Income sharing agreements are relatively new student loan alternatives that look to balance some of the benefits that were traditionally offered with Federal loans, in a new type of private loan.

The rising balances of student loans are a major problem. The problem tends to be especially pronounced among former students who fail to secure high-paying jobs after graduation.

One solution that has been gaining traction is income sharing agreements (ISAs). These are “loan-like” arrangements where students repay a set percentage of their income for a set period of time.

While they sound appealing - an alternative to student loans - they also come with their own set of risks you need to understand.

Are you considering a school with an income sharing agreement? Before you sign up for the program, here’s what you need to know about the agreements.