empower with Defynance.
To learn more about Defynance and their ISA program click here. Or click here to apply for an ISA.
