A New Chapter in Student Financing
Starting in Fall 2020, Make School will be offering a new financial aid model that will (in most cases) replace the Income Share Agreement we have used since 2014. This new plan is designed to reduce the average cost of a Make School Education while preserving the core protections of ISAs - if you don’t have a job after Make School, you should not have to pay until you are employed.
Under our new model, students will take primary financing from Title IV funding (Pell Grants, Direct Federal Loans, Parent Plus Loans) and private loans. Make School has created a protection plan that will cap your loan payments as a percentage of your income to ensure your monthly loan payments remain affordable. If you are unemployed, this plan will drop your monthly payments to $0.
This strongly incentivizes Make School to see you succeed - if you are underemployed or unemployed after graduating, Make School will be helping pay your loans every month. This new protection plan is called Extended Income Based Repayment (EIBR) and is fully described further down on this page.
ISAs will still be used in rare cases as gap financing - to cover the remainder of tuition and living expenses that a student is unable to fund through federal and private loans. Like the protected loans described above, if you don’t have a job you will not have to pay your ISAs until you are employed.
Tuition Costs, 2020 - 2022
| Fall 2020 | $15,000 |
| Spring 2021 | $15,000 |
| Summer 2021 | $10,000 |
| Fall 2021 | $15,000 |
| Spring 2022 | $15,000 |
| TOTAL | $70,000 |
A full breakdown of the estimated cost of attendance can be found further down on this page.
It is possible for students with no transfer credit to complete the bachelor's degree in 2 calendar years. However, depending on how many credits you transfer in and how many classes you complete in 2 years, you may need to study for a semester or more after your second summer to complete your degree.
Students studying beyond 2 years will incur additional living expenses. These expenses can be covered in part or in full by Federal Direct Loans and Pell Grants, depending on your eligibility. If you need additional support for your living expenses beyond what is available with Federal Direct Loans and Pell Grants, you may need to take out additional private loans or ISA.
Students may have to pay additional tuition for classes beyond their first 2 years of study, though typically students needing 12 units or less to complete their degree after 2 years of study are not charged additional tuition if they have maintained satisfactory academic progress throughout their time at Make School.
How the New Model Works
Based on our learnings over the past 5 years, Make School is shifting to a financial aid model that we believe will be the future of student financial aid. Colleges should be responsible for loan payments that students cannot afford. Income Based Repayment is already a well-established program used by the federal government and all top law schools around the country. We are extending that protection to all loans a student takes out for their Make School education, a system we first recommended in the policy paper we published in December 2019. This extended protection, which we are calling EIBR, effectively brings the best features of ISAs to the established financial aid system used by all colleges. We hope that we can show the way to other undergraduate institutions and spark change across higher education so that no student is left with debt they cannot afford.
Free grant money available for low-income students
At a 4.5% interest rate, available to all students
At 3.7% interest rate, available to all students with excellent credit or a co-signer with excellent credit
At a 7% interest rate, available to all students with parent co-signer without delinquent loan payments
At an 8-15% interest rate, available to all students (except for students who have bad personal credit or significant existing debt)
Don't have an interest rate, but are generally more expensive than private loans due to their variable payback amounts
Our new financial aid model uses an algorithm that advises students to take as much aid from the lowest interest rate source prior to considering higher interest rate sources. This strategy - though it adds complexity - ensures the lowest cost of education for students.
For most students, their full financial aid package will cost less than our existing ISA-based financial aid. For some students, the private loans on their own will be on par or slightly higher than ISAs, but when blended with Pell Grants and Direct Federal loans will generally be more affordable.
In most cases, our students will be protected by our Expanded Income Based Repayment plan which will cap their monthly payments as an affordable % of their income. The only cases that will not be protected by EIBR are those cases where students have no other option but to take ISAs as gap-financing. In those cases, the additional protection is already built into the ISA.
Expanded Income-Based Repayment (EIBR)
Direct Federal Loans come with built-in Income-Based Repayment for students, resulting in payments being capped at 10% of monthly discretionary income. This provides part of the protection for underemployed and unemployed graduates. The problem we are solving is that all other student loans (Parent Plus, Private) don’t come with built-in Income-Based repayment options. So while you could reduce your Direct Federal Loan payments to $0 if you are unemployed, at other colleges you would still have to pay monthly for the rest of your loans. Not so at Make School.
Make School is creating and funding an Extended Income-Based Repayment (EIBR) protection plan to cover Parent Plus and private loans to create full protection coverage for underemployed and unemployed graduates.
The EIBR protection plan is designed as an extension of the Federal IBR program to apply to all types of loans not covered by Federal IBR and preserve the protection and incentive alignment of Income Share Agreements. The EIBR protection plan will cap total student loan payments (combined federal direct, parent plus, and private) to the following percentages of monthly gross income.
| Graduate Annual Gross Income | EIBR Cap |
|---|---|
| $60k+ | 20% |
| $50-59k | 18% |
| $40-49k | 15% |
| $30-39k | 10% |
| $20-29k | 6% |
| <$20k | 0% |
Any debt obligation beyond the cap will be paid out by the EIBR protection plan. The EIBR protection plan is funded by 10% of tuition revenue collected by Make School, placed into a protected fund with transparent financials and independent control. Make School itself is a guarantor for the fund and will top it up if ever necessary.
