For Students

What is the Flywheel Fund for Career Choice Fellowship Program?

Flywheel’s Fellowship Program was built by Stanford and Harvard Law School alumni seeking to empower law students to pursue diverse and high-impact careers by alleviating the burden of traditional installment education loan debt. Fellows gain access to the Flywheel Income Share Loan (FISL), made available through the Clasp Platform¹. The FISL is a funding agreement where Fellows, if approved, receive $56,666.67 per academic year (up to $170,000.00 over three years² to support tuition/fess in exchange for a commitment to pay between 0.33% to 3.33% of their income for 12 years following graduation or separation from the program). The Fellowship program is available to qualified 1L, 2L and 3L JD candidates enrolled in Stanford Law School.³

Students accepted into the Fellowship program will be able to borrow up to $56,666.67 per academic year (up to $170,000.00 degree total over three years to cover tuition and fees as they complete their Juris Doctorate at Stanford Law School. After graduation or separation, and upon employment, payments of 0.33% to 3.33% of gross income over 144 months.² Fellows who each less than $100,000.00 per year will have ALL payments due under the FISL, paid by Stanford Law School (“SLS”), and Fellows earning between $100,001.00 and $115,00.00 will have a portion of their payments subsidized by SLS.²^,³

What benefits does this program offer to students?

The FISL² provides a new and more flexible way for students to pay for their Stanford Law School education. As part of the program, when Fellows make more, they pay more, and if Fellows make less, they pay less (or nothing). Stanford has agreed to contribute ALL required payments for any Fellow who earns will less than $100k annualized in any given month and to subsidize a portion of the payments due from Fellows who earn between $100,000 and $115,000 annualized.³ 

The percentage of the income Fellows pay stays the same, but monthly payments may go up or down depending on salary. If Fellows earn a high income, a total payment cap will limit how much they are required to pay. If your monthly gross income exceeds $25,000, your payment will be calculated using a Qualified Monthly Gross Income of $21,666.66.

*Who is eligible to apply for an ISL?

The Flywheel Fund FISL² is available to:

1. First (1L), Second (2L) and Third (3L) students at Stanford Law School.
2. Students with U.S. citizenship or permanent residency.
3. Students 18 or older at the time of the contract execution.
4. Students who have submitted their FAFSA for the current school year.
5. Students who are a resident of a state/US territory where the loan product is offered.
6. Students who complete the FISL application and credit check.
7. Students who meet the credit criteria of the Lender.

What is the application and approval process for a FISL?

Interested students can fill out the interest form linked here. The interest form is a simple online form that takes less than 5 minutes to complete. Students should have the following information available in order to finish their applications as quickly as possible:

1. Your first and last name.
2. Your Stanford email address.
3. Your year in school.

After students submit the interest form, their information will be verified and students will be sent application directions. Once a candidate successfully completes this application, the Flywheel board will review submissions and will select finalists. Selection as a Flywheel Fellow is not guaranteed and is not determined by FinWise bank or Clasp.² If selected as a finalist, you’ll complete a FISL² credit application as your final step. The entire process from start to finish takes no more than two weeks.

When do participants start making payments?

After graduation, Fellows have a payment-free grace period of 6 months. 

If Fellows don’t secure employment before their grace period expires, they must reach out to clasp.launchservicing.com or call 1-833-514-1834, to request deferment. Fellows will not be personally liable for any payments in months where their monthly gross earned income is below the Minimum Income Threshold. Stanford Law School LRAP will fully subsidize all payments due for any employed Fellow earning below
$8,333.33 per month ($100,000.00/year).

When does the FISL end?

The Flywheel Income Share Loan (FISL)² will end when one of the following occurs — whichever comes first:

1. You and Stanford collectively make 144 payments.³
2. The maximum repayment period of 216 months inclusive of any months where monthly payments are made as well as any months that are deferred months after you enter repayment expires.³
3. You reach the Maximum Payment Cap of $104,000.00 or the Maximum Implied Annual Percentage Rate (APR) of 8.94%.
4. You make payments equal to the Multiple Payment Cap 1.84X of the funded tuition. The Payment cap is $260,000.00/year.²

What is the difference between a traditional installment loan and FISL?

Unlike traditional installment loans, the FISL² is designed to align repayment with Fellows’ ability to afford payments based on career outcomes.

Traditional installment loans for education generally include :

1. Fixed payment that do not account for your earnings
2. Payment schedules that may require payments even if you are unemployed
3. May require co-signer or high current income for students

FISL for Flywheel Fellows provide:

1. That payments are tied to income, giving you confidence that payments remain affordable, no matter your earnings
2. That SLS will fully subsidize any payments you may be required to make during months where you make less than $100,000/year
3. A cap on the Monthly Payments you can be required to make – limited to the first $21,666.66 of Monthly Earned Income you receive (equivalent of $260,000 annualized)³
4. 12 year payment term (up to a maximum of 18 years) for a the FISL Program³

What income is included in the determination of individual vs family income? In the determination of assets vs income?

This program will only use personal income, not family income, when assessing the value of each monthly payment for the FISL². This is calculated for U.S. taxpayers this includes Line 1 (Wages, salaries, tips) of IRS Form 1040EZ OR the sum of the following lines from IRS Form 1040:

1. Line 1 (Wages, salaries, tips, etc.)
2. Line 8 (Business income or loss), and
3. Line 13 (Other income)

Earned Income also includes:

1. Non-cash consideration received by you or deemed earned by you, directly or indirectly, such as contributions made to a deferred or equity compensation plan on your behalf
2. Income and distributions received by you from your participation in any entity
3. Equity rights or deferred compensation received during the Payment Term
4. Any amounts earned by or payable to you, directly or indirectly, as a result of your provision of services to a related party

What is the tax treatment for recipients of SLS support? for those not receiving SLS contributions?

