rendon McQueen, the founder of tuition.io aims to help people with college loans get a better sense of how to manage their loan obligations. With more and more students taking our multiple loans to pay for college, tuition.io is a much needed product.Below is an interview with Brendon. Note that at the end of the article, they are giving early access to tuition.io to business insider readers.
How did your team come up with the idea of Tuition.io? Did you experience an issue yourself with student debt /loans?
I graduated from Columbia University in ’09 with 12 student loans and over $120k in debt so I experienced my fair share of issues with student debt. This was at the height of the recession so jobs were sparse and a lot of my friends (including myself) were having trouble paying back their loans. In trying to get my debt organised, I found the experience to be incredibly time consuming and frustrating and heard the same thing from a lot of my peers.
I kicked the idea around for a few months trying to figure out how the heck I was going to make this happen as a first time entrepreneur. You hear a lot about how entrepreneurs are kept up at night problem solving, that was totally me. I think if you can’t stop thinking about your product, it’s a blessing in disguise because your subconscious is not just telling you something, but screaming it from the rooftops. So I took this personal pain and really focused my energy on the step by step logistics of how to tackle something so overwhelming. Late last year we got invited to FGVN which kinda blessed the whole notion of just doing it. The team grew and we found a lot of support from advisors and mentors who could see our passion in the space — which is half the battle.
How big of a problem is managing student loans for people (give me numbers)?
Great Question. The size of the problem for individual borrowers all depends on how many and what kind of loans they hold. That said, a person with one loan that they can’t afford has a big problem of their own. Since 66% of undergrad graduates hold loans and over 50% of grads under 25 are underemployed, it creates a perfect storm of sorts for trouble. For example, something like 38% of student loan borrowers aren’t paying down their loans which either means they’re in some form of forbearance or have flat out defaulted on their loans. To put this in perspective, imagine if 38% of credit card holders just stopped paying their bill. It would be pandemonium. So I think it’s a very big problem for a lot people — and actually, there are currently 37 million borrowers holding about $1 trillion in debt in the US.
Exactly how can people use Tuition.io to save money and make life easier?
We’re really excited about this upcoming product overhaul because it expands our service from a more informational site to something more action driven. Don’t get me wrong, having the information is paramount, but a lot of people hear student loans and stop listening because it’s such a pain point. So we spent a lot of time thinking about how we can really provide a service that provides a real value add for the borrower.
What we’ve come up with is this really amazing personal finance tool for educational debt where a borrower can come, load up all of their loans (both federal and private), see loan specific detail like who their service is, what they owe and what repayment options exist for that loan — and then visualise the whole portfolio with smart, dynamic graphs and a calendar tool for keeping track of their due dates. We’ve also built an expanded algorithm that lets borrowers optimise their loan repayment based on their unique financial situation.
What does that mean for those who stop listening at the very mention of student loans? It means you don’t have to learn all of the terminology or create any of your own spreadsheets, but instead answer a few quick questions, select the option that best suits you and get back to your life knowing that your loans are all set. Remember, we created this tool to solve a problem of our own, so we kept the borrower in mind throughout the development process.
There are a lot of start-ups popping up that claim to help with student debt management, why is your different?
I think you hear a lot about debt consolidators and these cheesy late night infomercial companies offering to take care of your debt at penalising interest rates which can hurt a lot of people. This is not what Tuition.io does and we never will. We provide a service that keeps the borrowers needs in mind first and foremost. Our service is different because it custom tailors your optimization to what you want – whether that’s the lowest possible monthly payment or paying down the least amount of interest over the life of your loans.
What is your business model?
We started Tuition.io to help as many people as possible — people like us. In the near term, we’re focused less on revenue than on growing our user base as much as possible. We’re not looking to make a quick buck, but rather, we believe we’ll have plenty of opportunity to monetise in a major way once we achieve scale.
People can request an invite by visiting tuition.io and using promo code: BusinessInsider