We expect that around 80% of students will qualify for the cheaper funding options - government and private loans to fund their Make School education. For those who don’t, we still plan on offering ISAs. To receive an ISA, students will be required to apply for these new funding options first*.
*If you have significant existing debt that would result in unaffordable monthly payments after Make School, you may be denied for both loans and ISA. Please contact us immediately at admissions@makeschool.com if you have more than $7500 in outstanding debt. This is not a hard cut-off, just an amount that will trigger a conversation about the best financial options for you.
Example breakdowns for new students (fully on new model)
A student graduating in 2 years will pay $70k in tuition and spend ~$36k in living expenses.
| Pell Grant (free) | $5k |
| Federal Direct Loan (2.75%) | $20k |
| Parent Plus Loan (5.3%) | $82k |
| Total Cost of Education | $106k |
| Blended interest rate | 4.58% |
Median monthly payment (paid for 10 years) |
$1,126 |
| Pell Grant (free) | $8k |
| Federal Direct Loan (2.75%) | $33k |
| Private Loan (13%) | $66k |
| Total Cost of Education | $106k |
| Blended interest rate | 8.95% |
Median monthly payment (paid for 10 years) |
$1,333 |
How the Process Works
EIBR vs. ISA Comparison
Scroll through the table below to see the direct comparison between different financial aid packages (including the Full ISA option offered between 2014-2019).
| Direct Loans + Parent Plus + EIBR |
Direct Loans + Private Loans + EIBR
(payback estimates assume 13% interest rate)
|
Direct Loans + ISA | Old ISA (tuition + living stipend) |
|---|
| Available to | Students with parent cosigner that has moderate credit |
All second year students, first year students with moderate credit or family cosigner
(with exception of students that have very bad credit and no cosigner, and students who have significant existing debt)
|
Students that don’t qualify for Parent Plus or <15% interest private loans
(with exception of students that have very bad credit and no cosigner, and students who have significant existing debt)
|
All students
(with exception of students that have very bad credit and no cosigner, and students who have significant existing debt)
|
Total funding amount
(assumes no cash tuition)
|
~$101k
(will range from $90-115k based on Pell eligibility and time to complete degree)
|
~$99k
(will range from $90-115k based on Pell eligibility and time to complete degree)
|
~$96k
(will range from $90-115k based on Pell eligibility and time to complete degree)
|
$106k |
| Interest rate for loans |
2.75% for direct, 5.3% for Parent Plus
(based on current federal loan interest rates, varies year to year)
|
2.75% for direct, 13% for private loans
(interest and payback will be lower with a cosigner or strong credit)
|
2.75% for direct loans
(based on current federal loan interest rates, varies year to year)
|
N/A |
| ISA Payback Terms | N/A | N/A |
14% for 10 years
(ranges from 14-18% based on Pell eligibility and setup of automatic payments, may extend to 12 years based on time to degree)
|
20% for 5 years for tuition, 5-7% for 10 years for living stipend |
Maximum monthly payment immediately after graduating
(estimated based on typical funding amounts listed above)
|
$1,126 | $1,479 |
$1,716+
(based on $120k starting salary, even higher for starting salaries over $120k)
|
$2,500+
(based on $120k starting salary, even higher for starting salaries over $120k)
|
Maximum percent of gross income owed immediately after graduating
(calculated by adding up all payments owed across federal debt, private loans, ISA)
|
20% of income
(if making exactly $60k, otherwise lower)
|
20% of income
(if making $60k-$85k, otherwise lower)
|
20-24% of income
(dependent on salary, Pell eligibility, and set up of automatic payments)
|
25% of income
(if making $60k+)
|
Average monthly payment post-graduation
(estimated)
|
$886 | $1,076 | $1,048 | $1,440 |
Median monthly payment post-graduation
(estimated)
|
$1,126 | $1,333 | $1,249 | $1,667 |
Median monthly take home pay after taxes and debt payments*
(estimated)
|
$3,513 | $3,306 | $3,390 | $2,972 |
| Length of payments post graduation |
10 years for Parent Plus, 10-20 years for Direct Loans
(depending on federal IBR payback)
|
10 years for Private Loans, 10-20 years for Direct Loans
(depending on federal IBR payback)
|
10-13 years for ISA, 10-20 years for Direct Loans
(depending on ISA deferment and federal IBR payback)
|
5 years for tuition, 10 years for living stipend |
NPV of average tuition payback
(estimated, Net Present Value (NPV) discounts for time value of money)
|
$74k | $92k | $97k | $97k |
Maximum tuition payback
(estimated based on typical funding amount, not NPV adjusted)
|
$135k | $177k | $188k |
$215k+
(even higher for starting salaries over $120k)
|
| Lower payback if paying some cash tuition | Yes | Yes | Yes | Yes |
| Lower payback with co-signer or good credit |
No
(Parent Plus requires parent co-signer. Good credit does not reduce interest.)