Students who receive funds from SLS through the LRAP program may be liable for taxes on payments made on their behalf. Please review Stanfords LRAP materials and tax documents. Students who do not receive money from the Stanford LRAP program throughout the life of their contract should not have any additional tax liabilities, unless the full amount taken is not repaid.

How is the status of employment determined? How is income verified?

Fellows are required to submit income related documents prior to the initiation of their first payment (6 months after graduation). If Fellows are unemployed they will need to reach out via clasp.launchservicing.com or call 1-833-514-1834.

What are the consequences of non-payment of amounts due under the FISL?

Students who fail to make payments towards their FISL, including amounts contributed by SLS, may be liable for negatively credit reported, default on their Loan and submitted to collections.

Are there provisions for early repayment?

Students who would like to repay early will need to pay up to the “Early Termination Amount” outlined in the FISL contract.

Is there a “tolling period” where payments are not due if a Fellow accepts a clerkships, seeks unemployment, or pursues additional education, etc.?

1. If Fellows are earning below the Minimum Income Threshold, (e.g. during their Clerkship) or other employment, then Stanford Law School (“SLS”) will make payments on the Fellows’ behalf.  Fellows’ will need to provide income documentation.
2. Fellows who are unemployed must communicate that information to clasp.launchservicing.com or call 1-833-514-1834 and will need to provide documentation proving their unemployment status and documentation showing they are actively searching for employment.
3. Fellows who pursue additional education may be eligible for deferment if they have no earned income while in school. Fellows who have any earned income while in school will still be be required to make monthly payments, however if Fellows earn less than $100k Stanford will make payments on their behalf through the LRAP program.³

What happens to my ISL in the event of a personal bankruptcy?

We may seek the payment of any amounts that were due and unpaid as of the date of your bankruptcy filing. Flywheel will not enforce its rights under the United States Bankruptcy Code for potential future payments and shall at no time assert that this Agreement is non-dischargeable as a qualified student loan as set forth in 11 U.S.C. § 523(a)(8) or such other law that may, in the future, limit the dischargeability of income share agreements where such limitation on dischargeability is based upon the use of the income share agreement for educational expenses.

What happens if I have a change in family status during my ISL repayment? (ex. marriage/divorce/children)

This has no effect on the FISL as repayment is only tied to personal income. However, a change in family status may impact the amount that Stanford’s LRAP pays on your behalf if you earn between $100-115k during the Payment Term³. For more information, check out the LRAP calculator here.

What happens if I have an emergency financial need? (ex. family illness/disability)

Under certain circumstances, in our sole discretion, we may grant you a forbearance. You may upon approval take up to a total of six (6) months of forbearance, though a forbearance period cannot be longer than three (3) continuous months at one time. During a forbearance, you will not be required to make Monthly Payments. Months you are in forbearance will extend your Payment Term on a one-for-one basis.

What is Flywheel’s selection criteria and process?

Selection as a Flywheel Fellow is not guaranteed and is not determined by FinWise Bank or Clasp.² Fellows will be selected by the Flywheel Fund leadership in line with the stated mission-driven and research goals detailed at flywheelfund.org. Applicants must meet the credit criteria established by the Lender.

How are my payments calculated during periods of uneven income? (ex. six months employed, six months unemployed, annual bonus, etc.)

If a student becomes unemployed they must communicate with and provide documentation to clasp.launchservicing.com or call 1-833-514-1834, within 30 days.

How does a FISL interact with other debt instruments?

Fellows’ total obligations under all income-based agreements should not require you to pay an aggregate income share exceeding 20% percent of your earned income in any given month. Loans with income-driven repayment plans, including federal student loans, will not be considered private income-based agreements.

Where can I send additional questions or who can I reach out to?

1. If you have any additional questions regarding the Fellowship, please reach out to us at info@flywheel.org
2. If you have any questions related to the FISL application, please reach out to Clasp by calling (214) 775-9960 or via email at support@clasp.com

How are stock grants, stock options or other forms of equity treated under the FISL calculations of income?

“Earned Income” means your total wages, compensation and gross income from self-employment reported or required to be reported on an income tax return. On an annual basis, for U.S. taxpayers, this includes: (a) the sum of Line 1 (Wages, salaries, tips, etc.), Line 8 (Other Income), and Line 13 (Qualified business income) of IRS Form 1040; or (b) Line 1 (Wages, salaries, tips) of IRS Form 1040EZ, as reported or required to be reported on U.S. federal income tax returns. Earned Income also includes any non-cash consideration received or deemed earned by you, directly or indirectly, including, but not limited to, contributions to qualified and non-qualified deferred and/or equity compensation plans, income and distributions from your active participation in any entity, and equity rights or deferred compensation generated or attributable to the current period of your employment. If you file tax returns jointly with your spouse, your Earned Income shall not include any income earned solely by your spouse, as demonstrated by you to Flywheel’s satisfaction.

For any non-U.S. taxpayers, Earned Income shall substantively mean the equivalent of the amount that would be calculated based on this definition if the taxpayer were a U.S. filer. 

At its discretion, Flywheel may estimate your Earned Income using documentation or sources other than your U.S. federal income tax return, provided that the documentation is another verifiable source acceptable to Flywheel. Flywheel will specifically be permitted to, amongst other sources, use third party income verification and employment verification services to estimate your Earned Income.