Since the age of 15 I've wanted to go to the School of Visual Arts. I had my eyes fixed on the Designer as Author & Entrepreneur program since I was 22, and planned to apply every year since I was 25. But every year would come and go, and I would chicken out.
I saw it as an investment in my professional future, but I was already feeling limited on account of my student loans, and the prospect of worsening that debt petrified me. I came to understand that going to grad school meant I would have to make some pretty severe sacrifices in other areas of my life: owning a home, having children, living in New York. The morning I received my acceptance letter, so many doors seemed to burst open, but so many others slammed shut.
This was a profound moment for me, but it's not a unique problem – Stateside or otherwise. Every day we hear more and more about the student debt crisis in the news, and whether the number of those indebted here in the US is presented as 39 million or 40, or the collective debt is charged at $1.1 trillion or $1.3, the fact remains: it's big, it's bad, and people are starting to take note. As the debate rages on about what should be done, grads continue putting more money toward their pasts than they can put toward their futures.
In researching options for easing the burden of my own student debt, I found that there really aren't any. Because unlike other forms of debt, student loans are not eligible for refinancing at any point. No matter how strong your credit score grows, that 7 or 8 per cent you got for your grad loan has no chance of ever going down. And despite a few soundbites from the campaign trail, there hasn't been much movement by the government on this issue.
But having the chance to knock a point (or two or three) off your interest rate could determine when you are able to buy a home, start a family, or afford to take a risk in your career. It's a tiny adjustment with the potential for tremendous impact, both on the individual and on the economy.
In developing my thesis, I aimed to create a space where grads looking to refinance could connect with investors looking to help. With Shared Interest a grad who satisfies certain credit criteria can set up a profile, including such details as where they went to school, what they studied, goals they have for their life, as well as a proposal for the terms of a new loan.
Individual investors use filters and keywords to find grads that best fit their interests and can offer microloans to grads they've selected. Once fully funded, the money is sent to the original loan servicer to pay down the higher interest debt. The grad then makes monthly payments to their peer investors at the lower rate, paying off their debt faster.
Shared Interest sets burdened grads free. We may not be able to tackle the big, bad crisis overnight, but we can at least help to reopen some of those doors – and all be served in doing so.
Words: Chiara Bajardi Illustration: Zaneta Antosik
Chiara Bajardi is a New York-based designer and recent graduate of the MFA Design program at the School of Visual Arts. She is founder of Shared Interest, a peer-to- peer lending platform for refinancing student loan debt. This article originally appeared in Computer Arts issue 230.