|
Yes
(Private loans typically have a 4-11% with a cosigner or with strong credit. They typically have 13-15% interest without a cosigner and little to no credit.)
|
No | No |
| Ability to refinance once employed and credit has been built | Yes | Yes | No | No |
| Ability to pre-pay to reduce interest | Yes | Yes | Yes for Direct Loan portion, No for ISA portion | No |
| Stacks well with future debt (additional education, mortgage) | Yes | Yes | Yes for Direct Loan portion, No for ISA portion | No |
| Tax credit for education loans | Yes | Yes | Yes for Direct Loan portion, No for ISA portion | No |
| Enables students to build credit with reliable payback | Yes | Yes | Yes for Direct Loan portion, No for ISA portion | No |
| Delinquent payments with lack of communication will harm student credit | Yes | Yes | Yes | Yes |
| Dischargeable in bankruptcy | No | No | No | No |
Our Guiding Student Financing Principles
Affordable
Tuition, living and interest expense re-payments must remain affordable relative to income and low enough to allow repayment of tuition within a reasonable time period to enable students to build their lives without significant delay.
Accessible
Students with little to no credit history and no parent co-signer should be able to receive financing. Especially important for students from low-income families. Students with bad personal credit or significant debt may not be eligible.
Economic Mobility
Return-on-investment on the Make School degree must be among top institutions, creating significant upward mobility for graduates.
Downside Protection
Strong downside protection must be in place, whereby unemployed students don’t have payment obligation and underemployed students have reduced payment obligation.
Sustainable
Sufficient funding and tuition revenue must be available to Make School to sustain our cost of operations and improve long term financial health.
Why We’re Shifting Now
We have been working for some time on this shift to a more comprehensive financial aid model. The data we’ve collected on ISAs shows that ISAs can be very expensive for students who graduate earning salaries above $100k, as our alums on average do. Given our growing set of data, the policy paper we published last December recommended our new model for colleges. The new model significantly reduces the average amount that a student will have to pay for their Make School education while maintaining the core protections of an ISA.
We had hoped to finalize our new financial aid model for the class entering Make School in Fall 2021. In light of the extraordinary circumstances brought about by the COVID-19 pandemic, however, we had to accelerate introducing this change by a year. The truth is, the Coronavirus-driven recession has severely impacted ISA funding markets, leaving us without the funding necessary to offer ISAs to all students.
We apologize for rolling this out so late in the academic year, but we feel strongly that this new offering is in our students’ best interest. This program builds on the strengths of the traditional tuition/financial aid model and affords our students the financial protection we have always promised.
Get the Full Walkthrough
From Our Co-Founder, Jeremy Rossmann
Comparing Make School to Traditional Colleges
Our graduates start their careers with an average salary of $100k/year, on par with graduates from top-tier programs and far ahead of the national average of around $66,000 .
Our graduates start working 1-2 years earlier than typical computer science undergrads. This means that while a student at a traditional college would pay up to $40,000-80,000 in tuition for their last years of college, the typical Make School student is already a graduate and will earn $100,000-$200,000 pre-tax during those same years.
2020 - 2022 Academic Year Budget
2019-2021 ACADEMIC YEAR BUDGET
| Live in Preferred Student Housing | Live outside of Preferred Student Housing | Live with Parents | |
|---|---|---|---|
| TUITION* - Year with summer classes | $40,000 | $40,000 | $40,000 |
| TUITION* - Year with summer internship | $30,000 | $30,000 | $30,000 |
| Enrollment Deposit | $250 | $250 | $250 |
| Housing | $11,940** | $21,600*** | $0 |
| Housing (Deposit) | $500 | $1,800*** | $0 |
| Books and Supplies | $200 | $200 | $200 |
| Macbook (only Year 1) | $1,600 | $1,600 | $1,600 |
| Food | $4,200 | $4,200 | $4,200 |
| Health Insurance | $100 | $100 | $100 |
| Transportation | $864 | $1,278 | $1,134 |
| Personal Expenses | $2,853 | $3,996 | $3,564 |
| TOTAL Year with summer classes | $62,507 | $73,424 | $49,448 |
| TOTAL Year with summer internship | $52,907 | $63,424 | $39,448 |
*The total tuition for the 2 year program is $70,000.
**The cost in this table for Make School’s preferred student housing options assumes the student has a triple occupancy room. The preferred student housing costs are as follows:
Single: $1,450
Double: $1,095
Triple: $995
Quad: $975
*** This table assumes a monthly cost of $1,800/ month to live outside of Make School’s preferred student housing options. The cost accounts for rent, utilities, and internet in a shared 2 or 3 bedroom unit. You may be asked to pay the first and last months rent at the time of signing the lease, in addition to a deposit.
